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pauldla
11-01-2009, 10:29 AM
#1: Introduction

If you’re interested in sourcing from China, here are a few words of advice I’d like to offer. I don’t claim to be an authority on the matter, and I’m not laying down the law (well, not usually: you’ll know when I am!). But I thought readers might benefit from some opinion.

The most important thing is not to try doing it on your own. You’re going to need some kind of agent or partner on the ground here in China, who knows the language and culture. This also needs to be someone you can trust. One thing which you become very aware of not long after you hit the tarmac here is that China is a really, really foreign country, and you tend to be most forcefully reminded of this when you think you’re on firm ground. You need somebody in your corner.

The first problem you’re going to have is of communicating what you want to happen. The Chinese can be very good at greeting your requirements with a hearty ‘No problem!’ and then doing something else completely. One little linguistic nicety I learned though bitter experience is that many Chinese confuse ‘I see’ with ‘I know’. That can cause all sorts of havoc, tension and bad feeling. In addition, sometimes the most innocuous of requests can be inexplicably stonewalled or denied. There can be a multitude of reasons for any of these, ranging from communications breakdown to cultural misunderstanding, but from your point of view you want to keep them to a minimum. How do you do this?

Well, it helps to have an idea of the culture you’re dealing with. Even if you’re not spending much time in China proper (in fact, definitely if you’re not visiting China often) you should try to get advice from others who have dealt here. If you know somebody personally, that’s great, but you can also make contact with many on the web: it can be useful to look at sites like alibaba to get an idea of the kind of problems people are having doing business in China, and how they are resolving them.

Your friendly neighborhood forum guy (e.g. yours truly, in a shameless plug) is also happy to deal with any questions you may have.

Sites like alibaba can be really useful, so long as you treat them carefully. From my own experience, they’ve been much more use as a cautionary example than as a source of suppliers. You’ll find many offering their services as ‘your-man-in-Shanghai’ types, followed by a gmail address and an apartment address. Some of these contacts can be useful, some can be complete time-wasters, and stay well-clear of the ones who will accept Western Union. Don’t be pressurized into anything, take your time sounding people out, and remember, if it seems too good to be true, it usually is. Caveat emptor certainly holds true for modern-day China. This is not to put you off the idea of sourcing from China – after all, many do so successfully, as you can see by reading the ‘Made in China’ labels around you - but just to remind you: be careful. There do be sharks in these here waters.

So much for our introduction. TBC.

Dan Furman
11-02-2009, 10:34 AM
One thing I learned while doing copywriting for a company in China is how the different cultures generally look at price negotiations.

To the Chinese, when you negotiate price, you are oftentimes really negotiating quality, either in products or services. This is key, because when an American negotiates price, they are usually negotiating profit margin. It's a big difference.

So yes, when you hear that "no problem" for a lower price, the Chinese businessperson thinks you want a lower quality product (which is cheaper).

esprithk
01-10-2010, 01:12 AM
well, Dan...

it's important to mention that you write down the quality requirement, such as medical grade material (for health product), or product weight/thickness, etc.
and also includes printing requirement, packing requirement, to go along with the price negotiation.

attention to details are important.

esprithk
01-10-2010, 01:14 AM
pauldla,

you are already a HK based company!
you still need a local chinese to negotiate things with suppliers for you?

this cannot be right.

I am in the same position as you, but I do everything myself.
but that may be I have lived in China since 1993 and been in the manufacturing side.
so I speak the same language as the point of view from a manufacturers.

huggytree
01-10-2010, 03:08 PM
So yes, when you hear that "no problem" for a lower price, the Chinese businessperson thinks you want a lower quality product (which is cheaper).

when a customer tells me they want a lower price its exactly what it means to me...they want a lower product...in my business price and quality go up and down together...

billbenson
01-10-2010, 03:31 PM
Here's an article where a contrarian investor sees an economic crash in china.


contrarian-investor-sees-economic-crash-in-china: Personal Finance News from Yahoo! Finance (http://finance.yahoo.com/retirement/article/108534/contrarian-investor-sees-economic-crash-in-china?mod=retire-planning)

pete
01-11-2010, 11:10 AM
Sites like alibaba can be really useful, so long as you treat them carefully.

Alibaba is a minefield. They should change the name to Scammers, Inc.

And the Gold members just means they paid to be a gold member and the check did not bounce.

I have two businesses in China, one is a partnership in a trading company selling electronics and the other is with a lady who does business verifications in Shenzhen by actual visits and elsewhere online.

One recent "factory" she checked turned out to be a guy riding a motorcycle with a cell phone, picking up items today to ship tomorrow.

Another turned out to be not at the address listed and when she called the phone number it turned out to be a personal phone of a lady who had worked at the company but left over 2 months before. They were still showing her personal phone number on their website. She said she knew the office had moved, but did not know where.

These are the factories you see listed on Alibaba and similar Chinese directories. The only one to even begin to trust is Global Sources, where they truly do investigate and verify companies. And even there we have found "factories" that were simply wholesalers / trading companies.

yoyoyoyoyo
01-15-2010, 08:22 PM
hahaha, wow.

Where to begin?

My real first web-venture was the bright idea of buying products from China, then selling for a higher price to Americans.

Can it be done? sure.

Does it work for others? yes.

Does it work for all? no.


A lot of the difficulties I had was, obviously, a language barrier.

I would make it a point to communicate using small words like "dog", "house", "food" instead of using words like "bio-engineering", "structurally-challenged", "illiterate", etc.


Then you have to worry about whether these people are able to give you a steady price to produce these products, or if they are going to (strategically) wait until you have based your entire company catalog on the products THEY provide, to get you hooked on a higher fee... and make it so you have to change your numbers later on, which was the game they had played the entire time.

Then, let's not even get started on the shipping costs. FOB Shenzen almost costed me as much as the products were worth themselves! (so do that smartly)

---

Also, like the OP said, I am no straight up expert on China...

but there is a difference in how they negotiate, for sure.


What I have noticed is, as a general rule, what the chinese people i've encountered have done; was to speak about a product, then literally stick their hand out for the metaphorical handshake, and say "you can have this for X amount of dollars"

Whereas, in America, when you go in to a store: you see a product at a certain price, and you either decide whether you want to spend it on that price or not.


You will find harsher negotiations going on with salesmen in China than in America... at least that has been my experience.