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16 FOCUS PSI Journal 5/2016 were reduced by more than 100 billion dollars per month. There is no crisis management, not even on the part of the state. We need only think back to the suspension of stock exchange trading after the recent sharp fall in stock prices. CUSTOMISED PRODUCTION IS BECOMING MORE DIFFICULT As a consequence, problems which did not previously exist have arisen in the cooperation with China. In our view, the risk of shortages even after making an advance payment or during production has risen immensely. Customised production is becoming increasingly difficult due to problems within the Chinese companies. This can manifest itself in sudden price increases. The manufacturer may possibly receive no more money from the banks or wages have increased. Our problem is that the distributor cannot pass on such price increases to his customers as pricing is fixed on completion of the order. In China you cannot claim damages; the principal is thus susceptible to blackmail. Some manufacturers no longer receive any money from their bank on LCs and therefore do not want to accept any. STRONG FLUCTUATIONS ARE EXPECTED I believe that at some point we will switch to paying with RMB, which will then be massively devalued to indirectly reduce the labour costs. Then, of course, imports would again be much more expensive. In my view, there will continue to be strong fluctuations that some companies will not survive – in fact more than one can imagine. »In my view, there have been no significant changes.« SASCHA THIELEN, TLN At the moment, we are not experiencing any major changes that affect us. It was to be expected that growth would decline slightly and, in my opinion, that is not a problem. LIQUIDITY IS AN ISSUE WITH SUPPLIERS A certain market adjustment is taking place in China at present; small suppliers and those with poor service are experiencing difficulties. This does not affect our business as we have been working together with our partners for more than 10 years. We have noticed, however, that some suppliers are relieved when payments are made quickly. I think liquidity is an issue with some producers at the moment. However, we are also little affected here because we do not usually pay the largest invoice amount until we have received the goods. Overall, the cooperation with our regular partners runs very smoothly. AN OPEN AND FAIR COOPERATION IS IMPORTANT From my point of view, it is important for us to be in constant contact with our Chinese partners to exchange information about the market situation on a regular basis. An open and fair cooperation is the best approach to ensure that the challenges that confront us from time to time can generally be overcome. »We have been establishing a quality production outside of mainland China for several years.« RALF OSTER, PF CONCEPT INTERNATIONAL B.V. PF Concept has close and longstanding business relations with China. In our view, however, there have been significant changes to the economic conditions in the past few years: The personnel costs have increased significantly and, as a result, manufacturing has shifted to the northeast of the country where a moderate wage situation still prevails. Nevertheless, we have noticed an increase in the risk of strike. POSITIVE DEVELOPMENTS On the positive side, there has been a significant improvement in the compliance responsibility situation and overall product quality. In addition, the production itself has become more flexible and price negotiations are possible at shorter intervals. This in turn has led to an increased competitiveness of our products on the European market. QUALITY CONSULTING INSTEAD OF QUALITY CONTROL Compliance, corporate social responsibility and quality are important criteria for us when selecting our business partners in China. As one of the

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