Living Entrepreneurship Blog / Babson Entrepreneurs

Business in China

Working with Chinese businesses isn’t the easiest thing to do, namely suppliers, especially when you are a foreign company. Even as Chinese persons ourselves (Fan and me), we have always had a hard time working with suppliers who basically hold no liability to us. For example, we’ve experienced some shady dealings with some suppliers, but were able to resolve them after quite a bit of stress and a lot of arguing.

In our early days, our suppliers were producing shirts later than they have told us they’d make the shirts. That wasn’t too bad because we budgeted shipping time such that late stitchings would still make it in time to the customers’ doors. But what was worse was when they were messing up the orders. Sending the wrongly configured shirt to a customer expecting a fully custom product is a massive failure for a business like ours.

Also, lately, the cost of doing business in China has risen, what with three big factors increasingly growing in cost:

i) the rise of the Chinese yuan versus the US dollar, so it’s not as affordable to buy from China anymore

ii) the rising cost of gas and oil such that shipping items halfway across the world is increasing our costs by double digit percentages

iii) the rising cost of cotton that’s putting stress on our suppliers’ who are then passing their added costs onto us (with a premium I’m sure)

Doing business in China is tricky. Hopefully we can sort out all of these issues so we can continue doing business as we are, otherwise we will have to find new solutions…

Anyone else have experiences with doing business in China or the Far East?

Danny Wong is a co-founder of clothing group BlankLabelGroup, which manages the brands Blank Label, Thread Tradition and RE:custom. Danny also blogs over at HuffingtonPost, TheNextWeb and ReadWriteWeb.