China’s rapid rise as a low cost manufacturing hub for top quality products has made many companies from around the world rush into this market for production of their goods. Companies ranging from the retailing giants to the industrial enterprises are all considering China resulting in an expansion of the Chinese manufacturing industry. However, in order to make your China manufacturing a business success, there are some simple strategies that you can incorporate to secure the best products from the Chinese factories.
The major factors involved in successful product sourcing from China manufacturing hubs include the following:
· The qualification of new Chinese suppliers
· Choosing a purchasing method
· Ensuring quality control when outsourcing manufacturing to China
· Building a strong buyer-supplier relationship that will be critical to success when it comes to Chinese product sourcing.
Below is a brief overview of 10 important things that you should get right when building a business that will be based on overseas manufacturingnetworks in China:
· Doing a thorough background check on your Chinese suppliers: This is an essential requisite when planning to source products from the Chinese market. It’s important to ensure that you are working with the factory itself and not just some intermediary affiliates. Also, checking their credibility and track record with previous clients can eliminate existing trust issues. Maybe you can connect with their other clients through LinkedIn and ask them to share their thoughts about doing business with the supplier.
· Auditing the factory: Before you commit to any particular factory, it is important to carry out a complete audit of the company that you’re dealing with to ensure that they adhere to sound moral and environmental standards. It’s also important to ensure that the factory is the right fit for you in terms of product quality and business goals.
· Avoid making upfront payments: This can put your business at risk. Negotiate on OEM agreements that will give your company value when it comes to China manufacturing.
· Clearly define what you want: Be vocal about your expectations in terms of your specifications and delivery times. These need to be highly precise in order to avoid incurring extra costs that can deeply impact your business. Apart from merely defining and describing what you want, it’s also important to ensure that the factory that you will be working with clearly understands what you want. In many cases, it may be necessary to have professional sourcing consultants with a good understanding of Mandarin or Cantonese in order to smooth out negotiation procedures without anything being lost in translation.
· Quality Control: It is important to regularly perform quality control inspections to your products to make sure the best standards are adhered to. While a good Manufacturing Agreement will cover many of the quality control aspects, it is not sufficient in maintaining high product quality.
· Relationship: If the relationship is good, it may be advisable to stay with the same supplier in the long term as this will guarantee stability and predictability in your outsource manufacturing.