Alexandra Harney has written an excellent article posted at Slate.com on the cost issues in China. The article titled "The Last Days of Cheap Chinese - Why American consumers are about to start paying more for clothes, electronics, toys, and just about everything else".
http://www.slate.com/id/2188409/
In the article Ms. Harney describes the "perfect storm" of cost issues for Chinese manufacturers. These are the same issues I've mentioned in previous posts - appreciation of the RMB, labor law changes, labor supply shortages, raw material costs, and oil prices. Actually she leaves out the actions the Chinese government has taken (like eliminating some VAT rebates) to slow economic growth and avoid further domestic inflation.
Ms. Harney ends the article by describing prospects in other low-cost countries like Mexico and Vietnam. She concludes that China is still the best option for most sourcing efforts.
I agree completely with the observations in the article and the conclusions - China is still the best option, but the era of very low prices is over for now.
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