China has become the world’s leading manufacturing center. From electronics to plastic products China has it all. It is no surprise that more and more companies are sourcing products from China. Few countries can compete with China in terms of variety, quality and price.
Whether you are a business owner or a purchasing manager, one of your main goals is to purchase high-quality products at the best prices. Obtaining quality products at low prices can increase the cost-effectiveness and profitability of your business.
If you are new to sourcing products from overseas, you must wonder if sourcing from China is right for you. You may wonder if it is worth the risk. If done well, the benefits of sourcing from China far outweigh the risks. However, in order to obtain these benefits, you should develop a well-thought-out strategy to ensure that you get the highest quality products with minimal risk.
Here are seven useful tips for your China procurement strategy
Use China sourcing agent
Sourcing agents perform outsourcing activities on your behalf. You may want to do it yourself instead of hiring someone else. You might think that all you need to do is visit China in person and talk to some suppliers. It sounds simple, but have you considered the following obstacles? Do you speak the local language? Do you understand local business practices? Do you understand licensing, certification, and other legal requirements?
A good China sourcing agent can handle the entire purchasing process. From getting a quote from a reliable manufacturer to shipping the product to your warehouse, the agent does everything.
Choose experienced China sourcing agents, not only have offices in China but also have fully staffed offices in China. They are fluent in local languages and dialects and are proficient in business practices. With many years of experience, this agent will help you to establish contact with reliable manufacturers or suppliers who specialize in the products you need.
Take a moment to choose the right agent for your business. They can eliminate all your worries about outsourcing, allowing you to spend your precious time on other key business activities.
Verify Your Agent’s Credentials
Just as important as hiring the right agent for your business, verifying their credentials is just as important. Do not choose the name that pops up in Internet searches. Be sure to spend time researching agents and verifying their credentials and tracking records; this is an important step that cannot be ignored.
Find the following:
Where is the agent? Doing business with foreign agents is much easier than doing business with Chinese agents. It is very difficult to obtain accurate information about Chinese companies. We recommend choosing a foreign agent with local business in China. Verify their trade license before you start the discussion.
How long has its China office been in operation? Find out how long their China office has been in operation. Your agent must hire experienced employees in their local office in China. Working with a suitable agent with a good track record can help your business achieve leapfrog development.
Can your agent provide real recommendations from business owners who have used their services? Be sure to check these references. Talk to business owners as much as possible and ask about their experience.
How does the agent deal with quality issues? The main attraction of sourcing from China is to obtain high-quality products at affordable prices. Choose a method that prioritizes quality. They must make it clear to the Chinese manufacturer that products with substandard quality will not be accepted.
Does your agent speak fluent English? Good English language skills-spoken and written, are not negotiable. Ideally, you should choose someone who has office staff in China and speaks and writes English, because in some cases you may need to talk directly with their employees in China.
Hiring the right agent is a key step in successfully sourcing products from China. Ask the right questions to ensure you work with the right agent to help you grow your business.
Know What Product You Want
In order for the procurement process to be successful, you must provide your sourcing agents and manufacturers with detailed specifications of the materials or products you want. Be very clear about the products or raw materials you want. Don’t assume that everything is implicit, because doing business in China may be very different from doing business in the West.
Failure to provide detailed specifications may cause confusion, and you may end up with something different from what you ordered. You will end up wasting a lot of time and money to buy the right products.
If possible, please provide detailed drawings. If you are currently manufacturing your product, you may need to send them samples. If you need to make changes, make sure to provide detailed written specifications.
If you want to order raw materials such as aluminum or steel, please specify the required grade. You may also want to specify the raw materials to be used to minimize the risk of getting the wrong product.
For colored products, please specify the color code. Make sure you specify the exact raw materials you want to use to make the product. Send photos whenever possible.
Check Sample Before Placing an Order
Although detailed instructions are provided, it is always possible that the products you receive do not meet your specifications. To avoid this situation, please insist on providing samples before placing an order.
The first sample you receive may or may not meet your specifications. If the product does not meet the specifications, please clearly note the problem and inform your manufacturer. Your feedback will help the manufacturer make changes to the product, and then they can produce accordingly.
You must also clearly understand the number of goods you need. If you seem to be a valuable commercial source, the manufacturer is more likely to pay close attention. If they think you might only place a small order, they might not be so sensitive.
