After a year of tedious work, Liao Jiaming managed to make his way home to Jiangxi Province in east China for a long-awaited Spring Festival holiday. However, on January 21, just three days before Lunar New Year’s Eve, traditionally a big family reunion day for Chinese people, the young man booked a ticket back to Chengdu of Sichuan Province in southeast China, to take up the production of facemasks. 

He made his decision after authorities confirmed the person-to-person transmission of the novel coronavirus on January 20. As it became a public health concern and more people were reported to have been infected with the virus, a shortage of facemasks became inevitable. 

As the General Manager of Sichuan Heng Ming Medical Equipment Co., Ltd., which runs several production lines including one for facemasks, Liao told the head of the factory to call back the workers. He promised to reimburse their fares and offered them triple their pay, striving to keep production going around the clock during the holiday.  

Liao donated the first batch of facemasks to Wuhan, the hardest-hit and frontline city. Along with offline sales as usual, the firm also turned to Tmall.com, an e-commerce platform, for the first time. A total of 100,000 masks immediately sold out after being offered online. Currently, the medical materials the factory produces are under the government’s coordinated allocation system. 

However, the company faces a string of difficulties and challenges. Overburdened machines have broken down, preventing Heng Ming’s output from remaining stable. In addition, the cost of procurement has risen. Liao told yicai.com, a financial media outlet, the machine for producing masks usually costs 180,000 yuan ($25,860), but the price went up by 60,000 yuan ($8,620) in two days. Moreover, raw materials are in short supply. While some suppliers were kind enough to provide materials at the same price, the overall price soared by 50 percent, he said. 

Due to multiple reasons such as unstable production and limited logistics, some of the company’s orders on Tmall.com cannot be delivered on time, which will lead to many complaints. Liao estimated that complaint payments would cost him a large sum of money. 

“To defeat the epidemic, we have to be fully prepared,” Liao said. “And we’ll persist even if we lose money.”  

In response to these types of issues, the government rolled out measures step by step. It has warned that arbitrary price hikes will be severely punished. Alibaba, the parent company of Tmall, told yicai.com that if sellers have given priority to frontline orders, making it harder to complete other orders, they will be exempt from liability after verification and the platform will take up the matter.  

Liao said there are 4-6 working groups from relevant departments stationed in his company now to help solve production problems, including supply shortages and communication with suppliers. 

Banks also sent staff members to learn firsthand about the company’s operational situation and its financing needs, making customized financial plans on site and offering discounted interest rates, Liao said.  

Meanwhile, the company’s application for a one-million-yuan ($143,660) loan was approved within 48 hours. 

Copyedited by Rebeca Toledo 

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