BE CLEAR

The home furnishings company where I worked had a large order from a major US retailer. We contracted accordingly with a vendor in Zhejiang Province to make the order. It was a significant amount of work for both our company and the vendor because the product had to go through several modifications to hit target costs while not compromising the original design. Our customer did not make it any easier for us by constantly changing their mind about the retail display packaging. We finally got an approval for one of the samples and told the vendor that we were ready to place the order. We gave the vendor a 30% deposit and they began production. They were well along in production when we were told by our Sales Department that the product would be subject to third-party testing, a requirement that was divulged to our company at the last minute. The result was that the product did not pass testing, the customer did not place the order and our company got into a rather acrimonious exchange with the vendor about who was responsible for the units that had already been produced. All of this could have been avoided had there been more aggressive communication and better understanding between our Key Account Sales Dept and the customer.

I have seen this happen any number of times. Overseas buyers will give a China vendor an order without a clear understanding what that order entails, in terms of design, lead, time, testing requirements etc etc.. Companies will load endless last minute product changes on their China vendor failing to understand that these changes involve significant investment of energy and cost on the China side. The message it sends to the vendor is that not only are you NOT organized, but you expect the vendor to be at your beck and call. Most vendors will not react favorably to this and it will only have a negative impact on current and future orders. And some vendors will regard your lack of organization as a weakness and seek to exploit it by raising costs or delaying delivery.

Present yourself as a model of efficiency to your vendor. Do not give them any chance to question you or how you do business. Do not just assume that because you are their customer you can have them operate on your timeline. Work with your vendor, not against them.

THE EAST ASIA COMPANY