6 Common Mistakes Importers Make With Asian Suppliers

You are reading ChinaImportal's Newsletter!   Being in between suppliers in Asia and overseas buyers, we often see the same common mistakes made over and over by both sides. While many issues are caused by the vendor side, importers themselves aren’t entirely blameless either. As such, we thought it is about time to clarify what sort of mistakes importers tend to make and how they can be prevented. Keep reading and learn how you can prevent severe quality issues,misunderstandings and delays when buying from Asian manufacturers. 1. Don’t treat your supplier as a price database Responding to quotation requests from buyers is part of a sales rep’s job. However, calculating production costs take time, and may require multiple subcontractors. If you keep submitting RFQs or changing the specifications, without ever placing an order, the supplier will eventually lose interest and stop talking to you. Don’t treat your suppliers as free researchers, or a price database, and don’t bother them more than what is necessary. 2. Always provide swift feedback and status updates Buyers are often quick to complain about excessive lead times, long holidays and prototype development spanning several months. However, it’s common that buyers wait several days, or even weeks, to provide basic feedback to the supplier. This may relate to feedback on quotations, quality options or even product samples. While I understand that you may have other things to attend to, this is a major time killer. If not the biggest of all. Always respond to emails within 24 hours, and keep the supplier informed, if you absolutely must go off the grid for a while. 3. Provide overly clear instructions. Not written paragraphs. There are few things that are more frustrating to an engineer than a product specification that is written like a novel. Yet, it’s common that importers write long, and often vague, paragraphs, describing the product’s design, quality and functions. Below follows an example: “We want a Stainless steel watch case, with IP rose gold plating. The logo shall be printed on the face, in a centered position. The movement must be a high-quality Japanese movement, with three hands. Please see the attached AutoCAD file and logo file. If possible, we’d like to start with 1000 pcs, but please also quote a price for 2000 pcs.” This leaves the sales person interpreting what your product is supposed to be, which is extremely likely to cause misunderstanding, which in turn may result in disastrous quality issues. Instead, a product specification must be on point, and crystal clear. Below follows a more precise take on the paragraph written above: Please provide a quotation for both 1000 pcs and 2000 pcs, based on the specification below: Case Design File: case-design.dxf Logo File: logo.eps Material: 316L Stainless Steel Coating: IP Rose Gold Logo: Print Logo Position: Centered PS: Please see the file attachments 4. Don’t be too aggressive in your price negotiations While price negotiation is part of the game, and even expected, many buyers go way too far in their attempts to cut pricing. There are two problems that stem from overly aggressive price haggling: a. Contract manufacturers need to make money too Promises of larger orders in the future is not going to make a supplier accept short-term losses. By pushing your supplier too far, you remove their incentive to work with you, and they may decide that your business is not worth the effort. b. You’ll always end up getting what you pay for While a supplier may eventually give into price pressure from their buyers, this comes at a cost for the latter. Forcing a supplier to cut unit pricing may leave them with only one option: To reduce production costs. As explained below, there are several methods the supplier can apply to achieve that: Procure cheap raw materials and components of a lower quality. Procure cheap raw materials and components that are non-compliant with overseas substance restrictions. Cut corners during mass production. What may be perceived as a victory for the buyer, can therefore quickly result in a total loss. While I don’t say that you should accept any figure the supplier throws at your way, you’re wise to apply the following lessons when negotiating prices: A price is of little relevance if you don’t know which specification it’s based on. As such, you shall not even consider sending out a singleRequest for quotation (RFQ), until you have a complete spec sheet. This holds true even for ODM (Private Label) products, which aren’t based on your own design and specification. Never base your target price on an assumption. Request quotations from at least four to five manufacturers to find out where the market price is. 5. Don’t overreact to minor delays and complications Don’t get emotional over minor misunderstandings, delays and quality issues. There are so many moving parts, processes and stakeholders in manufacturing, that it’s utterly unpredictable by nature. This is in turn amplified by supply chains that stretch halfway around the world, and with the supplier and buyer in different time zones. What this means to you, is that you need to be ready for complications, and focus your time energy on solving them, as they come. And, you can be sure that they will come. Always be pragmatic when dealing with suppliers, and understand that issues are often manufacturing and logistics related, rather than exclusively ‘China-related’. 6. Manufacturers are not service providers Wondering why your supplier don’t consult you on applicable safety standards and labelling requirements in your market? Expecting creative input on your latest designs? Don’t. Manufacturers only do what they are supposed to do, which usually don’t stretch far beyond assembly and packaging. They are not one-stop-shops, offering an all in one solution for your every need related to procurement. Everything else from compliance and IP consulting, to quality control and freight forwarding – is up to you to arrange. Talk to us: +60126694217 (Whatsapp/Call) Email us: alveolegame@gmail.com