Table of Contents S.no Topics Pg.

no

Introduction

Literature review

Research methodology

Findings and Suggestions

Data analysis

10

Pareto analysis

13

Diagrammatic representation

14

conclusion

15

Questionnaire

16

ABSTRACT
China, which is a growing economic power, exports its manufactured goods to the entire global markets. In India imports were increasing day by day around 200 million crores of imports were from china only due to its competitive advantage than other countries. Chinese goods have been successful to capture market because of its competitive price strategy as compared to the products of other countries. The major problem with the Chinese products is that these are perceived as of relatively inferior quality in comparison to the products of other countries. This study is an attempt to assess the perceptions of customers regarding price and quality aspects of Chinese and non Chinese products. To compare the relative effectiveness of price and quality, the concepts of perceived life and perceived value are used. It is found that the Chinese products are perceived as price effective but the area of product quality requires.

1. INTRODUCTION:
It is being observed that the sale of Chinese manufactured goods is very common in the markets around the globe and Chinese products such as home appliances, generators, stationary items, clothes and fabric and hardware are dominating specially in the Indian markets. Figure 1 shows the import of manufactured goods from China following a consistently rising pattern while Figure 2 shows the growth rate of Indian imports (Billion US $) from China.

60 50 40 30 20 10 0

Chinas Exports to India in us$

Chinas Exports to India in us$

2011

2012

2013

Source :(http://www.indianembassy.org.cn/DynamicContent.aspx?MenuId=3&SubMenuId=0)

250 200 150 100 50 0

growth rate

growth rate

Source: (http://www.indianembassy.org.cn/DynamicContent.aspx?MenuId=3&SubMenuId=0)

Source: (http://www.foreign-trade.in/node/98) By observing the above graph imports of India were majorly from china than other countries like Germany, Belgium, Indonesia, Japan, and Saudi Arabia etc,,. After china, India majorly imports from Switzerland. The Value of imports from China is around 200 million crores in 2011-12. Due to its competitive advantage in human resource its playing a major role in the exports of all over the world. China, which is a growing economic power, exports its manufactured goods to the entire global markets Consumers are usually attracted by low price of Chinese goods as compared to goods imported from other countries but on the other hand they are skeptical about the durability of Chinese manufactured goods. The quality of manufactured goods is an important factor for consumers and is considered as an important factor for the exports too. This study focuses on comparing the quality, durability and value of goods manufactured by China and other countries available in the markets of India as perceived by consumers. Perceived quality can be defined as the customer's perception of the overall quality or superiority of a product or service with respect to its intended purpose, relative to alternatives. Perceived quality is, first, a perception by customers. It thus differs from several related concepts, such as: a) Actual or objective quality: the extent to which the product or service delivers superior service b) Product-based quality: the nature and quantity of ingredients, features, or services included c) Manufacturing quality: conformance to specification, the "zero defects" goal
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2. LITERATURE REVIEW: Perceived product quality is perhaps one of the most important constructs in marketing .In recent years perceived quality has been the subject of considerable interest to both practitioners and researchers, mainly in services marketing. Indeed, the belief that perceived quality leads to repeated purchases is the bedrock of any business. Thus a better understanding of the relationship between perceived product quality and product involvement, consumer satisfaction, and purchase intentions may help academics to develop a model of consumer decision making for goods. Products life or durability is equally important as price criteria to the consumer in a purchasing decision. For last several decades market research studies have consistently confirmed that product durability is a primary factor that influences repeat purchases. Consumer perceptions of price, quality and value are considered pivotal determinants of shopping behavior and product choice.

Intrinsic cues Intrinsic/extrinsic Perceived quality

Extrinsic cues Perceived value

Monetary cost

Purchase

Market price

Perceived price

Forgone cost

On the basis of the above mentioned references it can be concluded that Price and durability of a product make a customer satisfied about the product. Hence satisfaction of a customer about a product is related with the constructs perceived price and perceived durability, and it influences the purchase decision in future. As the consumer product price and durability are the primary factors for making decisions about future purchase, therefore the metrics based on customer knowledge about pricing and their perceptions about the durability of a product are suitable measures that can be used to reflect conditions of product quality and product value. Survey questionnaires are a primary means for collecting data of consumer perception of price, quality and value Of particular importance is the fact that many research studies have shown that metrics based on customer knowledge about pricing and their perceptions of product durability are appropriate measures that can be used to reflect conditions of product quality or product value by the customers to determine consumer product purchase behavior. Schniederjan, Cao and Olson have concluded that perceptions of consumer purchasing behavior can be accurately measured. Consumer product price and durability are primary factors in future consumer purchasing decisions. Also price and durability can be linked together to compute a consumer metric called product value. A model relating Perceived Quality, Perceived value, and Perceived Price as the purchase decision 3. RESEARCH METHODOLOGY: 3.1 Data Collection: To conduct this study, an online survey questionnaire is designed that targets the consumers belonging to different age group in different locations through social networking sites. The items manufactured by China and other countries are available in the markets of Andhra Pradesh and the items included in this study have been considered on the basis of a survey of different markets in Andhra Pradesh through e-search. The list of items included in this study comprises of 77items. The items being included are placed in different categories named as Lawn Furniture, small appliances, electronic items, clothes and fabric products, Hardware items and General Miscellaneous as given in Appendix 2. The questionnaire was forwarded to the consumers who

