why you shouldn't deal with china!

[thxebay]

Two product experiences from China.

One Ralph Lauren Polo Shirt- $20 USD/ Retail was $60 at the time
Was it real? Heck it looked authentic as hell

3 Apple IPods.....man I got burned $200
They were bad knockoff's with 'extra' features....sad...I did sell one though but mentioned everything about it. The rest to my neice and nephew. They work good, just not the real deal.

[kundi]

great advice.. I have stop working with 1 guy from China.. he actually scammed me into buying a stolen good

what products do you sell

[teabenny]

Yes, Chinese tend to cut off their nose to spite their face. Their thinking is "There are 1.3 billion more where you came from, so who cares if you're unhappy?" And that's just domestic potential!

When dealing with the Chinese, NEVER use a Chinese interpreter. Use a westerner fluent in Chinese. There are many in China, just looking to put their skills to good use. A Chinese interpreter can be bullied by the Chinese side into not translating certain things for you, while a westerner - who is outside the system - won't be. Also, Chinese interpreters on their own will often decide what you do or don't need to know, which can have a big impact.

Good old-fashioned racism comes into play, too. Chinese have a chip on their shoulder when it comes to things like the Opium Wars and other historical grievances. It's immature, yes, but it's a real factor in their attitudes towards foreigners. They often believe that Whitey shouldn't make money from Chinese people. As their saying goes, "If I cheat you, it's because you're a stupid foreigner. If you cheat me, you're an evil foreigner taking advantage of the poor Chinese." Simply put, the Chinese will take care of their own and back each other up against outsiders. They can be merciless towards each other, but when it comes to Chinese versus outsiders, the mysterious bond of being Chinese comes to the fore.

Don't forget the corruption in China - rampant! Foreign businesses are cash cows ripe for the plundering.

Always insure your goods, be on the ground, give face to the right people (the ones in power rarely announce themselves, you have to watch the crowd you're introduced to to spot the boss), never ask for opinions but give orders (you ask 6 people and you'll get 6 opinions and then a lot of arguing), and draw as little attention to yourself as possible. Don't let Chinese employees anywhere near the money or paperwork.

Even very big companies - like Motorola and Pepsi - have been burned.

[BioSpherical]

My experiences with Chinese business up till now have been amicable. I ordered some mobile phones from one supplier and one was faulty but they sent a replacement unit without any qualms and left me happy. I'm avoiding buying branded goods (such as Nokia, Samsung etc.) though, as although the seller may claim they are 100% authentic, often they are not.

Also, off the topic - isn't it strange how China still claims to be a Communist country yet it's economy reflects that of a thriving capitalist nation? Why doesn't it simple make the full leap into capitalism?

[schumi]

You get people who look around on the internet, are to stupid to do a little research and get scammed by someone they think is in China, when the scammer is most likely someone sitting at a desk 4 blocks down the road telling you they are a supplier from China, and you were dumb enough to take the bait. I have dealt with hundreds of suppliers in and around China, (I own a international broker business) yes there are scammers in China. But what would you say if I told you I wont deal with American suppliers because I got scammed from a guy in Mass? Because I have, but that doesn't make me say I won't deal with American suppliers. There are scammers all around the globe, its what you have to deal with on the net, so get use to it, learn how to identify a scam, or get out of the trade business, and use a broker.

i have to say that you have a more objective standpoint!

i'm chinese,my English is poor,but it's no selection that i must point out something.
because i think i know more about chinese than you.
i don't agree that saying"you shouldn't deal with china",in deed,in China,there's someone often do scamming,not only to compatriots of their country,but to many foreigners who deal with them,however,it's not particular for China,every country has some unlawful or immoral citizen,especially,China has the population of more than 1.2 billion ,maybe you have heard that "what forest birds have large, can not be ruled out",in addition,it's not long
since China found a state,whose legal institutions is still not perfect,so that the government can't hold back all the crimes,then some cases happened like above,but it can't stand for all the Chinese,most of the Chinese have the excellent character of diligent,honest and hospitable.
Actually,with entry to WTO,great changes has happened in China's legal institutions,Chinese government also promise to protect benefits of foreigners especially dealers coming to China,we welcome people all over the world to trade with us very much,which will benefit us two ,as said above ,many Amercan use goods made inChina,and Chinese also derive benefits from American high technology,communicate between us will be strengthened than ever.
It cannot be denied that we have many differences on language and culture,but i think it doesn't matter,didn't you see more and more Chinese students learn English ,meanwhile,many people from western countries begin to learn Chinese?
Like other dealers,i'm dealing with America and other western countries,for we both have the need to communication,but i promise that i will never scam any dealer ,which isn't our want.any interesting,you can come to view it:
www.sourcingmap.com
and if you have any problem,you can contact me via wei.zhang@ux168.cn
Thank you !

