Business Monday – Cover Story Date Published: January 25, 1993 Author: Candance Siegle New Tigers of the business world Growing influence of Chinese offers spicy liveliness for Valley economy The elaborate stage is flanked by golden dragons trimmed with bright ribbons of lucky red. Overhead, Chinese writing on the streaming banners proclaims the New Year, and when the exotic cymbal and flute music of China ceases for a minute, it’s replaced by a recording of Kate Smith singing “God Bless America.” It’s the seventh annual Chinese American Expo, and despite torrential rain thousands are pouring into the Pomona Fairplex to browse at exhibitors’ booths, enjoy three stages of entertainment and sample the traditional sweet dumplings of the New Year. The expo is a sign of the growing Chinese influence in Southern California in general and the San Gabriel Valley in particular. While many businesses are pulling back – deciding to lay low in a recession – several Chinese firms are expanding, moving ahead and adding a spicy vitality to the Valley’s economy. At Panda, we focus on success, and that transcends culture. Joseph Olin Vice President of marketing Panda Inn Management, Title According to the 1990 census, 13.5 percent of the population of the San Gabriel Valley is Asian, with Chinese alone accounting for 37 percent of the population of Monterey Park and more than a quarter of the populations of San Marino and Alhambra. Between 200,000 to 250,000 ethnic Chinese live in the San Gabriel Valley. In 1987, Los Angeles – with a big hand from the Valley – overtook San Francisco as the U.S. city with the highest concentration of Chinese owned businesses. The retail and restaurant trades are the most visible examples of Chinese business activity, but Chinese entrepreneurs also have become the tigers of the import-export industry. Last year, imports from Taiwan, China and Singapore passing through the Ports of Long Beach and Los Angeles accounted to $18 billion, not counting the boost such activity gives to local real estate through the increased demand for warehouse and office space. Marco Brown of the San Gabriel Valley Commerce and Cities Consortium, a business and government partnership, says Chinese businesses add to the area’s economic vitality. “The introduction of Asian investment has been positive, not only because of the jobs it’s created but because of the added participation in the economic food chain,” Brown says. The influx of immigrants has brought scores of service industries to the San Gabriel Valley in the form of banks, residential real estate companies, supermarkets, customs services and lawyers and accountants. There are 30 major Chinese supermarkets in the San Gabriel Valley as well as 22 Chinese banks. Brown says most of those businesses are small operations which bring money into a community as well as add a spark of economic liveliness, always welcome in uncertain recessionary times. “Not only do Asians go into business, they stay in business,” says businesswoman and former Monterey Park Chamber of Commerce President Sophie Wong. “Immigrants come with money to invest and they pay premium for property in Chinese areas. They figure that they can’t go wrong to start their business in a Chinese neighborhood.” At the Seeley Co., a commercial real estate firm in Diamond Bar, Thomas Taylor calls Chinese investment a boom to the San Gabriel Valley real estate market. “They‘re still spending money,” he says. “Many Chinese people live in the San Gabriel Valley and they buy where they live. And they do buy – they mostly have family owned businesses and they prefer to buy real estate rather than lease it.” He calls the growth of the Chinese population in the Valley good for real estate. “Five years ago, there was hardly any Asian business. Today, they make up half the market for industrial real estate properties of 30,000 square feet or less.” _ _ _ Is the actively investing Chinese population helping the San Gabriel Valley to weather the recession? “We are in a better position to get through it, and Asians are part of that,” Taylor says. Brown agrees. “The Valley hasn’t been as hard hit as other areas, and the concentration of active Asian businesses here is part of the reason why. A diversified economy is one of our assets and because of that we’ve been able to ride the recession out better than other areas.” But Brown adds that the public private consortium she runs would like to encourage Chinese businesses to be more open by seeking goods and services from outside the Asian community and providing jobs for non-Asians. Vincent Wu, editor of the San Gabriel-based newspaper Asian Today says that the Chinese community is often seen as a closed group. “Many of us are immigrants and much of our capital comes from Asia. And we don’t know a lot about the U.S. business code,” he says. “We need to find a way into the American community.” As desirable as a move to a greater market might be, language and cultural differences often make that step a difficult one. The HZ Water System and Supply Co. in Industry concentrated on exporting its water purification systems to Asia until as sales manager Jesse Wu puts it, “the profits were just too small.” Just this year the company has begun to work the local market and to try to reach non-Chinese customers – through distributors. “For us to try to reach the American or Latino market would just be too difficult,” Wu says, citing problems with language and different sales techniques and customs. “Distributors can do it for us.” “Like all immigrant groups, the Chinese stick close to what they know,” says Wong, mentioning the growing number of shopping centers across the San Gabriel Valley which sells familiar Chinese foodstuffs, videos and consumer goods. “But banks, for example, are starting to go outside the Chinese community and are setting up branches in non-Chinese areas.” She says that branches of Chinese-owned banks are now to be found in West Los Angels, Pico Rivera, Montebello and Pasadena, adding that the baking industry was one of the first to be mainstreamed. The growth of the Chinese population and the broad employment base of Chinese cooks is one of the elements that have allowed the South Pasadena-based Panda Inn restaurant chain to be as successful as it is. “It takes Chinese chefs to know how to run a Chinese kitchen,” says Joseph Olin, vice-president of marketing for Panda Management, which runs 88 restaurants in 13 states under six different names. But in direct contract to the majority of Chinese-owned businesses, Panda Inn concentrates on cultivating non-Asian clientele. “In this economic environment, you have to very broad-minded,” says Olin. “The Chinese are accustomed to the Chinese way of doing business and sometimes find it hard to understand other cultures. They think, “Why change? I can do just fine within the Chinese community. At Panda, we focus on success, and that transcends culture.” Back at the Chinese American Expo, with the sounds of Chinese opera in the background, Bill Bauer of Monier Roof Tile is settling in for a busy day at the booth. The stall he shares with independent roofer John Cowan is conspicuously one of the very few without Chinese signs and peopled by non Chinese. This is Bauer’s second expo and he says he had been looking forward to coming back. Not only do Asians go into business, they stay in business. Sophie Wong Former president Monterey Park Chamber of Commerce “We had a good response last year.” he says. “They’re open to doing business with non-Chinese. It just takes a little extra effort.” Bauer and Cowan did have a small sign in Chinese made up for the booth and next year he may bring a Chinese speaker along. “The Chinese spend when others are holding back,” adds Cowan. “It takes time to prove yourself with them and this is a great place to start.” “Besides,” says Bauer, as a large dragon moves majestically down the center aisle, bobbing and waving its tail, “this is fun.” Chris Sun of the Chinese Overseas Marketing Service, which organized the expo, says more than 60,000 people attended the Jan. 16 and 17 event. “We had to move to Pomona this year because we’d grown out of the Pasadena Convention Center,” he says. “We got 300 booths this year, up from 230 last year. And the first year there were only 100. People like to come here before the New Year. It’s like a tradition.” The year of the Rooster began Jan. 23 and it’s supposed to be a good year for business. Asian Today Editor Vincent Wu says this should be a good year for cohesion between people and in business. “There is also an outgoing orientation in this Rooster year. This could make a difference in business, too.”