It gets even better than that. I KNOW how some of it works. Last company I worked for before going off on my own, we designed a new computer case. We paid the Chinese to make the molds and set up the presses to manufacture our cases for us. Before we got the FIRST copy of the case, it was advertised and being sold in "Asian Sources Computer" magazine for HALF our cost.(or less). They were cranking them out on OUR equipment, putting them out the back door - quality or no quality - it didn't matter. They had no upfront costs because we had paid them (quite well, it turns out) for the "development".
Gotta remember , in China there is only ONE rule about doing business
- There ARE NO RULES!!