5 Tips for Negotiating and Dealing with your Suppliers in China – 2

Tip #3. “Understand perfectly the production process”

Here I’ll tell you one of my horror stories:  A supplier started giving me excuses and delaying production. He claimed he had some issues with his glue supplier and the glue was not reaching him…. Later on, I realized he did not need any glue in the production process! The part for which he claimed he needed glue had to actually be sealed with heat. That time I believed it!

My lesson: You need to absolutely understand the production process. “Here you cut, here you paint, here you glue…and it comes out from that machine over here”. It sometimes helps to “train” yourself with suppliers that are not your main choice. That way you get to see the machinery, understand the processes, and once you sit in front of the one you are really interested in, you have already developed the know-how on that product, can show expertise and build good credibility.

Tip#4. “Always be ready with back up options”

I once had a confirmed order for which all the negotiation and product sampling had been done. It needed to be produced immediately as we had a tight deadline with a shipment the following week. When I arrived to the factory the supplier said he couldn’t start. I never found out what the problem was. “My boss is not here, the price is not right”… all type of excuses, the clock ticking and no production starting….

My lesson: Always have back up options identified. 4 to 5 suppliers that you have already visited and that you have ensured are capable of producing the product.

Tip#5. “Be very strict with your quality control. You will annoy them but the loss is on you if something goes wrong”

I always go to the factory when my products are being made. I don’t tell them what day or what time, I just show up.

When production has finished I personally inspect the product. I randomly inspect 10 to 30% of what has been packed. I make them open the boxes and I check the product is complying with the agreed specifications. I once made them open 300 boxes because I was not completely confident about the supplier.  They obviously don’t love it, it has a cost for them, but I don’t care. The loss is on me if something goes wrong.

I also wait till it has all been packed in pallets just as it will be supplied to the forwarder. Some suppliers don’t understand that the pallet may move 20 meters in the ship. It needs to be absolutely secured.

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