Virginia Moore manages a project logistics company, YN Logistics. Originally focused on imports for international engineering, procurement and construction companies, the company also transports equipment for projects worldwide.
When and why did you first come to China?
I came to China as a carefree youth in 1990. It seemed like there would be a lot to understand here. And having heard Ronald Reagan’s Evil Empire speech about communism, it seemed like something one ought to experience. I went back to America for one year in 1992, but I have been here since.
How did you get into the shipping industry?
China’s shipping industry was opening up in the early 90s – or at least the solid wall of domestic monopolies had a chink. Also, my partner was a graduate of Shanghai’s Maritime University. I had to learn contract terms for shipping in Chinese and English simultaneously. Shipping has its own language. There are lists. The thing about shipping is that there are many moves to each step. But people think it’s just a ship.
YN is a highly specialized logistics and shipping company. Can you describe some of your more difficult past projects?
My favorite project was for a woodchip plant up the Yangtze River in Hubei, in an area where the path of the river was too unsteady to have permanent terminals for berthing of vessels. We had to build a temporary terminal to discharge the cargo that was brought in from Singapore. But the real challenge was that we were competing with the Three Gorges project for the equipment. It took a while to realize what the problem was because no one really wanted to say.
The most fun operation we had was bringing a Chinese barge owned by a division of the Shanghai port to Masan, Korea to pick up an 800-ton piece for a job in Caojing Development Zone in the outskirts of Shanghai. The Chinese barge had not been in international waters before and it did not have computerized automatic ballasting. It had already taken six months to negotiate the project but now the insurance company didn’t think the barge had enough pumps aboard. The Chinese thought they did. It took another three months to resolve. The two pumps only cost US$100 each.
In the meantime I was getting more and more pregnant, and it frightened all the barge people that someone so pregnant was running the operation. But I now have a lot of credibility with the Shanghai port authorities.
You ship very large industrial products. Does that create special customs clearance needs?
Many of the projects are duty exempt because they are capital equipment. Customs regulations regarding duty exemptions have been tightening incrementally for the past ten years. Whether the cargo can be exempted depends on the description of the cargo in the shipping documents. This can be difficult to explain to an overseas supplier who is used to describing their product on their own terms.
We once shipped an entire ThyssenKrupp steel plant from Germany. The mill was from the 1930s or around then and a private Chinese steel mill purchased the entire thing in 1998. Then the government took a harder look at such old plants and such projects stopped.
Recently, as the regulations for second－－-hand equipment have loosened, we have found that most of the cargo is being imported into inland destinations. And those inland factories are terrified of clearing customs in Shanghai. Again, we need to get them in the habit of creating immaculate documentation to present to Shanghai Customs.
Given that you have to negotiate with local authorities to move traffic lights, electric cables, etc., how many months in advance do you begin the planning to move a large piece of machinery?
For cargo that is over six meters in height there are often a lot of serious obstacles. Those jobs usually require six to eight weeks planning with the local authorities to set up a date. But usually we need to start planning once the equipment specifications are proposed — because some cargo cannot be moved on the road at all and we need to survey the obstacles to let the engineers know. However, as everyone’s eyes are on these big pieces, they usually give time for planning. Our biggest problems arise when there is some small part missing on a site and someone makes an order for overnight delivery.
What else do you ship besides large industrial machinery?
We have invested in a shipping company that ships cement and steel products. Most of our logistics customers are in engineering, procurement and construction. One of our big customers manufactures port equipment and that equipment often needs parts so we also ship parts.
You are a Western female entrepreneur in China working in an industry traditionally dominated by males. How have you succeeded?
I was in charge of sales for many years. I think I relied on inspiring fear of Chinese regulations, which are based on the Soviet model and therefore onerous and tedious. If you want to import things into China you have to do a lot of planning. So I was frequently trying to explain to people that if you don’t understand those regulations, you’re not going to get your cargo in. Regulations trump womanhood. I would suggest that more women in general should spend more time at the Chinese ports. Wide open spaces. Usually with views. And stevedores are generally willing to comply with shrill voices nagging about lashing [lashing down cargo properly to a vessel]. That has always been my experience.
Has the shift away from heavy industry to services impacted your business?
China has become an exporter of equipment. Our business has moved from imports to exports around the world. I think the bigger impact is about global projects in mining, power and oil and gas which have been halted.
Many of your clients are foreign multinationals. Do you also do projects for Chinese companies?
We do face some difficulties competing with the state forwarders. And yet, we are also able to get business assisting those same forwarders in their overseas business, again by providing detailed technical plans.
What is your company’s competitive advantage?
We follow international best practice for movements of oversize cargo. We have people monitoring each stage of a movement. And for customs regulations, we ask overseas suppliers nicely if they can describe their cargo in more detail. People value our persistency. And belief that customs issues can be settled before the cargo arrives.
You have been managing a team of local Shanghainese for some years. What advice would you give to an expatriate who has been freshly posted here?
I had a discussion with a women’s group about this issue some weeks ago. One woman had been sent here with a clear mission from headquarters: to make the organization think more strategically, to look more to the future. That was her role, and to her it all made sense. In order to grow you have to do things like change a product.
However, each of those things was actually challenging to people here in the organization, but she was puzzled by why the organization wasn’t accepting these ideas. The real issue was that you have to know where people’s interests lie — that whole Chinese thing of “you are where you sit.” You need to really appreciate that systems that exist here have a lot of traction. You also have to know how deeply people may feel, how cautious they may be. If I am back in St. Louis, in my own culture, we do this automatically without thinking. We know all of these issues, and we know them deeply, and our minds are already thinking about how to get around them, how to corral people.
Also, there’s the issue of you coming in from the United States. This is not someone coming in who is going to work up from the bottom. You are coming in from on top or from the side. I came here when I was young so I have been part of the processes that now need re-examining. Changing things requires understanding why a process was previously done differently. Being here has taught me to ask those questions of myself and to accommodate other ideas, because they can actually contribute to the process.
You first joined AmCham in the early 1990s. What would you like us to do more of?
I am impressed by all the recent initiatives. I guess I would recommend anything that expanded the reputation of what American business stands for.