"The China Sourcing Fair: Electronics & Components feature 2,525 booths, with 76% of them coming from mainland China. The majority of exhibitors at the show were from Shenzhen, accounting for 1,900 booths, followed by Hong Kong and Taiwan with over 500 booths. Exhibitors from South Korea, the U.S., Italy, Israel, Australia, Germany, the Philippines, Japan, Singapore and New Zealand are also taking part in the Fair. Despite the economic slowdown, booth number increased 3% as compared to last year," said Tommy Wong, Global Sources Exhibitions General Manager.

It's noteworthy that the global financial crisis has driven many buyers from emerging markets such as Russia, South America, India and Middle East to come to the show and source from China.

China suppliers looking to multi-channel marketing for more orders

Analysys International has recently conducted a research on more than 200 export companies. It found that, amid the global financial crisis, suppliers using the multiple-channel marketing strategies receive more inquiries that are successfully converted into orders. For single marketing channels, offline channels generate more successful inquiries.

B2B companies in China now provide four different marketing channels for suppliers, including online, print, private meetings and trade shows. As the financial crisis deepens, exporters have a harder time surviving and need to focus more on marketing strategies, knowing what the effective marketing channels are. The survey shows that while in booming times it's acceptable that suppliers receive a great amount of inquiries with only a small proportion converting into orders, in tough times the higher costs of handling these inquiries will affect their cash flow and put suppliers to a very difficult position. On the contrary, high quality inquiries can be more effectively converted into orders.

Global Sources' importer survey also revealed that buyers will be using a wider range of channels to seek their suppliers.

The surveyed importers indicated that the most effective ways for suppliers to win orders are to improve product quality (18%), provide better prices (18%) and accept smaller order sizes (14%)

Another survey from Global Sources also showed that China's suppliers remain optimistic about sales growth prospects in 2009, with 47% suppliers expecting sales growth of 10% or more in 2009. Among suppliers selling within China, 57% expect double digit sales growth, while 36% of export-focused companies project growth greater than 10%. Results are from senior executives of 191 companies engaged primarily in domestic sales and 202 companies focused mainly on exporting.

International importers' buying behaviors are changing

It was also revealed that more specialized exhibition pavilions and private meetings have become more popular among international buyers today. Buyers are communicating with their suppliers more frequently now as they need to make sure these suppliers are financial stable and can meet their changing requirements. In established markets such as the U.S., a small group of buyers control the vast majority of market share. In addition, importers' buying behaviors are going through changes. Global Sources' Executive Director, Sarah Benecke, said: "We are delighted to be opening our biggest-ever spring electronics show, despite the difficult market circumstances. We know that the market has changed and buying habits are different, but buyers are still buying. In many cases, they are looking for new 'value' products, innovative items to get shoppers back into the stores, smaller quantities and faster deliveries."

A survey conducted before last fall's China Sourcing Fair: Gifts and Home Products revealed that price increases and a decrease in consumer spending are the two biggest challenges facing buyers in the next 12 months. To address these issues, buyers are looking to consolidate existing suppliers; enter new markets; and look for more competitively-priced products. However, the research also revealed that 77 percent of the 300 buyers who responded plan to increase or keep their sourcing volume the same in the next 12 months, and will continue to source most of their gifts and home products from China.

"Close to 50% of surveyed buyers expect to maintain or increase their total import value in 2009," said Global Sources' COO, Craig Pepples. "We see a slight decrease in average price per item, and we know today's buyers require more flexibility in terms of order size. But China remains at the center of their sourcing plans, with 57% of surveyed buyers expecting to increase or maintain their total value of imports from China in 2009, as compared to 2008." Survey results also show that:

• 32% of buyers plan to increase total import volume in 2009;
• 18% will keep import volume flat; and
• 50% expect to decrease purchasing volume.

The survey also indicated that buyers are reviewing all their options and sourcing more cautiously to reduce risk.

The survey aims to understand importers' buying plans in the coming 12 months. Among surveyed buyers:

• 42% said they are making more inquiries to new and existing suppliers, as compared to 2008;
• 29% are making about the same number of inquiries;
• 29% are making fewer inquiries.

Pepples said: "With buyers looking at more options for each purchase, suppliers must work harder to win the order. They must submit more competitive bids and lower minimum order requirements. Moreover, as more cautious buyers use a wider range of channels to find products, suppliers also need to promote themselves across more of these channels to get buyers' attention."

"The 80/20 rule applies in many markets," said Pepples, citing a related study of the U.S. import market in 2008. "A small group of buyers control the vast majority of market share. This is good news for suppliers if they focus their promotion on influencing those critical buyers who control the market."