Many Chinese are nostalgic for old brands, but there's no point mourning these outmoded products. Their rebirth can come only through adaption to a changing market, a lesson that Chinese State-owned enterprises have to learn, according to Zhou Junsheng, a finance commentator, in an article in the
Guangming Daily, on August 8.
A few days earlier, a social media post started circulating that mourned the plight of the Hero Pen, a Shanghai-made brand that the author claimed used to compete with Parker on global markets. Today the total value of the firm is less than the cost of an apartment in Shanghai, according to the post, but Zhou said this was an old story and does not reflect the truth today.
Many other made-in-Shanghai brands produced by old State-owned enterprises, including sewing machines, watches and bikes, lost their market due to technological progress and the country’s shift to a market economy. Pens are hardly a vital part of life today, and Hero’s diversification into other industries, like pianos and kitchenware, failed in the 1990s. Zhou said the figures for the company given in the post were part of a deal in 2012 that was cancelled. In the last few years, Hero has already rebuilt itself into a conglomerate that includes pens, other stationary, and real estate.
Zhou noted that it is “not realistic or necessary” for firms to resort to a single product for a niche market. Following new trends is the only way for any enterprise to survive. SOEs should learn from Hero's experience that innovation, not nostalgia, is the way forward.
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