Sourcing in China

  • September 15, 2021

If you can overcome the challenges of sourcing in China, you’re offered profitable and interesting opportunities. However, it requires that you know how to deal with the Chinese – who often seem poles apart from us in their business thinking.

After the usual mistakes in the beginning, today I would say, that I’ve learned their way of thinking and I can spot typical pit falls. But even now I can still be tricked once in a while. These are just the terms, I suppose.

Challenge no. 1: “Yes” has different meanings
Previously, it was a popular myth that a yes did not mean the same for Chinese people as for Westerners. The truth lies more in the fact that for every message there are 3 requirements that need to be fulfilled before a yes is fully valid. 1) Yes, I have heard the message. 2) Yes, I have understood the message and 3) Yes I have accepted the message.

Accept this and take it into account every time you talk to someone: Did they understand me correctly? Did they hear, understand and accept my message? Then you are ready to head for a decent business deal – the Chinese way… And remember Chinese people are skilled merchants.

Challenge no. 2: Very different culture
Chinese people sell hard and aggressively. But we should be aware, that we are also very choosy and we have very high requirements. So sometimes we think that Chinese suppliers are dishonest whereas they think we are unreasonable demanding. When I look for new potential suppliers I do desk research to find out if he meets our set of objective criteria.

If I decide for a visit I always start with a factory tour to get an impression of the company and how they do business.One of my standard tests is to compare pictures from the vendor’s website with the real places in the factory. Very often it turns out that the pictures are not taken on the premises but come from other places, and often the Internet.

I have visited many potential suppliers and in most cases I must decline a cooperation because there are criteria that are not met. Typically, I would say that when this or that is fixed or improved I would be happy to come again. The next step is communicating our needs.

Challenge no. 3: Different precision
At EA-Connect, we make high complex parts. They can be challenging in terms of dimensions or in terms of cosmetic requirements. They are set by the customers’ 2D and 3D drawings, which prevail over everything else. And common for all our customers is that parts MUST be 100% per their drawings. We cannot compromise on that.

However, many Chinese manufacturers run by a different principle. This is the “good-enough-principle”: If they believe that a certain part meets its functionality requirement, then it must be good enough. This is where it often goes wrong. As for dimensional issues, for anything measured in units, inaccuracies can easily be determined, and the need for arguments to adjust the product is less.

But with cosmetic issues like for instance color or surface treatment it’s an entirely different matter. The color white, for instance, has a wide variety of interpretations. It can be very difficult to avoid variation because chemical processes are hard to control. And often the judgement is subjective rather than objective.

Chinese suppliers – are not suited for long distance relationships
To imagine that sourcing in China can be done long distance is naïve. You have to communicate closely, you have to physically meet them face-to-face, and you have to do close follow-up to ensure you get the right product in the right quality at the right time.

One thing is for sure: once I’ve found a supplier, who is reliable and quality conscious, I value and nourish our working relationship. It’s extremely satisfactorily to be able to offer our costumers fair priced solutions matching the requirements – it is definitely worth the effort, if you ask me.

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