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What continues to drag down China's foreign trade?
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TRACKING NO. 20260316 / GLOBAL Zhongshen Trade · 23+ Years of Expert Trade Agency
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or complex compliance issues.
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We have been exporting mechanical and electrical products for nearly ten years, but recently, we have clearly noticed that the profits from our orders are being completely eroded by various costs. The fluctuation of freight charges and the increasing demands from customers are becoming more and more obvious. I heard that Europe and the United States are conducting new compliance reviews. So what exactly is continuing to drag down China's competitiveness? How should small and medium-sized enterprises like ours respond to this situation?
Michael ZhangYears of service：6Customer Rating：5.0
Customs Declaration & Compliance ExpertStart a Chat
From a compliance perspective，the biggest drag at present isThe hidden compliance costs have surged dramaticallyThe EU's CBAM carbon tariffs，the U.S. UFLPA Xinjiang-related legislation，and other regulations essentially move supply chain reviews to the export stage. Many SMEs are only required to provide third-party traceability reports and carbon emission data when goods arrive at the port，leading to delays in customs clearance，fines，and even product returns. Customs authorities are now increasingly stringent in inspecting "under-declaration" and "non-declaration" cases，especially for the management of export licenses for sensitive technology products. We recommend you take two immediate actions: First，review the list of compliance regulations in export destinations over the past two years and establish supplier compliance files，Second，factor compliance costs into quotations from the bidding stage onward，rather than attempting remedial measures afterward. Compliance is not a cost—it's an entry ticket. Without it，you won't even gain a seat at the table.
Eric ZhouYears of service：6Customer Rating：5.0
Senior Manager of Foreign Exchange & Tax RebatesStart a Chat
The core drag on the logistics side isThe structural disruption of the global transportation networkThe Red Sea crisis has led to European routes bypassing the Cape of Good Hope, with the voyage duration increasing by 10-15 days and freight rates rising by 30-50% year-on-year. At the same time, the Panama Canal's drought-induced navigation restrictions have also affected East Coast routes. Many customers are still using FOB terms, but the risk of shipping companies raising prices and cargo space shortages falls entirely on you. It is recommended to adjust immediately: First, prioritize CIF terms for European orders to control freight forwarders and lock in long-term contract prices; Second, consider urgent ordersChina-Europe Express Train+ Truck combined transport, although the unit price is high, the delivery time is stable;
+ Thirdly, add a clause in the contract that "if the freight rate increases by more than 15% due to force majeure, both parties shall negotiate to share the cost", rather than bearing it alone. What matters now is not the price, but the resilience of the supply chain.
Victor SunYears of service：5Customer Rating：5.0
Trade Risk Control ManagerStart a Chat
The drag on the business level isThe imbalance of power in the buyer's marketEuropean and American customers take advantage of market uncertainties to shift all inventory pressure and exchange rate risks onto suppliers, extending payment periods from 30 days to 90 days or even 120 days, and frequently demanding price reductions. What's more troublesome is that they simultaneously reduce prices and require you to pass various factory inspections and certifications. The key to solving this problem is to
Changing the bargaining position: Firstly, stop simply being an OEM. Even if the investment is small, you should promote ODM solutions. Even if it's just a design patent, it can make it more costly for customers to switch suppliers. Secondly, regarding the delayed payment requests from old customers, you can say "we can extend the payment deadline, but we need to issue an invoice first".?L/C?First, set a clear price strategy and avoid over-discounting to protect profit margins. Second, use tools like "adding a 2% account period fee" to offset risks. Third, proactively explore markets in Southeast Asia, the Middle East, and Latin America, where customers are more price-sensitive but offer greater negotiation leeway. Remember, your confidence comes from having multiple options, not just a single order.