Quantity discount is an important concept when purchasing products from China. This guide breaks down the quantity discount, why suppliers have quantity discounts and how to calculate quantity discount for the most cost-effective way to purchaseproducts.
Have you ever had a bad experience with a business? A poor meal or customer service that really made you angry and never want to return?
This can happen with sourcing products from China. The difference is you will not know any products were bad or poor quality until well after the order placed, paid and shipped to you. Returning the products will cost you and your business dearly.
Have you ever read certain ads and seen a wall of text at the bottom of the ad in very fine print? This print covers the legal information and costs that are not explicitly mentioned in the main ad. This is done on purpose. By law, it must be there. If people took the time to read it, they may not buy those products.
Business-to-business, B2B for short, is the selling of products between two businesses, typically a manufacturer to a wholesaler or a retailer. One good way to think of B2B transactions is when a manufacturer purchases for raw materials for their specific products – like soy wax for candles or steel for kitchen knives.
When taking a complete look at the cost of products sourced from China, the purchase price is often the most important part and concern of the buyer. Any buyer will do price comparision across manufacturers – common practice for any product buying – along with inquiries and negotiation as the basis for all product sourcing and procurement.
Most buyers or purchasers who are working with Chinese manufacturers do not recognize that the supplier relationship is more than a single element and is, in fact, a systematic discipline. This means within a particular business operation all of the relationships within the operation are equal and deserve the same amount of attention. This means the supplier relationship management is no less important than the customer relationship management, dealer relationship management or public relationship management.
Each company has the same fundamental question – what is our core strategy? This question is most often based on the personal values of the founders and should be based on its value proposition and corporate vision.
The initial need of any company are the same – survive. It is making it past this first initial step that is so difficult for most businesses. It is common for businesses to take a significant loss for the first year to a few years, and provided the business survives this crucial period, the next steps, the future development of the company, can be taken into consideration.
As a small business looking for high-quality Chinese products, you immediately consider the main characteristic of a good manufacturer is their output capability. Most people who are looking to source products independently and without in-country assistance will consider this and nothing else when looking into particular manufacturers. There is an inherent bias in using this as the single metric of evaluation, but it can be satisfactory in determining the manufacturing capacity within the supply chain. It is important to realize the manufacturing capacity is only one of six indicators Sourcing Nova and its purchasing agents use for making a decision on a particular manufacturer of your selected products.
There is no doubt that if you want a business to survive that you must be constantly reflecting, revisiting and redefining your product base. Following the feedback of your customers and your competition, you can make the necessary adjustments to keep your business viable and profitable.
The number one most important thing to consider when sourcing products from China is quality. If there are issues with quality from the outset, the potential of the business surviving and reaching profitability is exceptionally slim.
Quality starts with the product stability as the products come from the manufacturer. Quality determination starts with supplier quality management.