In this case, your sourcing agent can also help. They can help you find reliable manufacturers who pay attention to details. They will work hard to ensure that the manufacturer accurately understands your specifications. The responsibility of the sourcing agent is to provide you with sample products and fine-tune them according to your design and specifications.
When you receive a sample product from the manufacturer, please take the time to test it. The product must work normally and meet customer requirements. You may want to show samples to relevant employees in your organization so that you can also get some feedback from them.
The safest way to source products from China is to control quality. If this is your first time, you may want to visit the factory yourself to check the quality of the products. If this is not possible, hiring an independent quality inspector is also a good idea. Your agent should help you find a reliable quality inspector.
It is very important for the quality inspector to provide you with an independent report on the quality of the product. Always be careful of the people you hire. Don’t hire someone without thoroughly verifying their credentials.
It may be a good idea to hire a quality inspector; however, you cannot do this for every order continuously. What you need is to establish a well-structured quality control plan.
You must have a quality management plan managed by you and your agent. You may also need to visit factories in China on a regular basis to ensure that your quality control plan is running as expected. Carry out sampling inspections and never miss the quality documents of the verification supplier. If something goes wrong, you may need to hire a quality control inspector again.
Understand the Quality Controls
Monitoring product quality is primarily the responsibility of your agent. However, knowing quality control yourself can also be a great advantage.
As a customer, it may be helpful to know the following:
Review process: Understand how your agent reviews new suppliers. Understand whether the agent will check the supplier’s experience, track record, license, and certification. You must know whether your agent has put in enough effort to connect you with a trusted manufacturer.
Factory audit: Before recommending a manufacturer to you, your agent must visit the factory to understand how the product is made. Your agent must have a good understanding of the factory capacity, delivery time, and other customers of these manufacturers.
Quality certificate: Your agent must check the authentic quality certificate of the manufacturer that they work with. Not all Chinese manufacturers have these certificates. Don’t be a victim of these manufacturers. Usually, the certificate is in the local language. The benefits of your agent are obvious because they understand the language and will check these certificates before recommending the manufacturer.
Authorization certificate: The authorization certificate is an important document that your agent should be able to provide you with. The certificate is evidence that the agent is authorized to supply goods overseas from the manufacturer. With this certificate, you can ensure that you only source products from certified manufacturers.
7. Reasonable Pricing
Affordability is one of the main charms of sourcing from China. Cheap labor and technological advancement help Chinese manufacturers provide affordable goods. But when it comes to the cheapest items, it’s best to avoid them. Manufacturers may cut corners and provide you with cheap products. The quality of such products may be far from ideal.
In addition, the Chinese manufacturing market is booming. New manufacturers and factories are emerging every day. New entrants may agree to manufacture your goods at extremely low prices, but they will compromise on quality in some way. The established factories will provide better quality goods; the price of this quality is higher. When formulating a China procurement strategy, you must keep pricing in mind. However, this should not be the only deciding factor.
Your agent will provide you with multiple quotations from different manufacturers. Don’t just focus on the lowest price. Instead, choose a mature factory that prioritizes quality and has a good track record of serving other companies like you.
If you want your business to grow and increase the number of loyal customers, you must provide high-quality products. You must only work with suppliers who provide competitive products without compromising quality. Yes, they may cost a few dollars more, but they are well worth it.
“How do I pay my China suppliers?” is a key question that must be asked when considering payment methods for your business.
Purchasing products from China can greatly improve the cost-effectiveness of your business. You can get high-quality products made exactly according to your specifications at a very affordable price. Now more and more companies are interested in purchasing from China to gain a competitive advantage and increase profit margins.
Despite the advantages, sourcing from China also needs to be very careful. If done well, it may do wonders for your business. However, if something goes wrong, your business may pay a high price.
You must take all precautions to ensure that the risk of sourcing from China is minimized. Cooperating with a trusted and mature sourcing agent is an important step. A suitable agent can help you familiarize yourself with how Chinese companies operate. You will also gain insight into the different licenses and certifications that need to be checked before ordering products from China. Before hiring an employee for your business, make sure you conduct due diligence. Finding and using suitable agents will quickly prove that the benefits of sourcing from China far outweigh the risks.
Union Source – your best China sourcing agent was established in 2005 specializing in our client’s general merchandise procurement and export. We offer all-in-one China sourcing solutions covering product design, development, raw material sourcing, factory selection, production management, product repack, quality control, global logistics, e-commerce products, and logistics.
Grow your business with us.