Once you work with a China supplier, it involves bargaining. The process of bargaining is a game. The two sides are deadlocked for their own interests, which seriously affects work efficiency and even damages own interests. This is a big headache.
In the previous part, we talked about how to purchase cheap products from China. What’s more, we introduced the importance of choosing a platform. You can choose the wholesale market, direct factories or China agents. But when you work with China suppliers, it’s important that you take the initiative and get a better price. Today we will provide you with a template for your bargaining tip, here are 8 rules to get your ideal wholesale price.
Tip 1. A comprehensive understanding of the procurement of products, processes and raw materials
The first bargaining tip is to start from yourself and know well about the products you import from China. You need to know the products’ technology and raw material. You will know what material the product is made of and how it is made. The advantage of this process is that:
Less likely to be cheated: As the China suppliers in order to sell you a high price, will boost their products how strong technology and what good materials, a lot of foreign customers do not understand it is easy to be cheated, but if you understand, there will be no such problem.
Professional in your products: You will have a clear understanding of your product, but not keep asking questions. It’s very helpful for your after-sales service. When a customer has a question, you can immediately help solve it.
Tip 2. Calculating the price-cost by yourself
After knowing the process and materials of the product, you need to calculate the price by yourself, that is, the cost price of your importing from China.
By knowing the cost price, you can know exactly where their reserve price is when you negotiate with the supplier without being cheated by the China supplier. How to calculate cost price, these are you must consider:
- The cost of materials
- Labor cost
- Factory management fee
- All shipping costs(both domestic and foreign)
Tip 3. Researching multifaceted market
Multifaceted market research will let you clearly understand the China market and industry information. You will become a professional buyer, know where to buy, know where the quality will be better.
So where to get the information, we suggest you can from these 3 aspects.
1) From your friend
When you visit the China market or research a product, the first consideration and the safest way to do so should come from your friends. You can ask:
Your foreign friends who imported from China: You can ask your friends who are purchasing in China about their understanding of the China market and the products you want to purchase. They can give you some suggestions.
Your China suppliers already cooperated: Secondly, in addition to your foreign friends, if you have a stable supplier in China, you can also ask them for information about other products. As a factory growing in China, they are very clear and willing to help you
In addition, to getting information from friends, the second, the most convenient way is to search online. You can look at more wholesale websites in China, (like 1688.com, alibaba.com & aliexpress.com) and constantly search the price of your product. you can get:
Know the approximate profit: You can make a statistical table and analyze it to find out how much they sell. Combined with the costs you have calculated, you can roughly know the profit.
The hot sale products: In addition, many search the website, which products are hot, so that you in the purchase, a great help.
In addition to the two methods mentioned above, the only way to directly contact suppliers and investigate the market on the spot is through the exhibition. The only disadvantage of attending the exhibition is that it costs a lot of money. Secondly, it needs to make a reservation before and make a good strategy.
The most famous exhibition in China is for you to choose:
Address: No. 382, Yuejiang Middle Road, Haizhu District, Guangzhou
Period: 15th, Oct-4th, Nov. 2018
Address: Yiwu International Expo Center
Period: 21st – 25th, Oct. 2018
APLF Leather & Materials+
Intel Fair for Innovations in Leather and Fashion Materials
Mar – 15.Mar 2019, Hongkong, China
Tip 4. Sending inquiry mail widely
After you research the China market, understand the product and accounting costs, the next thing you need to do is to send inquiries.
You can make inquiries through wholesale websites like Alibaba. But the inquiries cannot be sent casually. “An inquiry that has certain skill must produce a different effect”. Please care below point:
1）Using corporate email.
You should use corporate email not hot mail or Gmail. Please don’t let others think you are a small customer or a liar.
2）Keep the length of the message, not too long or too short
Too long email, people will not necessarily have the patience to read, too short email, people think you are not a valuable customer.
3) Centralize the order quantity and place order together
Please centralize the order quantity. A good order quantity will get different treatment from suppliers. Please don’t place 100pcs to supplier A, place 100pcs to supplier B, and 100pcs to supplier C.
4) Indicate your purchasing plan
Please specify your purchase plan in the email, you will get different treatment from the supplier
Tip 5. Comparing the prices of different suppliers
Next, you need to continuously analyze the supplier price list you receive, you need to find the top5 suppliers and do a background check.
In addition, you also need to analyze the high, medium and poor quality customers, choose three suitable suppliers.
Tip 6. Give out the price lower than your target one firstly
When you get the right supplier, you can contact them and give your target price.
Of course, this target price is definitely lower than your expected price, because a lower price means a higher profit for you. Similarly, suppliers will give their prices. Be sure to ask these in-person questions before they give you a price:
1) What’re your details of packing requirements?
Please give the packing requirement according to your requirement. Of course,
plastic bags packing cost < gift box packing cost.
2) If you have logo customization requirements?
There are two kinds of logos, the embossing logo, and the metal logo. Of course,
embossing logo cost < metal logo cost.
All these costs will be calculated in China suppliers’ price.
Tip 7. Increase your quoted price to close China suppliers’
The skill of bargaining is very important, It must not be done at once, but over several rounds.
Round1: The first time, you give the China supplier a price below your target price. For example, according to your cost accounting of medium quality, the product cost is 5usd(not any profit), General China suppliers will add their own profit if it is 30%, they quote for 6.5usd.and your target price is 5.5usd at most, so you can quote China supplier 5.2usd.
In the China market, the worst quality may be usd4.5, but because you have studied the quality and the market and know it very well, you will not accept this quality.
Round2: China suppliers not accept usd5.2, and said the products cost is usd6, they have no profit, now you should assist your target price usd5.2, and told them your purchasing plan, the order quantity is 20,000 per month.
Round3: China suppliers give you the price usd6, want for the long-term business relationship.
You should not accept and ask their price reduction plan.
Round4: They can help you find a very similar replacement fabric, which is cheap and of good quality, but with slightly different texture advantages, but not obvious. And give you price usd5.8. Now you should not accept and tell them your second order will be placed to them next week.
Round5: China supplier will give you last final price usd5.6 and told you they can not lower price anymore. For now, may you can accept. You already save around usd1.0
So a good negotiation must be based on your clear understanding of the market and product control, has good negotiation skills. We are professional in this field. RunSourcing, 10 years of B2B purchasing experience.
Tip 8. Looking for stable suppliers
After dealing with Chinese suppliers for many times, you will accumulate some good suppliers. Please establish some stable suppliers, and you will get a very good wholesale price.
We can help you maintain supplier relations. Please, you can pay attention to our customized service.
Hope these bargaining templates can help you. But there are many flexible ways to bargain with China suppliers according to the circumstances. Are you having the trouble of bargaining? If this problem has not been solved, please contact us as soon as possible. We are a professional sourcing agent in China.
Solve the problem a day earlier, and you’ll be ahead of your competition.