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Negotiating with Chinese Suppliers

Understanding MOQ — The supplier’s perspective

At the recently concluded Global Sources Electronics show, suppliers offered their take on MOQ. “Everything is negotiable” was mentioned several times, indicating where their point of view starts.

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How to negotiate up to a 5% price cut with Chinese suppliers in one email

by Gary Huang 

As small business importers, you may think that the best way to grow your business is to sell MORE or RAISE your prices. Think again. While often overlooked, sourcing professionals know that the real money is made in PURCHASING. In other words buying low.

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Overcoming supplier communication obstacles

by Jacob Yount

Overcoming China Supplier Communication Obstacles When Importing

When importing from China, overcoming supplier communication obstacles, leads to better quality merchandise and smoother projects.

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8 red flags your RFQ tells supplier to "Work for Free"

by Jacob Yount 

Promotional product and retail product china blog

Supplier motivation is invaluable in China importing.

When sending the RFQ, here are 8 flags importers and buyers frequently wave that tell the supplier to "work for free", thus quenching the fire of the supplier motivation.

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The effective China contract: Liquidated damages

by Dan Harris 

Our China lawyers love liquidated damages provisions (a/k/a contract damage provisions). We love such provisions for the simple reason that they work.

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What not to do when negotiating with Chinese businesses

by Adam Gilbourne 

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China is a massive opportunity for many Australian businesses. It’s the largest economy in the world; it’s still growing rapidly and, equally rapidly, it is opening up to overseas investment.

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Minimizing risk through payment terms negotiation with Chinese suppliers

by Ashish Monga 

In the last post we looked at 8 payment methods you can use to pay your Chinese suppliers. In this post, I will look at “Payment Terms” that go along with the choice of payment method & factors influencing the negotiation of payment terms.

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How to draft a contract for China

by Dan Harris

Contract drafting guru Ken Adams interviewed our own Steve Dickinson for a post he did regarding drafting contracts for China. The interview was in the form of a Q&A and I urge you to go herefor the whole thing.

Steve made the following points, among others, during the interview:

Ancient Purchase and Sale Contract

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Negotiate like a boss in China

by Adam Gilbourne


Doing business with associates in other countries can be challenging at the best of times. Many experts tout obvious words of advice such as carrying plenty of business cards and wearing a conservative suit. But more tailored advice is needed when working in a place with a completely different business culture. China, in particular, has become such a large trading partner to many western countries and if working there, it’s important to gain an understanding of how they do business. Using this understanding when negotiating can help you achieve the outcomes you’re looking for.

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Negotiating in a slowing China

by Andrew Hupert

Will weaker Chinese growth strengthen your negotiating position?

The Chinese economy has been slowing for the last few quarters, and whether it is a controlled application of bureaucratic brakes or the start of a skid into a recessionary ditch, some international business people see China’s deceleration as an opportunity.  International negotiators who believe that a slowing Chinese economy gives foreigners more leverage are, however, over-optimistic at best.  There may be isolated cases were individual private Chinese businesses will be motivated to sweeten their offers in the face of a domestic slowdown, but it would be unwise to assume that  Chinese counterparties are all feeling desperate.  Westerners who calculate that the bureaucracy is going to become more welcoming to foreign businesses need to realize that a couple of years of slower growth will probably make their challenges in Beijing more severe.

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Is it still worth it to do business in China? Conclusion

by Andrew Hupert

Is it worth the effort and investment for foreign firms to do business in China?   The answer depends on who you are and what you want from the market – and that’s a problem.

I spent a month in China trying to answer the question, “is it still worthwhile for Westerners to try doing business in China?”   The international business press has been focusing on Beijing’s prosecution of the infamous Anti-Monopoly Law and use of national security claims to restrict foreign firms’ access to China’s burgeoning middle-class markets.  Overseas readers of the WSJ and Forbes could easily get the impression that foreign brands are being chased out of China on a tide of xenophobic resentment and anti-foreign fervor – but it’s simply not the reality on the ground.

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Is it still worth it to do business in China? Part 4 -- Different earnings models, different bureaucratic challenges

by Andrew Hupert

Western negotiators in China are finally coming to accept that no matter what the deal on the table may be, their most significant counterparty is the Chinese government bureaucracy. The Chinese government has a much different attitude towards international businesses coming to China to buy or manufacture as opposed to those coming to China to sell and market. International managers are still coming to grips with this dichotomy, and it is causing problems and costing money.

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Is it still worth it to do business in China? Part 3 -- Myths about the new China economy

by Andrew Hupert

Last week we talked about China realities.  The ultimate conclusion was that while the Chinese business environment isn’t fair, it’s still the best game in town in terms of growth and opportunity.  As a China negotiator and decision-maker, you have to decide early – go all in or get completely out for good.  China is a terrible place for half-measures.

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Is it still worth it to do business in China? Part 2 – Myths and realities

by Andrew Hupert

For Westerners, doing business in China is going through anther sea change — so this is a good time to take a fresh look at the operating environment as it impacts on international management decisions.

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Is it Still Worth it to Do Business in China? (Part 1)

by Andrew Hupert

Glaxo SmithKline.  Mercedes Benz.  Yum.  McDonalds.  The list of Fortune 100 MNCs getting into high-profile legal trouble in China has been growing – and the severity of problems growing more intense than ever.  With the conviction of a well-known Western consultant and the widespread deployment of China’s Anti Monopoly Law, even the most die-hard Chinapologists are having a hard time arguing that international firms are getting fair treatment from Beijing.  In the past the biggest problem facing Western managers and negotiators in China was the lack of consistent laws – now the problem is too much law and uneven enforcement.

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In Chinese negotiation, don’t confuse polite rhetoric with concerted strategy

by Andrew Hupert

American and European negotiators treat their Chinese counterparties’ “general principles” discussion like the “terms and conditions” screen – we just check the box and look for the real content. Big mistake.

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