QUESTION: What do you care most about when you are sourcing products from China ? Some will say price, (that's for sure), others will say quality (which is of course a must), and still others will say service(Great you wanna service ). So what else is there to be concerned about besides price, quality, and service? What I'm trying to say is that whether it's price, quality, or service, all three come together in one place - "cost-performance"!
So what is "cost-performance" ? My understanding of "cost-performance" is that a product can achieve a perfect balance between price, quality, service and professionalism. If the price of a product is very cheap, do you dare to buy it? Conversely, you wouldn't buy it if it was expensive. The same goes for quality. You won't buy a product if its quality is poor (because poor quality definitely affects your end customer's experience). But if the quality is good, the price will be high, and that will be out of your budget. I believe that any buyer or purchasing manager is looking for a supplier within the company's given price range who is happy with the price, quality, service and professionalism. (I won't say factory here, but rather supplier. I'll explain that later.)
I believe that most of companies likes to do business with "professionals" because time is precious and dealing with unprofessional people is just a waste of each other's time. And professionalism is also included in the "cost performance". Many times when you go to the factory to find cooperation (I know many buyer or companies likes to work directly with the factory, cause they think this can directly get the lowest price and the best quality), but when you communicate with them, you will find that it is a disaster, many times what you want to say and what they understand is very different. Some people will ask, why is it so hard to communicate with the factory? Let me explain to you!
1st, as the factories are always focused on production, they do not have the opportunity or time to approach foreign buyers or companies, thus they do not know how to communicate with them.
2nd, the different way of thinking is also the main reason for not being able to communicate properly. First of all, allow me to describe who would normally work in a factory or who would start a factory. Usually it is the less educated who choose to work in a factory (mostly junior high school graduates), but it is the huge difference in culture and education that limits their way of thinking and makes it difficult for them to communicate with international buyers.
3rd, the professionalism of factories is far less than that of trading companies. Although factories are familiar with the whole production process and the price of raw materials, But they do not know how to express themselves accurately and professionally, which is the main reason why they are limited.
4th,when you come to factory to asking, the quotation may not be cheaper than the trading company or agent, because we are Chinese we understand their way of thinking, know how to talk to them about prices, and the right communication.
At this point some people may say, in China there are also very good factories, not only understand the whole production process, but also know how to communicate with customers. I would like to say, yes there are many such factories, but once you compare the prices given by such factories, you will find that their quotes are relatively speaking a lot higher (because of the input costs), so this is contrary to the principle of "high cost performance". In fact, I know a lot of European and American companies do a lot of their products are actually not all from those professional factories, on the contrary, from those "cost-performance" factories.
At present the whole supply chain in China can be said to be very mature, a lot of production technology is almost open, the quality of the products produced by small factories has not lost to those professional factories. Their only disadvantage is that they don't know how to promote themselves (or can't promote themselves).
So, our goal is to gather all the good factory resources to provide our customers with cost-performance products. Maybe our customers don't know where there is a cost-performance factory, but we do, because our daily job is to find and select the real cost-performance factory.
If you know Li & Fung Limited, then you know that this company, which is famous in Hong Kong and even in the world, does the main job of bringing together all the advantageous factories in China to serve them.
Now days , the big international companies such as Wal-Mart, Costco, Sam's Club, Best Buy and so on, they seldom work with factories directly, they send orders to domestic buyers in their own country, then the buyers send the orders to buyers in Hong Kong, then the Hong Kong buyers send the orders to Shanghai. and finally the Shanghai buyers to the following factories. Of course, with the economic development of mainland China, more and more international companies will skip Hong Kong and choose to open offices in Shanghai directly. We had a direct contact with Forever 21's Shanghai office to discuss the details of our order.
Finally, I would like to say that in international trade, "cost performance" is always the first thing you should consider, because a cost-effective partner can bring you benefits that are far from being replaced by price. I will share what you can expect from a cost-effective partner next time,
Thanks for reading!