Importing from China is a daunting task. There are hundreds of thousands of factories throughout China whose quality and capabilities cover a wide range. Finding the right supplier is crucial and most people underestimate the time and resources required to set up a successful operation. Quality and trust are the #1 concern for professionals working with low cost country sources.

Options for Establishing China Sourcing Partners

Project Management Infographic-1

1. Trade Shows

Pros

  • Opportunity to talk to potential suppliers face to face about their companies, products, productions capacity, quality-control procedures, and other key business areas
  • Direct interaction helps in evaluating suppliers and verifying their abilities
  • See product samples first hand

Cons

  • Requires international travel
  • May be limited to a small pool of potential Chinese suppliers (many of them don’t attend these trade shows)
  • Not all representatives attending trade shows are actual manufactures (some are brokers or wholesalers)
  • Many Chinese exhibitors have limited spoken English skills

2. Online Resourcing (Alibaba, Global Sourcing)

Pros

  • Simplest, least expensive method to identify suppliers
  • Huge range of factories (more than a trade show)
  • Tolls and information provided; easy to use
  • Ability to contact multiple suppliers quickly at once
  • Good for small, low value items

Cons

  • High-risk sourcing method
  • Risk of fraud (some businesses may not be what they seem)
  • Hard to distinguish actual factory reps vs. brokers
  • Outdated information
  • Takes a lot of time and effort to communicate back and forth by email
  • Details lost in translation; lack of clarity
  • No personal relationship
  • Must conduct your own due diligence; no on-site factory audit

3. Agents

Pros

  • Help identify and verify suppliers and facilitate communications
  • Someone is on ground to conduct quality checks
  • Lots of agents can be found online
  • Fees range from 3 to 10 percent of purchase price
  • After working with sourcing agents a few times and becoming familiar with process, you can eventually manage deals without their help

Cons

  • Lack of ability to know true cost
  • Hard to regulate performance and commission – no incentive to keep costs down
  • Might be hard to find trustworthy agents – difficult to check references
  • Lack of familiarity with specific industries (but may not admit so up front)
  • Agents not staffed equipped or sophisticated enough to manage production and quality control or offer support
  • Won’t necessarily have clients’ best interests in mind (usually operate based on personal relationships)

4. Full-Service Project Management Firm

Pros

  • Most convenient and risk-free sourcing method
  • Scale – have leverage with factories with volume of other clients
  • Handles entire sourcing process from beginning to end
  • Provide wide range of services: supplier identification, price negotiation, supply management, quality control management, logistics and shipment management, and other sourcing matters.
  • Can respond quickly to urgent matters
  • Have only clients’ interests at stake (not beholden to specific factories)
  • Cost savings from avoiding international trips
  • Relieves hassle of identifying and verifying suppliers, productions inspection, product quality control, and logistics
  • Allows focus on existing U.S. sales and opperations

Cons

  • Front end fees for managing relationship
  • No opportunity to learn about Chinese Markets

 

distribution warehouse with trucks awaiting loading.
Container ship and transport aircraft in export and import business and logistics. Shipping cargo to harbor by crane. Water transport International. Aerial view and top view.

Contact Us

  • Accepted file types: jpg, gif, png, pdf.
  • This field is for validation purposes and should be left unchanged.