Concentrated Distribution
By Ron Cune
Just like in other countries, being dependent on one relation is also not advisable in China. Whether it concerns a client or supplier, a distorted relationship will often cause pressure. This will result in a weak negotiation position which, in some situations, will cost you dearly.
Satisfaction with the current situation should not be an excuse to ignore other purchasing channels.
Allowing assignments to circulate within a piggy bank of suppliers with the same abilities will provide greater flexibility to anticipate economic and regional developments.
Aside from being better equipped to handle rush orders, the piggy bank will provide something to fall back on when a purchasing channel is lost.
Of course, the real art is finding the right way to hint that you are not dependent on one particular party.
Ron Cune, Dragondancers
1 Comment » 1 Answer » 
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December 11th, 2008 at 1:14 pm
This advise is feasible if your purchase volumes are large enough that you can afford to spread orders around and still occupy substantial production capacity at each supplier you work with. If you’re not in a position to control a substantial amount of production capacity at one supplier, then you don’t have the luxury of being able to work with multiple suppliers.
Dangling the prospect of big orders never affords you the same leverage as coming to the supplier with the order and down payment in hand.