About China Supplier 1000 Project
  • China Supplier 1000 Project is a corporate research project focusing on strategic and operational risk issues faced by overseas buyers and Chinese suppliers. Founded by Dr Neale O’Connor, an Associate Professor in Accounting and a specialist on China.
  • Largest ever face to face interview study of Chinese Suppliers
  • Electronics industry focus
  • Exploring how Chinese suppliers win contracts and manage their large customers

Questions / Challenges?

  • What emphasis do Chinese Suppliers place on the use of different performance measures?
  • Do Chinese suppliers manage customers from different countries differently?
  • Do Chinese suppliers that have specific strategy for their largest customer have different performance measures?
  • With regard to risk assessment- How Chinese suppliers are managing the key challenges associated with rising material and labour

% of total sales to largest customer
The sales to the largest customers of most suppliers are less than 30% of their total sales. (n=612)

Most customers who explicitly share their performance measurement with suppliers do it annually. (n=597)

75% of large customers formally evaluate the performance of their suppliers. Often communications between customers and suppliers take place in the form of monitoring and are ignited by negative events such as delayed delivery and quality issues. As such, communications can become emotionally charged with little learning taking place.

The above pie graph shows the trust of suppliers to their customers is increasing, decreasing or same as before. It seems only a small part of suppliers think that their customers are less trustable compared with three years ago. (n=608)

Most buyers over promise and under purchase with an average order size of 75% of promised orders. Suppliers view such practice as a negative in the relationship. Buyers are you lying to your suppliers?
From the above graph, we can see that most suppliers believe the orders from their customers can well match their performance expectations. (n=612)

There are basically 12 categories of products provided by suppliers interviewed. PCB, passive components, connector, and generic components are four major categories. (n=604)

Suppliers with American customers have faster sales growth and highest profitability and suppliers with Chinese customers have the highest increase in market share. (n=595)

The sales growth and increase in market share is higher for those suppliers whose investment commitment to customers is higher. (n=612)

Suppliers whose customers sharing performance measurement have a higher sales growth and increase market share but lower profitability. (n=595)

Customers from other Asia have highest requirements on visits and quality. European customers have the highest requirements on delivery and financial standing. The requirements of customers from USA on production efficiency, service and technology are the highest. (n=608)

Compared with other customers, the importance of delivery by European customers is higher, while technology is more important for American customers, and cost is more important for Chinese customers. However, all of Chinese, European, American and other Asian customers regard quality as the most important criteria. (n=612)

The measurement of technology and cost is more accurate for suppliers whose customers are from USA. Suppliers whose major customer is Chinese company have more accurate measures of quality and delivery. (n=612)