Dear members,

Nowadays a very serious problem faced by buyers and importers is changing in prices in China. But our local customers are not agree to pay more that items.

The main reason is that suppliers charging more profit as compared with the reason of them for changing in exchange rate, rabet policy in china etc.

Even suppliers exoprting us from more than 3 or 4 years, same problem as buyer facing with them.

How a buyer can check and varify that changes in prices are reasonable or not?

Replying to [Usman0]:
There are a lot of increase in the prices for raw materials, food , petroleum, transportations and so on. Therefore
suppliers from China, no matter from big to small ones, have no choice but raise their prices.
The RMB yuen is developing into
stronger level and there are expectations for the UD Dollars will be dropping into the exhange rate for US$1 =RMB 7 with 6 to 8 months, if situations do not change.
The US government has adopted a weakening dollar policy enhancing
the Chinese yuen RMB to go higher and trying to balance the trade deficits between China and the States.
I am very sure those members will import goods from China and pay more prices. Unless you are using strong currency, then you may buy cheaper or the more less the same.
The weakening US dollars will give impact on all of us. whatever you are
sellers or buyers.
Let' see how is 2008!
warm regards

Replying to [Usman0]: I think it is hard to check the price. Maybe you can ask supplier to use more stable currency, like the EURO. My supplier did this, and now it is cheaper than the USD.
It is sometimes better to use different currency, maybe even use Chinese RMB

Replying to [Usman0]:really it is a very big problem for chinese people, if let's go to international trade, it is sure bad for foreigne traders. but i think foreign friends should understand our situation too. even chinese people can not accept the higher price of everything, some food like milk and cooking oil, the price now is double than before, how can we accept so big change? i am mining machinery company, the price of big machine havent change for years, but now the price of steel is very high, and the currency of US$ is so low, the machine price seems higher than before. but who knows that we sometimes even have to lose money rather than earning money. now new year has come, i hope the situation will be changed as soon as possible!

Replying to [Usman0]:
Our company is a buyer from china like yourself. I do not agree with your assumption that chinese suppliers are increasing the price just to increase their profit. Products from china are increasing because of several reasons:

1) The Chinese yuan has been appreciating against the US Dollar and will continue to do so for the next few months/years. The chinese govt is actually already keeping their currency on a controlled leash lettng it appreciate by a "mere" 8-10% per year. Fortunately for most countries, their currencies are also getting stronger against the US dollar so this somehow offsets the "cost" of the yuan gaining strength. Unfortunately, Pakistan's currency is not among the currencies gaining strength.

2) All costs pertaining to the production of products specifically raw materials and labor are increasing. If you are buying china goods made from metal/brass/copper/wood/plastics/lead/rubber, you should be aware that these commodities are traded worldwide and that these commodities have been increasing at a very rapid phase . You can check data from some of these materials on the london metal exchange. If you feel that the increases in the price of oil is crazy, you should check the historical prices of some of these commodities. The cost of these materials have doubled or even tripled in just a few months.

3) Labor costs in China especially in highly urbanized areas like Shanghai are going up.

Having said all of the above and to answer your question, it would be best to have different suppliers in order for you to gauge the real price of a product in China. For example if you are buying screw drivers from China, maintain a list of 3 or 4 suppliers so you can check with all of them the current market price of a particular item before you order them.

Replying to [Usman0]:Personally speaking, business is harder than before since the cost of the products is increasing.We are the fastener manufacture and the raw material such as the carbon steel and the stainless steel is much expensive is before and the price change a lot.We have to told our customer the vality of the quotation, some customer can't accept it and we lost some clients for this reason.

Replying to [Usman0]:
Your suppliers are just telling the truth.
We are a Chinese supplier, too.
The RMB unit prices of our products haven't been changed and maybe it will be highered in the near future because the prices of the materials are much more expensive than before.
But the USD unit prices have been changed for two times since I went to this company. At first, we use an exchange rate of 8.4 : 1, then because the export rebate rate in the july, we use 7.8:1; Now, because 1 USD only worths less than 7.4RMB, we've change the exchange rate into 7.5:1.
Frankly, we don't like change it either (it will make us more difficult to get orders), but we have to !
Our prices are already quite low because of the keen competition, and if we don't change the exchange rate, we will even loose money.

Replying to [Usman0]:

Thanks for your kind replies. and understanding, We are importers and every customer demands for lower price than last time, there is no way that customer agree to pay more, We have to change our models to set a new price,
But this is effect our business much,
and now many importer want to do business with some other countries like India, and ali baba also opening there its offices, which is the trend of trade and whole world.

How can we control these prices??? is it uncontrolable then what strategy will adopt to maintain good business level?

Replying to [Usman0]:

China got price rocketing the past months,and if you were not sure, you may ask more suppliers in China and you will finally find out if they are cheat you or not