Tomorrow I am going to visit an electronics importer here in the Bay Area. This is a small company but they are experiencing tremendous growth and want to ramp up their operations, which of course includes their China operations. I was talking to the CEO on the phone the other day and he told me he was very happy with his main supplier now. I asked him how long he has been doing business with the supplier and he replied three years. My first thought was that three years is not really a long time and that this company still needs to be careful and treat this vendor as a new vendor. This means they have to do their part and get the vendor orders on time, clearly indicate product and testing requirements, avoid last minute product design changes and, of course, they have to inspect orders before they leave China. And they have to develop alternate suppliers in the event that problems arise with their current supplier, as far off as that scenario might seem right now. In fact, this is one of the Golden Rules of China sourcing, never feel complacent with a situation, no matter how long-standing the relationship with your vendor is and how well things seem to be going. Because something can always happen when you let your guard down.
A good parallel is this past weekend’s football game between Michigan and MSU. With ten seconds to go in the game and possession of the ball all Michigan had to do was punt the ball away and they would win the game. What happened ? The punter fumbled the snap, tried to kick the ball anyway ( when he should have just fallen on it) and it was returned by MSU for a game winning TD. In the post game discussions and write-ups all of the blame was directed at the punter, yet I think much of the blame should go to the coaching staff for not telling the punter what he should do if there was a bad snap or fumble. That is what coaches are there for, isn’t it ? Yet the Michigan coaching staff just assumed the punter would kick the ball away and apparently did not discuss the contingency of a bad snap or fumble. The lesson to be learned is this: When the game is on the line don’t take anything for granted. When you are a small business and are sourcing in China, and are succeeding at it, don’t feel you have won. You are winning but you have to be vigilant with every order and until the end.