were there in my friends list in social networking sites and I received 300 responses out of which 270 response were found complete in all respect and have been included in this study.

age Frequency Valid under 20 20-29 30-39 above 40 Total Missing Total System 50 217 22 10 299 1 300 Percent 16.7 72.3 7.3 3.3 99.7 .3 100.0 Valid Percent 16.7 72.6 7.4 3.3 100.0 Cumulative Percent 16.7 89.3 96.7 100.0

After observing the frequency table, age between 20 to 29 were 89% more in number than other ages.

Gender Cumulative Frequency Valid male female Total Missing Total System 194 105 299 1 300 Percent 64.7 35.0 99.7 .3 100.0 Valid Percent 64.9 35.1 100.0 Percent 64.9 100.0

Above frequency table shows that males are more in number while comparing to the females from the collected responses.

3.1 Research Instrument The research instrument for this research comprises of 18 questions. The questions are about age, gender, marital status, education, origin of the item in use, price of the item, expected age of the item in use, satisfaction level etc. The constructs of our research instrument was pretested with a focus group to determine, whether the questions are correctly understandable for extracting the required information and to determine whether the questions are valid or not. The results of this pretest revealed no misinterpretation of the questions. The questions used in this study are presented in Appendix 1. 3.2 Purpose and hypothesis: The purpose of this research paper is to study consumer perception on the quality of products made in China. In this research we will concentrate about following two objectives: 1. To compare Business institutes consumers-based perceptions on the quality of Chinese made goods with the perceptions of non-Chinese goods. 2. To compare Business institutes consumer-based perceptions on the value of Chinese made goods with the perceptions of non-Chinese goods. In the light of objectives of this research following alternatives have been stated to test their truthfulness. H1: Chinese manufactured products are perceived significantly low in price as compare to products produced in other countries. H2: There is significant difference between the mean perceived life of the products manufactured by China and by other countries H3: There is significant difference between the mean perceived values of the products manufactured by China and by other countries. H4: Chinese manufactured products are perceived as significantly low in quality as compared to the products produced in other countries. .
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3.3 Variable measurement metrics In this research Simple Economic Indexation procedure has been used for comparing the perceived quality and value of Chinese manufactured goods and non-Chinese manufactured goods. The quality characteristics of the products used in this research are product price and product durability. The ratios for both the Chinese and non-Chinese products are: Product Value (Chinese product) = Mean price paid for Chinese products .(1) Mean number of months product actually lasted Product Value (Non-Chinese product) = Mean price offered for non-Chinese products..... (2) Mean number of months product was expected to last The lower the value of the index, the better the overall perceived quality of the product. Quality is defined as the duration of useful life relative to the price paid for the product. The computation of net product value is based on the ratios in equations 1 and 2 given as under: Net product value = Product value (non-Chinese) Product value (Chinese)..(3) The larger the product value, the greater is the price /cost of their use. As long as net product value is positive, the value of the non-Chinese products is better than the Chinese products, if net product value is negative, the Chinese products sampled in this survey are rated as more price /cost-valued than the non-Chinese products. In order to compare the relationship of non-Chinese product value with that of Chinese product value is a simple price ratio index of the product values.

A product value index less than 100 favors Chinese goods, while an index greater than 100 favors non-Chinese made goods. Computation of Equation 1 is based on the responses to question 8 and 9 while computation of equation 2 is based on responses to questions 10 and 12. The responses are however based on the assumption that the respondent: 1) Remember the price and 2) Remember that it was a Chinese or non Chinese product

