Few Mistakes to Avoid While Sourcing from China

Now China has become the world’s factory and all business companies prefer to buy various products only from China. The basic reason is China has a very high capacity of production and also Chinese goods are available at unbelievably low cost.

Since China has an abundant source of cheap and well-trained labour, and also the government has created an excellent infrastructure for manufacturing various items. As a result, they are able to offer various products at a very low cost.

However, every deal that you make with a Chinese company will not necessarily going to benefit you. Unless you have a proper strategy while sourcing from China and have a good sourcing agent available in China you may not achieve the desired results during your China sourcing process.

Besides, there are many issues that may crop up unless you are proactive enough and avoid a few mistakes that we are going to discuss in this article.

Mistakes that you must avoid while China sourcing

There are a few mistakes that may happen during the China sourcing process. First, you need to know those mistakes that are as follows:

  • Poor planning of sourcing strategy

You must plan your strategy for sourcing carefully to make your China sourcing to be really successful. Without a really good sourcing strategy, dealing in money and supplies with international liaisons can become complex. A strategy will act as your road map to guarantee that you have clear objectives in mind and that you are able to attain them through sourcing.

You should also have a strategy in place for sourcing, whether it will be through direct import or on a certain commission basis. Quality control is essential, and you should obtain insurance to safeguard yourself in the event that any problems develop.

  • Failing to do a proper audit of the Chinese supplier

Before placing your order, you must audit the factory in China. To do this either you can visit China personally or you can take the help of any third-party auditors that are also available in China.

An in-person visit has a few advantages as you can establish a personal rapport with the higher management of the company, which is very useful, particularly in China. This may help you to do long-term business with any Chinese company.

In case, an in-person visit is not feasible then the only alternative is to get the factory audit done by a certain third-party auditor.

  • Not ordering any product samples first

You cannot expect all suppliers can produce products that will meet your entire specifications. You might have clearly explained all your requirements and also specifications, however, that is no guarantee that your supplier has understood or gone through all of them.

Therefore, you must demand a few product samples for your evaluation before you finalize your agreement with the Chinese supplier. You must check the samples thoroughly and if it needs any correction then clearly tell them.

However, if you find the sample quality is too poor then you must reject the supplier.

  • Failing to do due diligence on your suppliers

During the China sourcing process, if you like to avoid any scam you must carry out a proper inquiry about your potential Chinese suppliers. You may do the following:

  • Check various online reviews
  • Review the supplier’s website
  • Verify the registration and other certifications
  • Check business license
  • Lack of enough protection for any quality issues and your payments

Poor quality has been the biggest issue with the Chinese products, though there are improvements noticed, however, to protect yourself you must always link the payment with quality issues.

You need to frame a proper contract by consulting your legal advisors. Your definition of quality must be very clear on the contract so that you may not suffer any monetary loss.

  • Poor cost forecasting

Often looking at the cost of products offered by a Chinese supplier, may blow you up and you start imagining the profits that you are going to make. Just chill and try to find many hidden costs that will also be associated with it.

You need to factor in all the other expenses like shipping costs and many other custom duties that you have to pay. You must calculate your total landed cost and then decide what your real cost of products would be. After knowing that only you can negotiate with your supplier in China.

  • Poor communication of your needs

The cultural differences, and the barrier of language, can often become spoilsports. You may often assume that your Chinese supplier has properly understood all your requirements, however, China’s culture may not allow them to seek clarifications. As a result, often serious miscommunication may happen.

Ensure that all specifications are provided in writing and also explain again to your supplier. Better encourage them to speak so that they ask whenever in doubt. Better hire a Chinese-speaking member who also knows English during the discussion.

How should you manage everything?

In fact, you need not manage everything during your China sourcing process. If you are smart enough then the first thing you must do is find a suitable trustworthy sourcing agent in China.

There are many China sourcing agents available who are quite proficient in speaking both English and Mandarin languages. An agent will take care of most of the activities on behalf of you.

Selecting any good China sourcing agent to meet all your specific needs will sometimes be quite a challenging task. It is as difficult as deciding on your Chinese supplier yourself. Therefore, make sure that your China sourcing agent must have the following attributes:

  • Strong presence in China, and also must have a team with an office
  • Agent’s office should be close to your Chinese manufacturers, which can make it easier for the sourcing agent to address any issues with your order
  • Should have the excellent communication skills both in Mandarin and English
  • Sufficient experience working as a sourcing agent in China
  • Good knowledge about the product that you want to import from China.

We hope with this info, your China sourcing process will be much more smooth and you can meet your objectives.