Zhang Ruimin has a plan for entering American homes. The chairman and chief executive of Chinese appliance maker Haier is intent on capturing 10% of the U.S. market for full-sized refrigerators within three years. It won't be easy; the market is now dominated by four familiar brands. But Zhang is confident. And central to his battle plan is a small town in South Carolina perhaps best known for a Revolutionary War battle that the colonists lost.

What Zhang has going for him in Camden, S.C., is a $40 million factory churning out 200,000 family-sized refrigerators. Haier is the only Chinese company to have a major manufacturing base on these shores, and if that seems odd--the traffic is typically in the other direction, since labor costs are so much lower in China--Haier has its reasons. First, it is expensive to ship bulky refrigerators from China. Second, Haier likes design and production to be close to its markets. (The group has eight design centers and 13 factories outside China.) A U.S. factory also allows Haier to stick a made in the u.s.a. label on its products and is a sign to retailers that the company is in America to stay.

If the strategy is unusual, even risky, that's what Zhang's all about. Seventeen years ago Zhang, now 53, took over a nearly bankrupt refrigerator factory in Qingdao, a city on China's east coast that is the home of Tsingtao beer. Today Haier is the world's No. 2 refrigerator maker, after Whirlpool, and has expanded into washing machines, air conditioners, small appliances, televisions, even computers and cellphones. It conquered its home market (29% market share for refrigerators, 26% for washing machines) by emphasizing product quality, studying customer needs, and relentlessly pressing its brand--unusual strategies for China. Now it is spreading across Asia, opening factories in Indonesia and the Philippines. With global revenues topping $7 billion, Haier has set its sights on Japan, Europe, and the U.S.

As shelf after shelf of made in china cuddly toys attest, Chinese products are hardly uncommon in the U.S. But a Chinese company selling under its own brand name is. "It's very difficult to set up a name brand," says Zhang. "But if you don't take this road, you will always work for others."

The company isn't starting from scratch. Since it began exporting to the U.S. in the early 1990s, Haier has captured about half the U.S. market for compact refrigerators, the kind seen in college dorms or hotel rooms. It also pioneered electric wine cellars--those inexpensive stand-alone cabinets for wine lovers who lack drafty chateaux in which to store their treasures. By finding such niches, Haier racked up U.S. sales of about $200 million last year and says it earned a profit, though it won't reveal how much.

The college dorm and oenophile markets will take Haier only so far. To reach his goal of $1 billion in U.S. sales in 2005, says Michael Jemal, head of Haier's U.S. sales arm, "we need core products to attain mass retail presence." That means mainstream items like air conditioners and washing machines and, especially, family-sized refrigerators, the product with which Haier got its start. But while Asian brand names have become common on everything from televisions to cars, the major-appliance market in the U.S. is still dominated by Whirlpool, General Electric, and Maytag. The biggest foreign player is Sweden's Electrolux, which got into U.S. kitchens by buying Frigidaire. The four companies together make 98% of the nine million standard refrigerators sold in the U.S. each year. Haier wants to nibble off 10% of that market by the end of 2005. "Given what we've done in other categories," Jemal says, "I don't see why we can't achieve that."

Getting there depends in large part on what's happening inside Haier's Camden plant. Haier is not assembling parts just from China in South Carolina. Many metal parts and the tool sets to form large forms are shipped across the Pacific, but most of the plastic parts are locally sourced. The compressor is from Brazil. Allan Guberski, a former Amana factory manager who oversees daily operations, says local content is nearly as high as that of U.S. rivals (in part because he wants to achieve NAFTA compliance), but Haier can offer greater value through better designs and production techniques. For example, Haier molds the interior lining of many models out of a single sheet of plastic and blows the insulation in all at once, instead of connecting freezer and refrigerator sections that were made separately. That reduces the possibility of leaks and improves strength.

The Camden facility was built from the ground up specifically to build refrigeration products. Raw materials enter the factory at one end and come out as full-fledged fridges at the other. Guberski is putting more equipment in place to reach 300,000 units next year. "We're very competitive right now," he says, "and we're only going to get more competitive."

To instill that competitiveness in its American workforce, Haier has imported its intense corporate culture--one designed in part to retrain Chinese workers used to the lax standards of that country's state-owned enterprises. The Camden workers are indoctrinated in the disciplines of 6-S. That's an adaptation of the 5-S quality-control movement from Japan, which takes its name from the initials of five Japanese words--seiri (discard the unnecessary), seiton (arrange tools in the order of use), seisoh (keep the worksite clean), seiketsu (keep yourself clean), shitsuke (follow workshop disciplines)--to which Haier added a sixth, the English word "safety." A large open space on the factory floor has a number of small 6-S squares drawn with yellow paint. Work team members take turns standing inside the squares to relate news or offer insights. The factory walls are lined with banners in Chinese and English: A Product with Defects Is Useless or Innovation Is the Soul of Haier Culture. Also ubiquitous are posters featuring drawings and aphorisms by Haier workers in China. One poster shows a ship and reads, "An enterprise, its management system, capital, and brand are likened to a man, a soul, a boat, and a sail."