Why do electronics business in Shenzhen?

In Shenzhen, China lies the largest electronics market on earth, called Huaqiangbei, pronounced Hua Qiang Bei (soundbyte pronunciation). Inside Huaqiangbei electronics market Shenzhen, each stall on all 10 floors represents a factory located somewhere within Chinas Pearl River Delta megalopolis. Most factories are located one hour north of Shenzhen, but Foxconn retains a presence as a booth of sales representatives inside the Huaqiangbei markets in Shenzhen. It is at these markets where many Shenzhen electronics manufacturers sell their products, source materials, and brainstorm ideas.

Since Shenzhen produces 90% of the world's electronics, skilled packaging and shipping specialists are close at hand. Shenzhen is also home to China's most successful high-tech companies, including Tencent, TP-LINK, ZTE, and Huawei. Shenzhen is home to some of the biggest, most exciting companies in China. Formerly a cluster of fishing enclaves near Hong Kong, which became a hub for China's manufacturing-led wonders, Shenzhen is re-inventing itself, betting its future growth on finance, tech, and culture.

Not content with being a global manufacturing hub, the Chinese megacity has its sights set on becoming the global leader in high-tech innovation, the rising star in a shift from "made in China" to "designed in China". Thanks to the boom of electronic commerce, Shenzhen is China's richest city, boasting China's highest GDP per capita. China's metropolis has grown and developed to meet the insatiable world demand for electronics products, and is now one of the largest cities and also its richest. The magic that has transformed Shenzhen from a fishing center into an electronics production realm is not lost on Chinese residents.

Today, Shenzhen is one of the world's fastest-growing cities, home to some 12 million residents. In 1979, Deng Xiaoping, China's Communist Party chief, designated Shenzhen as the country's first special economic zone, opening up the area to capitalism and foreign investment to spur its growth. Now a sprawling megacity with a population of 11 million, Shenzhen's fortunes are made by manufacturing inexpensive clothes, electronics, and toys for large overseas brands. By the 90s, Shenzhen was overrun by markets, factories, entrepreneurs, and skilled workers, some of whom found their way to an underground culture of Shanzhai-copycat electronics.

They moved to Shenzhen from other parts of China because of the availability of jobs, companies, and money from the government. Shenzhen is the Chinese version of Silicon Valley, home to many large technology companies such as Huawei, Tencent, smartphone brand ZTE, drone maker DJI, and several others. Home to 11 million entrepreneurs, Shenzhen is home to the most well-known Chinese tech companies such as Huawei, Tencent, ZTE, and DJI. Variously called the world's factory, the new Silicon Valley, and the maker's dream city, Shenzhen has an entire ecosystem, with everything needed at every phase of electronics manufacturing in one place.

In 2013, according to an ABI report, Shenzhen became the largest base of consumer electronics products in the world. The company reports that 90% of all electronics worldwide are manufactured in the Chinese megacity, including toys, TVs, air conditioners, cellphones, and drones. Shanzhai is an incredibly powerful force, considering over 25,000 Shanzhai companies are operating from just Shenzhen, which produces one-quarter of the global supply of phones, as well as a huge chunk of all other electronics. Being able to design, manufacture, and ship its own largely cheaper features phones worldwide, the electronics industry in Shenzhen has eroded the existing hold over the market with phones selling for less than $100.