4. FINDINGS AND DISCUSSIONS: The number of responses to each survey question from the total of 300.Based on the sample of 300 responses the mean price, mean durability, product value, net product value and product value index measures were computed . It gives comparative analysis of Product value and net product value for the Chinese and Non-Chinese product. It also gives the Product Value Index, the value of which can be interpreted with respect to the standard value of 100. If for any product, we get 100 as the Product value index, it indicates that the Product Value for both Chinese and Non-Chinese for that product is same. Any value less than 100 indicates that the product value of Chinese Product is greater as compared to the Non-Chinese Product. Similarly, if it has a value greater than 100, it favors the Non-Chinese Product in terms of Product Value Index. We can identify that travelling bags is the product having Product Value Index of 101.67 which is closer to 100, and it implies that for this product the respondents are indifferent regarding the product value of Chinese and Non-Chinese product. The items mobiles (67.40) and electronic equipments (172.99) have the lowest and highest Net Product Value Indices respectively. ITEMS MPNC usefu l life 14 20 32.5 24 24 17.8 21 26 18 16.45 18 17.6 35.5 product value 187.989 16.65 1228.1 82.302 559.666 7 174.157 696.498 365.384 74.13 162.855 155.555 2007.55 422.535 MPC usefu l life 12 24 30 20 12.5 12.2 18 9 14.73 15.4 16.8 12.35 11 product value 144.28 12.25 1000.8 58.912 600 177.049 473.402 629.555 88.564 129.139 128.222 1764.29 727.272 net product value 43.704 4.4 227.32 23.389 40.333 2.8918 223.09 264.17 1 14.432 33.716 27.332 243.26 304.73 product value index 76.7518621 73.5735735 81.4908764 71.5806676 107.206670 101.660497 67.9689517 172.299415 119.468484 79.2964452 82.4288265 87.8825187 172.121212

Ele. shavers calculator laptops watches digital cameras travelling bags mobiles electronic equipments shoes male head phones dvd players kitchen accessories table tennis

2631.85 333 39915 1975.2 13432 3100 14626. 9500 1334.8 2678.98 2800 35333 15000

1731.4 294 30025 1178.2 7500 2160 8521.2 5666 1305 1988.7 2154.1 21789 8000

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MPNC: mean price non Chinese products; MPC: mean price for Chinese products. Net Product value computed for 300 subjects on the basis of questions 4 8 from the questionnaire which indicates that 8 out of 13 are the non Chinese products have greater product value than Chinese products. Negative sign is appearing with the measures of 5 products favoring these 5 Chinese products like table tennis, electronic equipments, shoes male, travelling bags, digital cameras. Therefore, it can be concluded that consumers perceive 5 of these Chinese products better than competing non-Chinese products. 5. DATA ANALYSIS: In this research data analysis has been performed with the help of SPSS 17 in two stages. At the first stage, in order to test the hypothesis H1, H2, H3 and H4, independent samples testing has been performed. H1: Chinese manufactured products are perceived significantly low in price as compare to products produced in other countries
t-Test: Paired Two Sample for Means Variable 1 Mean Variance Observations Pearson Correlation Hypothesized Mean Difference Df t Stat P(T<=t) one-tail t Critical one-tail P(T<=t) two-tail t Critical two-tail 10973.84 1.69E+08 13 0.988505 0 12 3.220133 0.003676 1.782288 0.007353 2.178813 Variable 2 7100.985231 80429258.35 13

By observing the above analysis: The mean perceived price of Chinese products is significantly less than the average price of NonChinese products, which supports our H1. P- value less than the 0.05 which accepts H1

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H2: There is significant difference between the mean perceived life of the products manufactured by China and by other countries
t-Test: Paired Two Sample for Means Variable 1 21.91153846 40.43339744 13 0.231783778 0 12 2.810595872 0.007866007 1.782287548 0.015732014 2.178812827 Variable 2 15.99885 34.38439 13

Mean Variance Observations Pearson Correlation Hypothesized Mean Difference Df t Stat P(T<=t) one-tail t Critical one-tail P(T<=t) two-tail t Critical two-tail

H2 accepted. There is a significant difference between the perceived life of the products manufactured from china and non Chinese products. H3: There is significant difference between the mean perceived values of the products manufactured by China and by other countries.
t-Test: Paired Two Sample for Means Variable 1 Mean Variance Observations Pearson Correlation Hypothesized Mean Difference Df t Stat P(T<=t) one-tail t Critical one-tail P(T<=t) two-tail t Critical two-tail 471.803 323682.3 13 0.960379 0 12 0.335757 0.371426 1.782288 0.742852 2.178813 Variable 2 456.4445739 251006.1282 13

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Reject H3 There is no significant difference between the perceived value of the product of Chinese and non Chinese products. H4: The difference between the mean perceived quality for Chinese and Non-Chinese products are significant which supports our H4
t-Test: Paired Two Sample for Means Variable 1 10973.84 1.69E+08 13 0.988505 0 12 3.220133 0.003676 1.782288 0.007353 2.178813 Variable 2 7100.985231 80429258.35 13

Mean Variance Observations Pearson Correlation Hypothesized Mean Difference Df t Stat P(T<=t) one-tail t Critical one-tail P(T<=t) two-tail t Critical two-tail

H4 accepted

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6. PARETO ANALYSIS: Pareto analysis is used to assess question 16, that focuses on the reasons for perceiving the Chinese and non-Chinese products differently. In this research the Pareto analysis is based on the information from question 16. It identified the three main reasons for which Chinese products are perceived as low graded.

