Over the years, I have worked with many small and midsize importers who were looking for a good supplier. A very common question they have is “what kind of factory should I look for?”
The problem is simple to grasp:
- Small factories give low quotations, but are not very reliable — especially when they need to develop a new product.
- Larger factories are (usually) more reliable and more professional, but are unwilling to give low prices to small buyers. And they are more likely to bump small orders behind more significant ones, to subcontract them, or to assign a junior salesperson for follow-up.
So, new-to-China buyers keep trying new suppliers that offer low prices, and think “I am sure there is at least one good factory for me in this country”. This search can last for years.
Where it gets really, really difficult is for buyers who have a quality standard above average.
Here are a few ideas to solve this dilemma
1. Maybe China is not for you
2. Do not be afraid of working with a trading company
If your orders are small, maybe an intermediary can place them in a small workshop. You cannot deal directly with a small structure that does not employ any English-speaking staff.
In this case, choose a trader with good customer references and a good knowledge of your products. And take control of the QC inspection process — you should be the one deciding whether the goods are acceptable or not.
3. Try to seduce a large factory
One of the big guys might be willing to decrease your prices. Maybe you can convince them that you will be a good reference to get new customers in your country. Maybe they think they can use your designs to “wow” prospective buyers. Or maybe they will see that your business is easy (mostly repeat orders, few new developments).
What some importers do is they give their complex products to a big factory at a higher price, and make most of the margin on simple products that are made in smaller, cheaper workshops.
4. Start narrow, and start small
When you test a new factory, give them 1 or 2 new products. But do not expect them to devote all the engineering attention required for developing 15 new products.
Start with small order quantities, but not so small that your supplier canot convince its sub-suppliers to serve your needs.
If possible, let the new factories choose which type of product they prefer to make in low quantities. A small production run of some of your models might be impossible.
5. Do not get stuck in one area
Sometimes there are many manufacturers of one product line in one city. But in China, industries are often spread out in several provinces. If you cannot find your luck in one city, go and explore some other area.
By Renaud Anjoran, founder of Sofeast Quality Control that helps importers improve and secure their product quality in China.
More Business articles from Business 2 Community: