How to deal with a customer who goes direct to China for their flash drives.

How to deal with a customer who goes direct to China for their flash drives.

What do you do when you are competing with another distributor who is offering a price for Flash Drives that is direct from China?

Or better yet…what to do when a customer tells you..”I found them on-line for ½ the price…I am going to buy there!………I love these guys………..these are the ones who in the last century did buy the swampland in Florida…………..they also went to Tom Vu seminars in the 80’s as well……they are my all-time favorite people….

Here’s what happens….here’s what you do.

1) If it is a customer who is hell-bent on buying direct from China over the net……say this to them…….first…..”You are right…I can’t match that price…and then say NOTHING………I don’t care if you hold your breath until you turn blue…SAY nada, zilch, zip….NOTHING…….This should prompt the customer to speak first (remember the one who speaks first ALWAYS loses)……they will say something clever like….”Well…..you can see my reasons can’t you…? Or the ever popular reply…..”What would you do if you were in my shoes?”

2) This is where YOU speak up…….you say..” You are right…on the face of it all I would do as you are doing……….there are risks but I am sure you can work through them…”“Risks!” says the buyer….”what risks?”………this is where you look humble, never smile and speak in low soothing tones………”Well…..All I know (aw shucks) is that with most off-shore dealings you need to pay the Chinese vendor with a Letter of Credit or Credit Card or other prepayment options that is sent to a Hong Kong or Mainland China bank before they will process the order…….are you prepared to do that….?

Also remember that when you are at work, they are sleeping so communication will be difficult”…..buyer then says…”A-ha…But they have an American office!”…..you say…”So then the American office will translate and transfer your message to them while they sleep…? How's that going work for you..?”

3) Then you must be honest and say….”listen I don’t really care if you go there..if you get a better price, with no grief or risk…I WOULD do the same!……..however the way Flash Drive factories work is this .

a) There is a charge for the memory drive (also is it tier 1 or is it recycled memory…for a better explanation on what memory is go to…..

b) There is usually a separate charge for the housing.

c) Is there is a screen set up charge?

d) Do you pay for the broker or do they?

e) Is the price landed at your door or ex-factory? (Big difference..trust me)

f) Do they have a return policy if there is failure?

g) What is the warranty? Is there a warranty……..?Now if the customer at this point wants to go to China ..let them……..to quote a Great American….”stupid is as stupid does”…Gump.And walk away……….they will either........

a) Call you back after they have “reconsidered their position”.

b) Keep on going and deal with all of the crap.

Either way…you will have informed them (honestly…..)..you did not show them panic…(remember if someone sees you panicking because you may lose a sale as they will think they are on the right track……if you seem non-plused by the whole thing they will sweat…….if you are calm, they will be freaked at the best and nervous at the least…..this is where you want them………..

Why am I writing about this?

I bring this topic up to you this morning as I just had a situation that hi-lites what I am talking about. We deal with a factory in China and we have problems with communication….I am going to explain the situation and give you the verbatim emails I woke up to this morning.

Here’s the scenario:There is 200 drives that HAVE to be in Dubai Monday.The factory deals with us everyday and has our credit card and courier accounts on file.The customer and distributor are “having kittens” as this shipment is close to the bone.

The customer supplied their DHL account number (which unfortunately was a number or letter wrong.)Laura Wu is the customer service person at this factory. She is EMAILING me at 2-3 in the a.m Saturday morning……..she also has my home phone number….she knows this is an urgent order.

Email 1) 2:18 a.m. HI John,I see this order is extrodinary urgent,so I arranges to ship it out by DHL prepaid for the Dubai shipment 200pcs USB,also bought insurance prepaid.We will caculate the real shipping cost and will ask you for the extra cost over USD 124(shipping cost you have paid for this order).Is it OK?The tracking no.is DHL# 192-8224-012 for the 200pcs USB to Dubai shipment,attached invoice pls find.For the left 50pcs to Canada,tracking no. is Fedex# 9511-2x59-xxx5.B.regards,Laura.......(We are of course ….sleeping when we get this email...)

Email 2 ) 2:42 a.m. John,Just now,the shipping department told me the 3rd party DHL account #FQ5302 is WRONG,the DHL account should be 9xxxxxxxx,pls kinldy inform me the right DHL account asap as you know we are hurry to ship it out this afternoon.B.regards,Laura

Email 3) 2:44 a.m.John,I called you but could only leave message (I am still sleeping) .The DHL account is wrong,how can I ship it out now???

Email 4) 2:50 a.m.John,If we can't receive the correct account in 45 minutes,the courier will be off and can't pick it up.Then we could only ship it out next Monday.Laura

Now…….you might think they would do something like USE THEIR FRIKIN HEAD…but no…..They should have or could have 1) Used our courier2) Charge it to our account or credit card3) Put it on their account and charge us back…..(We do more than a few 100k with this company each year……you’d like to think they took that into account?)

But Nooooo!……they stare at the box and are mystified into absolute stupor…the proverbial “Deer in the headlights”……..So now what happens?

1) We either eat the order or cut a deal for our distributor…why?… because that’s the right thing to do……..

2) The distributor…..we probably lose their business……

3) The distributor may lose his customer……..Now let me ask you this….?If we as a major supplier have this happen (fortunately it is not often) and we deal with the Chinese factories EVERYDAY… ……how do think the end-user will do with them going direct for their 100 or 1000 piece order……?

Feel free to pass this along……..Happy Trails

John Graham