Sourcing from China
When sourcing from China, there is much work to do and many factors to consider about. Here are five pointers to help you get started:
1. Invest Time in Locating the Best Source
Many people who source from China use Google, Bing, or Yahoo as their primary search engine. Internet sourcing platforms like Alibaba, Global Sources, as well as Made in China, which link customers with Chinese suppliers can be utilized as well. While all of these tools are valuable for creating a shortlist, keep in mind that many of the services siuggested by search engines, including sourcing platforms, might well be resellers rather than manufacturers. While sourcing from any middlemen may be acceptable when purchasing products for retail such as toys, clothing, or low-cost electronics, it is best to identify a vendor and source directly from them when you require products that should fulfill specific technical demands such as diecasts, metal stamping, as well as plastic injection molding. Most significantly, this saves money.
Online sourcing platforms like Alibaba and Global Sources rank their suppliers, which may aid in the shortlisting process. Alibaba, for example, assigns “gold” ratings to its suppliers, which buyers see as an indication of reliability. However, it is crucial to note that any provider that pays Alibaba a yearly fee for premium membership may achieve gold supplier status, which boosts the vendor’s exposure on the site. As a result, that is not an exceptionally reliable dependability indicator.
2. Check Suppliers
Once you’ve narrowed down your selection of providers, you’ll need to double-check their credentials. While some clear information is accessible on the internet, you must evaluate:
- Whether they are the manufacturers and not just a middleman.
- Whether they possess the technical skills and manufacturing capabilities necessary to deliver on their promises.
This may be accomplished in a variety of ways. You might request the factory’s audited finances, a copy of its Value Added Tax invoice, and product samples. You might also find out the factory’s Chinese name, location, and also the local government agency in charge of it. This office will hold the factory’s registration data, which you may use to confirm the information they’ve given you.
3. Keep In Mind That Quality Is Directly Linked to Cost.
Why do buyers all across the globe go to Chinese providers for their needs? One of the critical reasons is low production prices, which wind up being less expensive for the buyer than sourcing from somewhere else in the West, even with shipping and customs. When negotiating with prospective suppliers, keep in mind that all manufacturers have a price floor – the minimal cost to create the goods.
This gets us to the first of two points. One, if you’ve done your homework on the product, raw material prices, and the market, you’ll have a good notion of what this pricing is. Choose vendors that give you a price that is far lower than this. Two, customers with large orders (the ideal purchasers in the supplier’s opinion) may aim to lower their selected supplier’s pricing even more. You should utilize high-quality materials, especially for consumer product packaging. No one wants to purchase expensive items (such as cosmetics) with shoddy packaging because of an unrealistic price point that will force corners to be taken.
In any case, keep in mind that if suppliers fall below their minimum pricing limits, it will impact elsewhere. It might show as a decrease in the quality of raw materials or as a decline in employees’ salaries or working conditions. It may also result in the supplier skipping stages in the quality control process. In the long run, all of this has an impact not just on your goods but also on your reputation, and it may even have legal ramifications.
4. Be Clear and Specific in Your Communication
When sourcing in Asia, bear in mind that there is still a language and cultural barrier to consider. Though some larger suppliers are likely to offer English-speaking customer service, many difficulties between suppliers and consumers may be traced back to communication errors. “Knowing what was said” is not always synonymous with “understanding what was intended!” Of course, none of this is intentional, but if buyers keep this in mind, they may avoid expensive errors and delays.
Because of the communication gap, everything of your needs – from product specifications to package quality and type to whether instruction manuals are necessary and their content – must be placed in writing, explicitly and in detail. Allow no room for the supplier to make assumptions, and urge them to ask you a few questions if they are unsure about anything.
5. Inspections For Quality Control
While a good manufacturing deal is a fantastic approach to start your partnership with the supplier, frequent quality control inspections are required to verify the quality of your product meets your requirements. This helps to avoid expensive errors in the future. According to research, faults discovered later in the manufacturing process usually cost more than those discovered early.
While these five guidelines are a fantastic place to start for individuals new to the business of importing from China, global sourcing agencies like Sourcing Allies handle most of the research and due diligence indicated above. When you buy something from Sourcing Allies, for example, they have a team in China that helps you get quotes, look at factories, communicate your manufacturing needs, get quality checks, ship and transport the goods, and make sure they get to where you want them.