I know what? Many Western buyers I have seen assume that the key things to focus on in injection molding negotiations with China are price and speed of delivery. On the contrary, they are completely mistaken.

Seeing deals fail and friendships break because of little misunderstandings made me realize that successful sourcing from China means understanding a different way of doing business.

This Negotiation is Different from What Typically Works

To put it straight, the tough, quick-moving dealmaking style often seen in New York or London? Doing this in Shenzhen or Dongguan will result in a major failure.

Chinese business culture is based on different core ideas. Western businesspeople usually concentrate on fast deals and written contracts, while Chinese suppliers prefer forming long-lasting relationships and showing respect. It is simply different and that’s all.

I saw a German buyer fail to keep a great supplier relationship because he always requested immediate price reductions before gaining the supplier’s trust. Producing exacting automotive parts was something the supplier was great at, but the buyer always treated their relationship as if it were a hostile takeover.

Guanxi is More than Handing Out Business Cards

A Chinese businessman might tell you that your guanxi (relationship) with your supplier is more important than your contract.

It goes beyond networking; guanxi is an important, two-way relationship based on trust, mutual help and personal ties. Consider it to be money you put into your relationships as time goes by. When you have a lot, you’ll get great prices, your production will be faster and your supplier will be more likely to help when something goes wrong.

Guanxi is built slowly with time and effort. Avoid trying to speed up the process by spending a lot on meals or presents (even though they can be nice). You need to treat your supplier as someone you work with and not just as a vendor.

Some buyers spend time getting to know the suppliers’ families, pay attention to Chinese holidays and are interested in their business problems. Having these relationships is very useful if there are changes in the market or during the busiest times.

Communication: Interpreting What is Not Said

Chinese people communicate in a way that is very fine-tuned and this can be very frustrating for Western buyers who aren’t aware.

In China, saying “maybe” or “we’ll consider it” usually means that the supplier is not interested. They’re not direct about it to help you avoid being embarrassed. Being direct about your opposition or just saying no to someone is seen as impolite and can damage the relationship.

Notice when you see phrases such as:

• “It might not be possible” (Translation: Still, we can find another way to do it)
• “Let’s discuss what we can do about it among ourselves” (Showing that what’s happening isn’t working for the team)
• “That’s an interesting thought to consider” (Translation: We don’t think that’s the case)

When they are motivated, you might hear them respond with “we can collaborate on this” or “this can be done with a few changes.”

Being patient and noticing the underlying meaning is the main thing. Don’t urge your clients to give an instant answer. Allow each person time to think and suggest options that let both sides achieve a solution that benefits both of them.

Timing Plays a Big Role: Running a Marathon vs. a Sprint

Many Western businesses need fast results and usually want decisions made quickly. Good Chinese suppliers like to know your requirements in detail before deciding to work with you.

This isn’t a sign of inefficiency; it means the process is being done thoroughly. They strive to provide what they claim, so they avoid overpromising and not meeting the expectations later.

Talking about a new injection molding project usually requires several rounds of discussion. They will want to know what you need, talk about any possible challenges and may propose some changes to improve how the product is made or reduce costs.

It doesn’t have to mean they are not interested or that they are playing for time. It means they are concerned about making the project successful. Pushing them into decisions too quickly can result in problems later.

The Face-Saving Dance

The Face-Saving Dance is a process by which people try to avoid losing face.

In Chinese culture, “face” (mianzi) is very important and failing to understand it could ruin your negotiations.

Face consists of dignity, reputation and social status. If you criticize a supplier’s quote or raise concerns with their proposal in front of everyone, you could make them lose respect which might harm your relationship.

Deal with sensitive matters by talking to the person involved quietly. For problem-solving or price negotiations, always do it either with the single person you’re dealing with or through an intermediary. See criticisms as opportunities to solve problems together instead of looking for faults.

An example would be saying, “How can we make this fit within our budget?” instead of “Your price is too much.” The first method causes rivalry; the second encourages people to work together.

Taking Action: Effective Ways to Manage Meetings

I want to cover how these negotiations are carried out in practice.

Carry a lot of business cards with you. Receive each card with your two hands and spend a moment to look at it. It lets the customer know that their needs are important.

Start each meeting by talking about relationships. Enquire about their production line, most recent improvements or current trends in the industry. Using this time builds a good relationship that will help you during your negotiations.

