Trading with China

Unless you’re a large company with your own manufacturing capability, you’ll probably going to be sourcing your wares from China!

With the advent of sites such as alibaba and made-in-china, dealing and trading with Chinese has become accessible to everyone!

When dealing with Chinese manufacturers, you need to be careful. Melamine in baby milk powder? Asbestos in Cars? Sometimes if you let them take shortcuts, then they will. If you don’t let them, they won’t. I think it’s that simple.

  • Its all about relationships
  • Instilling Quality Control  (QC) is YOUR problem

The basic flow of events goes like this:

  1. Get Sample
  2. See the photo of sample
  3. Pay for sample and have it shipped.
  4. Verify the sample – does it meet specifications? Are you happy with it?
  5. If you’re happy, go mass production – 30% down payment
  6. Before they get shipped to you, go to the factory in China , or get someone you know to go to the factory.
  7. Random sample QC / QA on the production units and ensure you’re happy with it.
  8. Pay the 70% outstanding
  9. If all goes well, you’ll have mass produced your product in China

Obviously, things don’t all go well! The production units or the samples might not be up to standard. Units may fail to even work!

What can you do?

It’s important to do as much BEFOREHAND to ensure you get a good deal. Firstly, make sure you have built a good relationship, they’ll be happy to help you if you have dealt with them before and are a good source of hassle free business.

Ask these questions:

  • Do they attend any Tradeshows/TradeFairs
  • What other clients do they have? A track record to show? Get references
  • Make sure you tell them what you want… And then get them to tell you what they’ll give you. This is a way of making sure that your requirements have been fully communicated.
  • Are they are manufacturer or an agent?
  • What sort of Guarantee or Warranty do they have?

They should accept a 30% deposit and 70% full payment before shipment. It’s important that they agree to YOUR terms. You have to sort of show them who is the ‘boss’.

If they do something not to standard, don’t simply change suppliers – this can be costly and time consuming. Instead, try to work it out! Get them to fix it at their cost. Remember, this is a relationship we’re trying to build here, not just a simple business transaction.

A lot of the time in business, things go wrong because there is miscommunication. It’s the same here in China too! Make sure your specifications are all written down to the LETTER! If you give them room to mess up, they sure will and can! They’ll give you everything they ask for, but for things you don’t specify they’ll just use the dirtiest and cheapest option! Don’t go down this path, unless that’s what you want!
If you’ve had dealings with China, please post a reply or a comment! I’d love to see what you think!


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