• Building confidence around your supply chain – this is critical as your business depends on on-time delivery, quality, and reducing unexpected hick-ups in the process.
• Sharing data real-time, up to date, information to buyer and customers – if you can keep your customers and buyers informed with up-to-date information, the more confidence they’ll have in your operation.
• Get information before it’s too late – have a system in place that allows you to know when problems occur with your supply chain, before it’s too late.
• Providing data to all partners, departments – related departments need to be informed.
• Ensuring everyone’s on the same page  - if you can work with some type of system that allows you and your other partners to see the status of product specs, reports, and so on you’ll improve your business and reduce problems.
• Who are your partners?  (inside and outside of your organization)  Who do you purchase from, where are they?  Do you know who you’re working with and buying from?
• Are you forgetting someone when you are distributing information to your partners?
• Are you experiencing breakdown in communications somewhere in the process because your
• Partners/employees are not connected to the same system?
• What events and disruptions are no not aware of because of low visibility throughout your SC?
• Never assume you have all the information.  Check, re-check, and triple-check.
• Have a contingency plan in the event your shipment is delayed or problems with  raw material availability.

The cornerstone of any trade company business is a stable supply-chain.  For many years businesses have relied on a number of elements that have made China the sourcing destination it is today, but that seems to be changing more recently then in the past ten or more years.   Gone are the days of predictability and stability, which as a result highlights the need for businesses to be more diligent than ever when it comes to getting products manufactured in China.

On a recent trip to the mainland I found one major change in the business climate – the availability of skilled, reasonably priced labor.   Everywhere you go these days, factory managers have similar complaints.  There seems to be a lack of available labor.   What’s changed in the past 5 years or so?  Well, for starters workers have more choices because of the development of internal markets and demand for higher-skilled employees.  Workers are also demanding higher wages because of inflation that and changing social expectations.  Employees will jump quickly from job to job.  One manager told us nearly 40% of his workers took other jobs after the fall Chinese holiday.  Also, workers are being replaced by lower-skilled workers which translates into delays.

Fuel and raw material prices are also on the increase.  Companies are having to  prices this year because of increased costs in China.  Take for example Acer Computer, who hasn’t had an increase in 5 years, bit the bullet this year and upped their prices to keep up.  The development of internal markets is also fueling a demand for raw materials that hasn’t been seen before.  All of these elements cause prices to increase and lead-times to lengthen, two elements that make any importer’s stomach turn.

China is certainly full of opportunities, but with it’s opportunities come risks.

More information can be found at these links:

http://www.huffingtonpost.com/2010/07/19/chinas-cheap-labor-era-is_n_648234.html

http://www.nytimes.com/2010/06/21/world/asia/21chinalabor.html

Needless to say, that China’s growth has been amazing.  But, limits in some critical areas are nearing breaking points.  Pollution, transportation, labor and “Hollywood”, are just a few items on a growing list.  And, as the old saying goes it’s going to get worse before it gets better.

On a recent trip I had several scheduled meetings and a couple of chance meetings with people involved in different aspects of international trade.  All had concerns about their business, yet there were underlying similarities to their problems.  Something close to Einstein’s theory of a single equation solving all problems.  Well, we’re a long way from that; however there is hope. More