Bring detailed drawings, samples and specifications when you are explaining what you need for your injection molded parts. Chinese suppliers value when buyers are attentive to the little things. Unclear requirements often result in people not understanding what they will get and being disappointed.

Make sure you are ready for group chats. There are often several members of a Chinese supplier’s team taking part in negotiations such as engineers, sales managers and sometimes the factory owners. People have different roles and seeing how the hierarchy works can help you talk to them better.

Negotiating prices needs a careful approach. Chinese suppliers are used to negotiation and manage it with a plan in mind.

Try to grasp their point of view first. Ask the business for examples of what affects their pricing or “Which areas of the business have the most cost challenges?” This tells you about the challenges they have and helps you spot possible ways to reduce costs.

Volume commitments may allow you to get better prices. Talk about your ability to place big or long-term orders right at the beginning of the discussion. It proves that the company is serious which encourages suppliers to offer more competitive rates.

Factor in the life cycle cost of the product, not just its initial price. Even if a supplier is more expensive, better quality, faster delivery or better technical support usually result in a better value over the long run.

Give reasons for lower prices by referring to what is happening in the market. Ask for competitive quotes (not naming the suppliers) or describe how your budget is limited. It allows them to get your point of view without making it confrontational.

Having a Technical Discussion: Using the Same Language

Because injection molding is highly technical, good communication helps prevent expensive errors.

Many Chinese suppliers have a lot of knowledge about manufacturing and may be able to recommend changes that cut costs or improve the end product. Pay attention to their advice since they may have dealt with the same problem in the past.

Talk through the specific details of the materials to be used. Various suppliers might be able to use different grades of materials. Set your requirements clearly, but be open if something else can perform as well.

Discussing the level of quality is important before starting the project. What standards should be used for deciding how much tolerance is acceptable? Which inspection processes must you use? What measures will be used to manage products with defects? Be sure to handle these at the start, instead of just hoping everything will go well.

When to Celebrate and Cultural Traditions

Chinese New Year means factories close for several weeks. Golden Week in October disrupts travel and work schedules greatly. Strategize your production so you are not working during major holidays and remember that regular communications might not be possible then.

Being aware of these cultural habits lets you respect others and not have unrealistic expectations. Buyers who consider the cultural events of their suppliers are appreciated by those suppliers.

Ensuring the Company Succeeds in the Long Run

No matter how good, a relationship with a Chinese injection molding supplier takes years to build.

Good buyers spend time learning about the businesses of their suppliers. They go to factories, meet important staff and build personal relationships with those who make decisions. The investment is worth it because you get lower prices, priority assistance when things get busy and teamwork to solve problems.

Talking to each other often supports these friendships. Still visit the website from time to time, even without ongoing projects. Give your suppliers information about market changes or new trends. It helps you become a partner, not only a customer, in the relationship.

Think about implementing supplier development programs. Assist them in becoming more capable by offering training, buying new tools or improving the way things are done. Because of this, people become more connected and their relationship grows stronger.

If Something Goes Wrong: Putting Out Fires

Problems can still happen despite all the best efforts. Your methods in dealing with conflicts can build up your relationship or harm it.

Tackle the issues as a team and try to find solutions, not look for someone to blame. Chinese companies are more open to teamwork than to confrontation when facing problems.

Look for ways to give people a way to save face if you can. Should a mistake happen, help the supplier fix it and get back on good terms. Doing this shows the other person that you are dedicated to the relationship.

Signs to be Wary of

Different suppliers have different strengths and some things should be noticed.

Watch out for any supplier who agrees with you right away without asking for more details. If suppliers think a requirement is not workable, they will suggest alternatives and improvements.

Be aware of how the family communicates with each other. Good suppliers answer quickly and think deeply about what is needed. Inadequate communication usually points to bigger issues within the workflow.

Go to factories whenever it is possible. Actual observation is the best way to judge their strengths, quality systems and how professional they are.

All in All

Finding success when negotiating with Chinese injection molding suppliers takes patience, respect for Chinese culture and real effort to build a good relationship. Making business changes is more important than learning a few Mandarin words or bringing pricey gifts.

Gaining a good understanding of Chinese business culture gives you better business partners, better prices and reliable suppliers who add value to your company. Because the global supply chain is so complicated today, it is often these relationships that decide if a business succeeds or fails.

Work on forming real relationships with your suppliers. Respect the skills and knowledge of the other negotiators, understand what holds them back and negotiate as a team rather than fight against them. Having a budget will help your finances and lower your stress.