Zheng Yonggang is an unusual entrepreneur, for many years he has insisted on only working eight hours a day
Zheng Yonggang is unusual amongst China’s top entrepreneurs.
Firstly, his $600m (£377m) fortune was built by taking a state-owned firm into the private sector, whereas most wealth is made from companies started from scratch.
Secondly, Zheng does not owe his success to sheer hard work. For many years he has insisted on working no more than eight hours a day and he even has a 20-minute nap on weekdays.
He enjoys having his meals at home and accompanying his wife for a walk each day when most of his fellow-entrepreneurs are still at their desks.
Zheng has developed his own management strategy which he calls “pagoda structure management”. Instead of micro-managing, he adopts a more Western style, with a team of senior staff responsible for their own departments.
Zheng was born in 1958 in Ningbo, Zhejiang province. He joined the army when he was 18 and dreamed of being a general. After he retired from the army he was assigned to an international trade company but quit two years later, because he found it “too limiting”. He moved to Ningbo glove factory, a loss-making enterprise, and turned it around in two years. Age 30, he was then asked to repeat his success at a larger, clothing manufacturer, which he promptly named the Yonggang costume factory. It later changed its name to Shanshan.
This was at the dawn of China’s move to a market economy and Yonggang was one of the first companies to issue shares. Its other major innovation was to create a network of franchises, unheard of in China at that time.
For the next two decades Zhen continued to build Shanshan, using the cash flow to diversify from clothing into rare earth minerals and real estate, buying stakes in mines from Australia and Argentina to secure supply for lithium battery operations. In February 2010 Japanese conglomerate Itochu Corporation acquired 28% of the Shanshan Group – investing 10bn yen (£79m). The relationship started in 1993, when Itochu consigned production of export-quality shirts to Shanshan. Their three priority investment targets are apparel, cutting-edge technology – notably lithium-ion batteries – and real-estate development. In apparel Shanshan has started production for Itochu’s joint-venture operations, with designer brands like Renoma Paris and Le Coq Sportif. In the aftermath of the earthquake Itochu is in a position other Japanese companies might envy, with access to production across China.
This might be Zheng’s greatest opportunity yet.