180 160 140 120 100 80 60 40 20 0

120 100 80 60 40 20 0 Frequency cumulative percentage

DURABILITY- 168,

MATERIAL -53, OTHERS 57, DESIGN- 10, WORKMAN SHIP-12.

By observing the pareto analysis that there is 57% of these five reasons for perception of the failure of the product. It is suggested that the Chinese manufacturers should consider these reasoning in their quality improvement program in order to improve the perception among the consumers about the quality of their products.

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7. Diagrammatic representation:
How do you feel about the quality of any similar non-Chinese product you used earlier? How do you feel about the quality of any similar non-Chinese product you used earlier?

Frequency Valid bad poor average good excellence 53 Total 1 16 122 144 16 1 300

Percent .3 5.3 40.7 48.0 5.3 .3 100.0

Valid Percent .3 5.3 40.7 48.0 5.3 .3 100.0

Cumulative Percent .3 5.7 46.3 94.3 99.7 100.0

How do you feel about the quality of Chinese product you experienced earlier

How do you feel about the quality of Chinese product you experienced earlier?

Frequency Valid bad AVERAGE FAIR GOOD EXCELLENT Total 34 101 121 36 8 300

Percent 11.3 33.7 40.3 12.0 2.7 100.0

Valid Percent 11.3 33.7 40.3 12.0 2.7 100.0

Cumulative Percent 11.3 45.0 85.3 97.3 100.0

By comparing the percentages of perceptions about the quality of Chinese and non Chinese products in the above tables 48% consumers rated non Chinese products were good and 40% of consumers rated non Chinese products were fair.

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8. CONCLUSION: This research is based on consumer survey where price and product durability has been used as measures to assess the perceived quality of Chinese and non-Chinese products. This research supports H1,H2 and H4 therefore it may be concluded that the average price of Chinese products is significantly less than the average price of non- Chinese products while same is true for perception regarding quality of Chinese and non-Chinese products and there is a significant difference between perceived life of product of Chinese and non Chinese products. However, I did not found any difference between perceived qualities of Chinese and non Chinese products. Although Chinese products are dominating in the markets all over the world but Chinese manufacturer have to pay attention to improve the quality of their products in order to maintain this domination. Product quality is an aspect in which Chinese Products are lacking as consumers perceived the non-Chinese products as of better quality as compared to the Chinese products. And Chinese products have to develop their durability than non Chinese products most of the customers were not satisfied with the durability of the Chinese products.

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Age: 1. Gender: (300) 2. Marital Status: (300) 3. Have you purchased recently and used an item made in China in the last four years? (If you answered yes proceed to the next question) Which Chinese products you purchase during last four years?( Check all that apply) (300) Which Chinese product did you purchase and used (write the item from the list attached, also circle it in the list) (300) Considering the price and the length of useful life of the Chinese made product, how would you rate the value of this product from what you might have expected from using the similar product in the past? (300)

_______Years

Male / Female

Single / Married

Yes/No

4.

5.

________________

6.

7.

1 I feel cheated 2 Poor value 3 Fine value 4 Good value 5 Great value Rs._______________

Roughly, how much did you spend on this Chinese product? (300) 8. Roughly what was its useful life? (Specify in nearest months) (300) 9. How many months of useful life did you expect from this product? (Specify in nearest months) (300) Did you compare prices with other similar items at the time of your purchase of the Chinese product? (300) Roughly what was the price of a similar item that you did not purchase? (300) 12. What was the country of origin for the similar item which you did not purchase? (300) How do you feel about the quality of any similar non-Chinese product you used earlier? (300)

_____________months

______________months

10.

Yes/No

11.

Rs.____________

_________________

13.

14.

1 Bad 2 Poor 3 Average 4 Good 5 Excellent

How do you feel about the quality of Chinese product you used earlier? (300) 15. 1 Bad 2 Poor 3 Average 4 Good 5 Excellent

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16.

How much did you spend on this Chinese product you identified in question no. 11? (300) If you have to guess why your Chinese product failed which one of the following is your guess?( Mark all that applies) (300) Is there anything you would like to comment concerning products made in China? (300)

Rs.___________

17.

Workmanship Material Design of a product Durability Other __________________

18.

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