The Nokia plant in Beijing is a unique example of the booming Chinese industrial sector. It has state-of-the-art automation and relatively few workers. Furthermore, the Chinese government helped the company establish a large, new industrial park known as the Xingwang (International) industrial park that now houses most of Nokia's major suppliers too. The close proximity and increased face-to-face communication with suppliers helps Nokia speed up development of new products and simplify production logistics.

This world class mobile telecommunications manufacturing base is one of the largest foreign investment project in Beijing that attracted more than 20 leading suppliers of Nokia.

Nokia also sponsors a joint cafeteria and health club for all managers in the industrial park to help build relationships between Nokia managers and their suppliers. Nokia and their suppliers have even consolidated their commuter bus system so that inter-company networking can continue on the ride to and from work.

In a presentation at the factory premises, Hera Siu, vice-president, Nokia (China) Investment Co Ltd mentioned that China is the world's largest mobile phone market, which is almost 20 per cent of world's total mobile phone subscribers. She also mentioned that the resources China offer to build Nokia's global competitiveness includes -- large supply of skilled labour, good infrastructure for research and development (R&D) with 500,000 annual graduates in IT and government incentives and policies for business. The plant manufactures handsets for the China and Asia Pacific countries.

Gerry Wong, senior manager, Quality APAC Operations & Logistics, Customer and Market Operations, Nokia (China) Investment Co elaborated the factory operations and how the plant maintains the international standard and test every single handset that comes out of the plant.

There is a perception in our market that products made in China are not of good quality. But visiting the Nokia plant in Beijing one thing was quite clear that when Nokia produces its products in China, it is not a Chinese company that manufactures the products. Nokia itself, maintaining its global standards and quality, manufactures the handsets that meet the international standard.

We have two types of Nokia handsets in the Bangladeshi market. One, that comes through proper channel and are distributed through authorised distributors, and the other known as the 'Grey' or unauthorised handsets.

"In Bangladesh, if we look back 12 months, the market was 6070 per cent grey. We have started campaign and also the reductions in duty have reduced the grey market to 50 per cent," Prem Chand, general manager, Emerging Asia Customer and Market Operations, Nokia, said while describing the present market situation.

"The Sri Lankan market is about 80 per cent grey. It's a significant issue in Sri Lanka which comes down to two issues. First of all the duty in Sri Lanka is not in the same level as Bangladesh or India, that leads to the illegal trading of the handsets.

And the other is about consumer education campaigns. We have already launched a campaign in Bangladesh about 2 months ago and we are starting to see the results of that and we will be launching a similar campaign in Sri Lanka by the end of August," Prem added.

"The important part of buying an authorised Nokia handset is that the consumers get value out of their handset. They might save a dollar or two, through purchasing a grey handset but the battery and the charger are made by third party, so the performance is poor."

"They maybe paying a little less but the value that they are getting are significantly lower. And the other thing is that the authorised handsets have localised operator settings, which the illegal handsets do not have," Prem stated.

"In terms of localising the product, for Sri Lanka we shall launch a new device with Sinhalese and Tamil language options. Which means when someone switches on the device has the option of choosing from English or Tamil and the whole experience in terms of menus, text and everything will be in local language. For Bangladesh, we have done a similar thing from the beginning of this year, all the entry-level handset devices such as Nokia 1110, 1600, 2310, 2610, 6030, are coming into the market with the local Bangla language. We are setting up our local office in Dhaka and in the next four weeks we shall have at least 10 devices that will have local language options."

In addition to localising the product and developing local campaign Nokia are focusing mainly on customer care. "After sales service is very important for us and we are looking at developing our 'care' network to ensure that all consumers get the same experience," said Prem.

Globally Nokia provides 12 months warranty for authorised handsets, therefore anything that goes wrong within that period, free of charge service to the consumers will be provided. When it comes to unauthorised handsets, the care centres will still be providing support, however the consumer will have to pay for that.

At present there are 27 service points in Bangladesh and within the next three months Nokia will setup their branded care centres, which will have the look, feel and the Nokia experience.

Prem also mentioned Nokia phones with the label ‘Made by Nokia' has been out in all markets for the last 3-4 years. When asked about the Indian factory, Prem said the factory started production from February this year, and they predominantly manufactures product for their local market.

"In Bangladesh, we estimated about half a million handsets are sold every month and in Sri Lanka around 70,000-100,000 handsets are sold monthly. Nokia has a major share in these two markets," Prem said when asked about the volume of the market. Nokia handsets are in great demand globally.