A survey conducted by Global Sources' Chief Executive China magazine earlier this month revealed that China's suppliers remain optimistic about sales growth prospects in 2009, with 47% of executives expecting sales growth of 10% or more in 2009.

Global Sources' COO, Craig Pepples, said: "With China's retail sales still strong, it's no surprise that companies focused on the domestic market remain optimistic. What's surprising is that, despite the global economic downturn, China's exporters are generally projecting much higher sales ahead."

Ways to cope with financial crisis

"This optimism is, in part, due to the fact that many companies have already adapted to the current global economic situation and have evolved new strategies to deal with the crisis.

Global Sources conducted a separate poll to gauge China enterprises' primary strategic responses to the current global economic crisis. It revealed that 43% of the respondents will build brands and/or increase efficiency and product quality; 21% indicated they will cut costs; 20% said they will focus on the domestic market and/or emerging markets; and, 16% indicated they will expand their online channels.

Potential of emerging markets

"Given China's increasing its cost base, cost cutting is less of an option than previously. To justify higher prices, suppliers are now looking to improve quality and production efficiency while, at the same time, building their brands."

Pepples pointed out: "For suppliers, a winning formula is to diversify their export markets, exploring opportunities in emerging markets. Other keys to success are to attract quality buyers, understand product trends from them and thus devise the right marketing strategy. This will give them a good chance to ride out difficult times. "

Domestic market a new focus

Dr Li Gang, a scholar with China Academy of Social Science, said: "China exporters must diversify. They should avoid over-dependence on a handful of markets like the U.S. and strengthen their ability to counter market risks. On the other hand, these exporters should take heed of the strong growth in domestic market demand. Our domestic market has been developing rapidly and now has strong spending power."

Dr. Li added: "China's exporters should seize the opportunity to upgrade their products for the domestic market, because on one hand the Chinese domestic market is demanding more and more differentiated products and, on the other hand, China's advantage of low labor cost is weakening. Our advantage of labor resources is changing, forcing manufacturers to shift to producing higher end products. If suppliers can make good use of labor strength and manufacture unique products that meet market needs, instead of focusing on low-end, low quality products, they will have a very good opportunity to win a share in the huge domestic market."

International buyers' new buying trends

"Global Sources connects quality buyers and verified suppliers through a wide range of media and marketing services. Our website is among the first indicators of new market consumption patterns, and thus can reveal to our suppliers how buyers' sourcing preferences and habits are changing. Recently, for instance, we know the buyers are looking for new products in smaller quantities," said Pepples: "In 2009, the key trend for international purchasing is that buyers will be more concerned about supplier stability, because only stable suppliers can meet buyers' changing product requirements. Global Sources also found that buyers sent more inquiries to suppliers through its website in the fourth quarter of 2008 than the same period a year earlier."

Global Sources has been one of the best performers in the industry despite the financial crisis and its influence on the export. Pepples said: "In this economic environment, we will continue to focus on providing our wide-ranging export market services. We'll connect the quality buyers and suppliers, and overcome the economic challenges with them. "