by Renaud Anjoran
Many importers negotiate a shipment date (ETD) with their Chinese suppliers before orders are issued, and then fail to follow up on the production schedule.
I think they would avoid a lot of bad surprises if they asked for regular updates.
Chinese suppliers know that asking for 3 weeks of delay is usually rejected. The purchaser might respond “if you ship that late, you will have to pay air freight”, or “in that case, the letter of credit will not be valid anymore; the order is canceled”.
So what do savvy exporters do? They do not reveal the situation clearly and in advance. They wait until 1 or 2 weeks before original ETD, and they announce a one-week delay “because the materials arrived late”. Then another 5 days “because of power shortages”. Then another 5 days “because we do not have enough workers”. And so on, until production is three weeks behind schedule.
This process can be devastating for an importer who promised a delivery date to his domestic customers, and who has to postpone it again and again.
Photo credit: http://www.flickr.com/photos/asurroca/51024419/sizes/m/in/photostream
Before issuing an order, you should ask for a few milestones. Here is a list that is probably too long:
Then, when you reach each milestone, you can ask your supplier whether it was achieved. If not, they should update all remaining dates.
Sending someone in the factory (e.g. your purchaser, an inspector…) is a good solution to check the production status. At the same time, you can verify product quality.
If you really need to stay on top of production, you should do as described above.
But you need to find the right balance.
If you place orders with many suppliers, you might not have time to follow all these dates. And if your orders are not very large, you might not want to bother your suppliers with so many updates.
In such cases, you can reduce the number of milestones.
For example, you can track these dates: start of production, 20% of order completed, 100% of order packed, and shipment date.
The most important is to keep some visibility over the production schedule.
Maybe some readers can share their experiences?