by Renaud Anjoran in 'Quality Inspection Blog'It is impossible to advise a generic way of dealing with Chinese suppliers (whether they are much bigger or much smaller than your company, whether or not they are used to dealing with foreigners, etc.).
However, when it comes to building and maintaining relationships, there are two traps that many importers fall into:
1. Being too close
Many first-time buyers pick a book about China and learn that guanxi is indispensable to do business there (wrong). They focus on building personal relationships with factory salespeople/bosses. They forget all their business sense, and don't spell out their terms (contract, quality control, payments…).
They are often amazed by the red-carpet treatment they receive. Many of them don't dare to refuse invitations to karaoke clubs… and more.
Then, when problems pop up (for example, a price increase supported by a dubious excuse), they don't dare to say no. Just like they don't dare to insist for an inspection of quality before shipment. Big mistakes.
And, if you are not Chinese, forget about "guangxi." Most importers don't need to play this game.
If you try to sell to a government organization in China, it's different. You'll need "someone in your organization that is well connected and can play the games, pull the strings, motivate in culturally appropriate ways and host the dinners and other events necessary to both keep the doors open but keep others from coming in too often," as David Dayton notes in his latest blog post.
2. Being too distant
This mistake is not particular to beginners. It is usually made by hands-off buyers. They make it clear that they don't care about their suppliers. They switch vendors to save a few pennies. They don't want to spend (waste?) time socializing, even at lunchtime.
The post China Love, on the JLMade blog, describes an "expert" who advises buyers to fall into this trap:
I recently sat in a seminar where a guy, who runs a company in the Western world, which "specializes in China sourcing," was telling the attendees not to make relationships with their suppliers. I couldn't believe my ears.
This guy's logic was that prices are changing too rapidly and there are too many "unknown" factors in today's economic landscape. Don't try to lock in to one vendor but keep shucking and jiving between multiple vendors… always switching (which in my opinion, leads to always "reinventing the wheel.").
The problem is, this kind of one-shot buyer tends to have bad experiences. No one ever gives him priority:
Suppliers and factories typically disdain the overseas promotional product/ad specialty industry and when they know an item is for that industry, they know it is very possible this is the last order they may be getting from this client. The clients are always quoting something new or they have an endless product line and it causes them to deal with a bevy of suppliers… typically seeing how much they can muscle down the price.
If you are categorized as a "bad buyer" by a manufacturer, their management will not look after your orders closely (which means more delays), and they will be more inclined to cheat you (which means lower quality).
Make sure you show your suppliers that you care about their situation, and give them regular orders. Then your China sourcing experience will be much more pleasant.