Purchasing managers in China can expect to meet up with 3 kinds of overseas suppliers. Some know China well and have good experience operating here. Others are new to China, and don’t know much about doing business here – but they know it. This is a great opportunity for building a solid relationship and securing a key supplier. But there is a third group that doesn’t know China at all – but believes they do. This is trouble. Whether it’s a manager with experience in Korea and Japan or a young overseas Chinese who knows a few words of Mandarin, these guys are going to give Chinese purchasing managers a lot of grief. Make sure the business justifies it.
Dealing with the 3 kinds of western counter-parties.
- They Know China. Don’t make problems where there aren’t any. Deal with this guy in a professional, businesslike manner, and you’ll win the day. You be a pro and he’ll be a pro. He doesn’t want to hear how good his Chinese is or how he’s been her for so long. He probably knows the market and can judge how reasonable an offer is, so make sure your expectations are reasonable and you don’t go for too much at the beginning.
- They Don’t Know China. This can be a great contact – if you handle it the right way. Is this guy a new hire or transfer with one of your long-term suppliers, or is he cold-calling for the first time. When dealing with a China newbie, your first job is to figure out how long he’ll be around. If he works for a small firm and is just testing the waters with a few sales calls, then you don’t have to invest too much time or energy into teaching him too much. But you can expect to see more and more expats and overseas managers ‘cycling through’ Shanghai for a few years. As China becomes a more developed market, you can expect to see more young management-types put in time here in order to round out their global management skills. These can be valuable contacts, so take the time to orient new suppliers and salesmen to the way you do things – and to the way things are done in China.
- They don’t know China but think they do. The problem here is suspicion and inexperience. If your counter-party ‘thinks he understands’ your situation, then it usually means that he is skeptical of your claims and suspicious of your motives. Your best bet with these guys? Be their second deal. They’ll be fine – once they make their mistakes with someone else. But if you have to deal with a skeptic, go right to the issues he cares about: price, payment, scheduling and referrals. If you can make a new Western counter-party comfortable with your firm in those areas, you are well on your way to a successful deal.
One thing is certain: As businesses around the world try to access the China market, there will be a wider range of sellers trying to convince Chinese purchasing departments.