[schumi]

Yes, Chinese tend to cut off their nose to spite their face. Their thinking is "There are 1.3 billion more where you came from, so who cares if you're unhappy?" And that's just domestic potential!

Good old-fashioned racism comes into play, too. Chinese have a chip on their shoulder when it comes to things like the Opium Wars and other historical grievances. It's immature, yes, but it's a real factor in their attitudes towards foreigners. They often believe that Whitey shouldn't make money from Chinese people. As their saying goes, "If I cheat you, it's because you're a stupid foreigner. If you cheat me, you're an evil foreigner taking advantage of the poor Chinese." Simply put, the Chinese will take care of their own and back each other up against outsiders. They can be merciless towards each other, but when it comes to Chinese versus outsiders, the mysterious bond of being Chinese comes to the fore.

History,we can't change,but please face squarely to the realism.

[jrod31]

We are actually doing business in china as we speak, but one thing is for sure... you have to travel to china and meet the people that you are going to do business. We actually establish a relationship with someone that we could trust and before they ship out our products that person makes sure everything is good to go. we have done business with china companies, they have told us that if we purchased a certain amount of product we will have exclusive rights....that they wont sell to the end-user. well we have found out that some of our clients went behind our back and purchased products from the company in china...so we had to sit on our product for a while..... they are all about the fast transaction. but overall it does pay to do business in china.

[HiTechGadgets]

I have done import/export for a year and i am now working with a chinese factory that deals with mp3/mp4 players. The one that is selling very well is the touch screen mp4 player. I have worked with the manager of the factory for a while now and they make sure i get the best quality and price. I would suggest anyone to start by building a relationship at a point you would be able to trust each other. The move on to small orders and do your research before you deal with a company or factory. I have been scammed before and i have learned from my mistakes. Anyone interested in knowing more or doing business please pm me.

[teabenny]

History,we can't change,but please face squarely to the realism.

I'm not sure what you mean here... please don't use a machine translator.

I'll take a guess though... you think that if Westerners get ripped off, they deserve it?

Anyway, it's possible to do business in China, but be careful. There are few avenues of recourse should you get burnt, and Chinese judges and officials will tend to be biased towards the Chinese side.

Basically, the best thing to do is buy from the Chinese. They tend to be a lot more reliable partners when you're taking their goods and giving them money.

[schumi]

There are few avenues of recourse should you get burnt, and Chinese judges and officials will tend to be biased towards the Chinese side.

I don't think that,on the contrary,in my opinion,some Chinese officials often show undue favor to foreigner,for they can bring more investment for them, which is good for building up a
better investing environment,of course,if it exists indeed,it just track most of other countries,so when you invest there,you may meet the same problem like that.

[teabenny]

They don't show undue favour to the foreigner in a dispute - especially if the Chinese side has bought the judge or official. You do know the word "Guanxi", right?

The only time the foreigner is shown favour is when he is still a potential investor. They want his money so they are nice to him. Afterwards, you need to be careful.

[Trueintaiwan]

The original poster makes some good points about doing business in the Middle Kingdom.

