The Economics of Pepper and Wine

A French Bistro in Shanghai and Pepper that tastes like, well, poop.
Understanding the Chinese Economy

Saturday May 3

Yes, we found duck confit, pomme frits, and chocolate fondant in the French Concession, a place called Des Lis. While I can hardly imagine eating in a Chinese restaurant in Paris, I can think of nothing more exotic than a Parisian bistro in the Shanghai French Concession. (Francois, the owner, told us that his Chinese staff insist on calling it the former French Concession. It is Chinese.) We had a long chat with Francois; he told us he moved to Shanghai eight years ago to start a wine shop.

Here we are at Des Lis.
John will be passing up the pomme frits once he retires, or so Martha thinks.

One question about pepper turned into a lesson on marketing, history, and human nature. I asked our French friend why the pepper in China takes like poop – really. Manure. Shockingly horrible. (Learned that the day before when I told John that my omelet at the hotel breakfast was revolting. “Did you put pepper on it?”

Well, Francois says that pepper used on the table – even in nice places like our hotel, is the cheap kind. “Not this kind,” says Francois, as he whips out a large fresh black pepper grinder – different from the pepper at our table even there. Francois goes on to tell us that the Chinese people buy the cheap pepper instead of better pepper – it is a habit. They go for the cheap stuff. The same thing caused the failure of his wine store, says Francois.

As hard as he tried, he could not educate the Chinese on the subtleties of choosing and drinking good wine. They don’t know how to taste it. They don’t sip it – they drink it like Russians, he says. They don’t even serve it with food – they drink if after dinner if at all. If they have money, they buy the most expensive wine, even if it is inferior to the cheaper wine, as a mark of their status. If they don’t have money, they buy the cheap wine or no wine. Either way, they don’t buy the good wine. This problem of taste is complicated by the system in China whereby prices are never fixed – everything is up for bargaining.

The same people who refuse to sniff, sip, slosh and romance about wine will spend hours in a tea shop doing all of the above before purchasing.

Poor Francois could not impose hundreds of years of French wine culture on his Chinese customers. “Look out there,” he says, pointing to the plane-tree lined streets of the elegant neighborhood. You see Maseratis, Ferraris, and BMW’s out there. But do they know good wine?”

So John and I talked about this spot where the Chinese find themselves – wedged in their tiny (but not mortgaged) apartments and pulled toward both cheap pepper and French bordeaux.

What factors influence their willingness to spend or save? Household savings in China are between 25 and 50 percent, extremely high by world standards, and personal debt is very low compared to the US. Maybe past suffering plays a role. Even the young generation must have hints of decades of devastation, despite the fact that open discussion on this topic in Communist China is taboo. Other reasons for frugality, for saving family income rather than spending, are the country’s lack of social security and medical coverage, the ratio of males/females, and “A culturally bound ethic (Confucianism) in improving the futures for their family.” (Forbes).

The Chinese save much more than Americans for the education of their kids. Hmmm – not such a bad idea.

But will things change? Will the Chinese open their pocketbooks to better pepper? The Chinese government is encouraging more consumer spending.

And then, there’s the matter of taste. Be patient, Francois.

Dinner with our Shanghai Friends. We had dinner with our good friend Alice and her husband Rongpin, and son Roger at a tapenyaki restaurant called Kakapei on Nanging Road. Alice is a big part of why I love Shanghai. Hers was the apartment we stayed at during our week-long vacation in Shanghai on Christmas, and she was the planner for many of our activities over the years. What a lovely dinner – with a special bottle of wine brought in by Alice. Alice said, “I hope the wine is good. I know you wouldn’t like the wine they serve at this restaurant, so I brought this. But I don’t know how to tell if it’s good wine or not.”

It was good.

Roger is a big fan of sashimi.

Martha – Madly Traveling Asia with Faucet Marketing Husband

Location:Shanghai, China


Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )


Connecting to %s