Some Suggestions from Several Senior Foreign Purchasers

A question was once asked on Quora, the us version of zhihu:

It was not expected many buyers to reply, including some who have 10 years of import experience in China. Cut it off at random:

Why is it difficult to do business in China?

1.   Carl Johnson, Seven Years of Purchasing Experience in China

When doing business in China, I noticed some "strange" things. For example, it seems easy to do business, but I find that the founders of many companies don't really know how to run a trading company properly.

In addition, many businesses in China are based on interpersonal relationships. For example, B knows C (C is a small tools manufacturer), B knows A, and A knows who wants to buy gadgets, so B starts selling gadgets with A, but they are neither suppliers nor purchasers, let alone business philosophy.

I have tried to purchase products from well-known local enterprises, and made questions and requirements on quotations, specifications, colors, categories and so on, but I found that the salesmen did not seem to understand their products. The quotation they sent me may be a simple e-mail in most cases, or even a short message with only one price(this is really true). But there is no product classification, no terms, no specifications, it is difficult to imagine that this is from a well-known company.

Second. Chinese suppliers seem to need an order with bog quantity. If you don't order a large quantity, you will probably not get a reply and will not be their preferred customer.

The third point is language. This trade barrier is understandable, and we now have a lot of technology to help solve this problem.

The fourth point is that Chinese people always want to make more money. Therefore, if they can save 50 cents by slightly reducing the quality, they are likely to do so. I think this may be a different mentality between China and the West.

Some Chinese suppliers reduce product quality just to save 10 cents, westerners think it's not worth mentioning when compared with the product returns or complaints they may encounter later. But some Chinese businessmen seem willing to do so to make more money, which may be just because they have different business ideas.

Every item I mentioned above is not intended to criticize anything. It's just my observation of doing business in China over the past seven years. Interestingly, even the Chinese do not believe that other Chinese companies can provide high quality products for a long time, but this can not be said that China does not have high quality suppliers. It's just that there are too many businessmen here. You have to go through a lot of screening companies to find good suppliers.

2.Ray L. Maher, with more than 10 years of import experience from China

Suggestions for foreigners who want to do business in China or buy from China.

2.1 In China, it seems to be a custom to have business lunch and dinner with your partners. Usually, dinner is more grand. This is also an excellent opportunity for you to get to know each other and strengthen your relationship with your suppliers.

2.2 China is so big, so don't expect you to visit a factory in Shanghai in the morning and another one in Guangzhou in the afternoon, unless you like to go and see flowers or buy tickets in a hurry.

2.3 According to the statistics, there are millions of suppliers, agents and individuals in China. They are willing to give you a detailed introduction and try to persuade you to place an order. But before placing an order, please carefully check the quality of suppliers.

2.4 For most products, Chinese suppliers can produce Wal-Mart quality or high-speed rail quality. It really depends on how much you are willing to pay for the product and how much control you have over the quality of the product.

2.5 When Chinese say yes, it's likely that it means "no" in English.

2.6 Chinese food is rich, you can always find your favorite food. Don't worry about that, but you have to tell your translators what they don't eat or what they are allergic to.

2.7 When you travel to China on business, if someone stares at you while you are on the road, it is not because you are beautiful, but because you are strange.

In a word, it is always "challenging" for you to do business in China because of big and small events.

3. Barry Wong, who has six years of experience in electronic products trade

My answer is based on six years of electronic products trade with Chinese suppliers. To be honest, there are many very strong and good companies in China, but there are also some not so good companies. They are excellent at domestic products, but they seem to have lower standards for international business, which is very puzzling.

（I do not know how Barry wong come out this point, usually Chinese suppliers good quality for international, and lower quality standard for local）  

I think the reasons are as follows:

The main reason should be the people who run the company. Profit and quality often become "opposites", and product improvement takes time. For example, it's hard to come up with a report that requires a factory with 200 or more people to provide a formal specification, and local standards are usually not higher than global standards. This means that the whole company needs to change the process from beginning to end, which in my opinion is very difficult.

