I believe that many foreign trade friends will come across it, and the customer looking for your quotation.You and the customer for several rounds of price negotiations, has quoted a very favorable price, but the customer is still not satisfied. Your price is too high, which is very common in foreign trade. Similarly, when we are developing customers, we tend to focus on the importers who specialize in such products. These importers place large orders each time, but the prices are kept so low that it is difficult for us to keep the customers.
In fact, we can look at the reasons for this phenomenon from the perspective of the supply chain.
From the perspective of importers doing pure trade, their purchasing staff will often travel between the two countries to run business between various suppliers. And basically many well-known importer customers in the industry come to the exhibition every year, and they are familiar with and understand many Chinese suppliers in the industry.
In fact, the purchasing staff of the importer will definitely lower the price with you. Why? Because behind their supply chain, there are wholesalers. Generally speaking, wholesalers will require a 30% discount, and will also lower prices with importers. Not only that, but behind the wholesaler, there is also the retail link.
Let's take a look at each link of the supply chain, such as from Chinese suppliers-pure trade importers-wholesalers-retailers. Of course, the middle wholesaler link may go through multiple wholesalers, for example,from large wholesalers to small wholesalers on a large scale; regionally, from district-level wholesalers to county-level wholesalers and so on. After layer by layer, every part must add its profit. When the retail link is finally reached, whether the retail price of this product can be sold depends on the retail price of the product; whether the business can make money depends on whether the retail price is still competitive.
In other words, if the import company is not in the process of importing products with you, they will obviously not be able to do the following business. When it comes to final retail, if the price is too high and the product is not easy to sell, the retailer will not be willing to sell the product of the importer gradually, and the sales of the goods of the import company will become a problem.
This is why you would think that the counterpart customers are always bargaining though the import volume is large, and this situation is normal. From your perspective, the price you quoted may be relatively low, but for the importer, he must squeeze out any possibility that you have reduced the price, and finally consider your real price.
This phenomenon of constant price reduction is easy to understand from the perspective of the supply chain. After all, behind their supply chain, each member of the supply chain must participate in all aspects of supply and distribution, and they must add their profits. In the end, if the purchase price is relatively high, it may be difficult for the importer to sell in the local market after purchasing this product.
Therefore, we must try our best to understand each other’s supply chain model and the various links behind the supply chain, so that when negotiating the price with customers, we can negotiate a suitable price that both parties are satisfied with, and promote order cooperation.