There are a few reasons why doing business in China presents risks that many small businesses are unprepared to deal with:
1. Rule of law is spotty. There are laws governing ethical business practices, but they are often selectively enforced. Most small businesses do not have the resources to gain an understanding of local laws and how they are (or aren't) enforced, and most SMEs do not take the time to get to know local government officials so that they have recourse in the event of a dispute.
2. Corner-cutting is currently the norm. What you see in the international press about lead paint being used on toys, exploding tires, and poisonous pet food is indicative of the stage China is at right now in its economic development. These manufacturers WILL come around to Western ways of thinking about quality, and probably sooner than you think. However, in the meantime, any company having products or materials produced in a Chinese factory would be wise to plan follow up visits (on short notice from time to time) during the production phase. If you can afford to, and can find, a trustworthy local consultant to do quality checks, it might be worth the US$1-2k a month in costs to hire someone part-time. Most small business owners fly in on a quick buying mission, tour the "show factory," are promised the moon and, soon after returning home, find out that things aren't as easily arranged as they'd hoped.
3. Chinese people are trained not to say no in a sales situation. In Chinese culture, saying no is rude, and will only be employed when the supplier has more power than the customer, and you are discussing a cost issue that the supplier can't, or won't, give in on. SME owners often feel as if they can't get to the bottom of their problems in China, because they can't get a straight answer. The best way to cross the communication bridge is to be present, at the factory, for as many days as it takes to get an open dialog going. You will probably have to go out with the factory boss and have some drinks together, do a bit of karaoke singing, before you can really talk openly. You can hire someone to do regular relationship maintenance, but you'll need to visit (and go out drinking) often enough to establish a relationship of trust with the boss.

It is also true that you will be told by a sales rep that their factory makes the part or handles the OEM work you want done, only to find out that he is a few layers removed from the actual factory. There are several ways to get around that, but it is late where I am, and I've got to get a few winks.

Cheers everyone.

[teabenny]

Jeez! What if you're courting a dozen potential suppliers? You could be in-country for months! Haha

[frida_8523]

A big part of the problem is that so many Chinese businesses only care about the immediate deal, and try to make as much money as possible. They do not see the potential for many, many orders to follow.

One of the biggest factors that makes this type of business practice possible is that most of Chinese business remains cash based, and as a customer sourcing something, you're going to pay 50% cash up front and 50% when the order is ready. In general, there are no terms given. You don't get to pay in sixty days. If something goes wrong, your money is gone. You will never see it again.

Communication is the biggest obstacle right now between China and the Western world. If you are fluent in Mandarin or Cantonese and can read this posting as well, go and spend time learning up on Chinese business and go there. You will become one of the most valuable pieces of business real estate, because you can communicate between two very very very different worlds. This is something both sides need.

The Chinese supply chain is driven by ladders of sales agents, who sell 'up the ladder' each adding their own markup of course. This creates tonnes of issues, your price is higher of course, but also, if something goes wrong, you're never going to get it fixed if there are six sales agents in the way.

Things go missing, and boats sink. They do not yet have the same regulations, check points and safety codes (and where they do exist, they are rarely enforced.) Boats sink.

Many of them will send you amazing quality samples but when it comes down to sending your final orders some places will ship you a mix of good quality items and a mix of items that are worthless, or close to it. I’m not saying everyone is like that, it’s around 50/50

Dealing with china or even Pakistan or other places these days is risky, so do as much homework as you can about the company you want to deal with.

I would like to say not all china suppliers are bad just like not all of them are good. Open your eyes,be cagey,then you can get what you want.

Hello,

I find your comments very interesting, although it makes me nervous about trying to work with chinese companies. I am actually thinking making some tshirts (i saw your other post about tshirts as well). do you have any advice on hwo i can go about finding a good company??? as i don't have really have the $$ to make visits ..

thank you...

[teabenny]

You can visit cheaply. My advice is sign up for an air courier company... they can send you pretty well anywhere in the world at short notice and you get a massive discount on your ticket - something like 75-80% off, can anyone confirm? The only condition is that you transport something to the destination for the company, usually valuable documents or somesuch. Once you've done that, though, you're free.

Now, if you can manage to get to Hong Kong that way, you're all good. Just go to the Chinese Visa Office on Hong Kong Island and pick yourself up an F-class (business) visa. It will take a couple of days to process and cost you somewhere around HK$600, but it will allow you 6 months in China with unlimited re-entries. Then you're set to cross the border into the city of Shenzhen.

From memory, China's textile industry is mainly located around the city of Hangzhou, which is just southwest of Shanghai. From Shenzhen, it's an overnight train ride, maybe 12-15 hours. Train tickets are dirt cheap, around US$35 for a sleeping berth. Shenzhen is a very busy city though, so tickets for a couple of days ahead are usually sold out.

Hopefully, you'll have already done a whole whack of prep before you land. I'm only telling you how to get there! Good luck.