SOURCING OR HOW TO BUY IN CHINA?

Geographical, demographic, and macro-economic data on China:

 

– Population: 1.321 billion

– Geographical area: 9.6 million km²

– Density: 133 ppl/ km²
– GDP: 2.644 billion
– GDP/capita: 2,012 (USD)

– Active workforce: 758.3 million

– Currency: 1 Chinese yuan = 0.104 € (03/05/2011)
– Unemployment rate: 4.2%

 

Buying in bulk and at lower costs is every company’s goal, especially in today’s globalised environment. This is especially true for small and medium-sized enterprises, which have a much smaller margin of error than multinational firms.
Consequently, one immediately thinks of low-cost countries like China.

 

The question is how to do it?

 

Our solution: sourcing

Sourcing is an Anglo-Saxon term which describes the process of searching for, locating and evaluating an ad hoc supplier to fulfil a company’s requirement for goods or services. A specialist sourcing agent in China makes it possible to procure the best offers by analysing each parties’ needs. These international trade professionals can master the challenges of the Chinese market and are essential in most sourcing operations in China. You can trust these online specialists to handle your business operations as they will make sure the necessary steps are taken to ensure successful transactions.

Advantages: As they are based in China, these agents have expert knowledge of its very specific market and culture. They employ Chinese staff that have received ‘European’ training, allowing them to communicate with all companies without misunderstandings. This melting pot – of Western and Chinese culture – allows for complete understanding and tailoring to all markets: for both importers and exporters.

Disadvantages:  the assurance and benefits provided come at a cost: the commission taken by the sourcing company varies from 7 to 30% depending on the products and companies.

 

 Here are some figures on foreign companies in China and on French exports:

China is home to more than 260,000 wholly foreign-owned enterprises and Sino-foreign joint ventures  and receives more than USD 60 billion in additional foreign direct investment annually.
This means that 28% of China’s industrial production and 60% of its foreign trade is generated by foreign funded enterprises.

French exports to China accounted for €10.8 billion (including Honk Kong) in 2009, or 2.6% of France’s total exports.