Secondly, the stability of the company's employees。As far as I know, every year during the Spring Festival in China, one third of the employees of the supplier company I work with will return to their hometown and never come back. We call them " migration workers" because they are so mobile every year.

Some companies have worked out some solutions to this situation: for example, the employees who go  back for spring holiday will not be awarded the year-end bonus until in July next year, if they do not come back for work after spring festival, means they can not get the year-end bonus. It's not a joke. It seems that many companies have proved that it works.

( I always think this is serious problem for many Chinese companies, think about it, it takes 2-3 years to train a skilled worker, and normally the workers change a company every 2 or 3 years , means the companies have to spend time and money to recruit new workers and training the new workers, At the same time, production will be seriously affected during the transition period.)

The last reason is the desire for profit. Pursuing profits is not shameful to me, but making money by reducing product quality is not acceptable to our purchasers, because we are the end up paying for the product. In addition, skills training are difficult to keep up with because of the high mobility of personnel. So it's not surprising why a company with more than 400 employees sells products without knowing anything about them. All these make us difficult to continue working with them.

4. Clive Jones， having years of import experience from China

Many Chinese companies do not have hierarchical management responsibility system, which means that no matter how big or small things are, the boss has the final say. Therefore, as far as other employees are concerned, if the buyer wants to purchase from him, it is actually purchasing from the boss. Besides, I have met some bosses who are very alert to people they don't know（ it is strange maybe they make illegal products?）. I asked, "Why do many Chinese companies seem to only do business with other Chinese people?" He said, "Because we know how the other side deceives us. It's called know the enemy and know yourself."  ( it is not true, many Chinese manufacturers are more willing to do benisons with foreigners, because they have good price and good payment term, yes, some companies do don’t like making products for foreign companies, that is because foreign products have quality standard, especially when they have enough orders form local)   

Bargaining is a way of life. Chinese people say they like shopping because it's interesting because they can concentrate on bargaining. They feel that as long as the price is low enough, they will attract customers. So in China with a billion people, they don't have to worry about brands, years of operation or any Western concerns, and sell the right products at the right price, that's to get job done.( Bargaining is really not common anymore, there are many places you can bargain, Supermarket no bargaining; Department Store no bargaining; Exclusive shop no bargaining; restaurant no bargaining, only small clothing store you can bargaining, and other stands, really not many. They do care about their brand, reputation and history)

Patents may also be interpreted here as copyright. There are many Shanzhai products in China, so the prices are totally different. Of course, the quality of products will vary, depending on the choice of buyers.

5. Berkes with one year's import experience from China

I have been doing business in China for a year and I find it easy. I majored in tool manufacturing in college, so I didn't find it difficult to do this kind of product business. Communication about product design issues or language communication seems to be no problem, because I hardly need to speak Chinese, technical issues are easy to understand each other.

I used to come to suppliers with drawings designed by my American colleagues. Once they told me that they had the ability and could easily complete these parts, I would immediately verify the equipment and technology. But unfortunately, many factories do not have such ability in actual production, which is probably the only difficulty for me to do business in China. So I spent a year auditing big factories in China, but that's not because it's hard to do business with Chinese people.

6. Business Consulting Company with more than 40 years experience.

My observation is as follows: in China you need to have a strong relationship, otherwise you can hardly succeed.

Secondly, in general, there are some businesses or negotiations in China that require you to "under the table" or carry out in a Chinese way, and everyone involved needs to be one of them. Sometimes their relationships are more elusive than understanding the value of the product.

Finally, quality always comes after price. But even so, the potential of China's consumer market is enormous. If you don't have a significant competitive advantage, or know some industry-related people, then it's very difficult for you to succeed in China. But for those who dare to take risks, the vast number of suppliers in China is undoubtedly a very suitable candidate.

These are the personal feelings of some foreigners or foreign purchasers who have been doing business in China for many years. Perhaps they have some inspiration for our Chinese manufacturers and enterprises. It is hoped that Chinese companies and enterprises will have a better understanding of international practices and rules, as well as the cultures of the West and other countries, so as to enhance the image of Chinese companies and to do business with people all over the world.