As the devaluation of CNY(RMB or Yuan), people can get a lower price when importing products made in China. But, no matter what you are purchasing from China, you always try to find a good or better manufacturer in China. You choose to cooperate with the Chinese suppliers because your aim is to import goods from China at lower cost.
Product at low price is easy to find in the Chinese market, but, product at both low prices and good quality is not easy to be discovered. In someone’s mind, products made in China are equal to bad quality. Yes, it is true that lots of products made in China were shipped to oversea in the past, but new it is different. Most of those factories have closed, because people from all over the world are not willing to buy product made from those irresponsible manufacturers.
So, people needs to find good manufacturers when having a plan to source products from China. In this supplier development guide, I’m going to show you exactly how to find reliable manufacturers in China.
Ten Steps to Find China Manufacturing Companies
Step 1: Understand What You Plan to Purchase from China
You need to well understand what you need before making a plan to import from China. Retail and wholesale are the two different business models. And you need to find the different types of suppliers. If you are a small business, it is hard to negotiate price with large-scale manufacturing company. However, you will get a competitive price if you can place a large order. So, understand what you need and how is the volume is the first step to develop supplier. Here are some points you need to get answer before going forward.
- The range of your products planned to purchase from China.
- The types of your business, such as retail, wholesale, trading, design office, and manufacturing companies, etc.
- The volume for each products.
- The forecast for the size of order each time.
Step 2: Discover the Ways to Find China Manufacturing Companies
There are lots of ways to find China manufacturing companies, but you should choose the most economic one. Alibaba and made in China are the most famous B2B sites to find Chinese suppliers. Trading shows is the best way to discover real manufacturers. Here are the methods to find manufacturing companies from China.
|Enterprise Style||Range||The Ways to Find Chinese Sources|
|Small Business||Retail, Self-employed, Design Office, eBay and Amazon Seller, and Start-ups, etc.||B2B Sites, Google, B2C, and Sourcing Agent.|
|Trading Business||Sourcing Agent, Wholesaler, Online Shops or e-commerce, and Trading Company, etc.||B2B Sites, Google, and Trading Shows.|
|Manufacturing Enterprises||Factory, Large-scale Company, and Brand Owner, etc.||B2B Sites, Google, Trading Shows, Visit in Person, and Third-Party Supplier Development Company.|
Step 3: Learn How to Verify Suppliers in China
Besides learning find the suppliers in China, you need to learn how to verify the sources as well. Because some of dishonest companies were lying they are real manufacturing companies. Here are some common ways to verify a real manufacturer.
- Check their business scope. A real manufacturing company should have some words, such as manufacturing, produce, and assembly.
- Apply to your potential suppliers for some pictures and videos.
- Visit their website. If the range of products is too wide, it should not a real manufacturer. For example, a die casting manufacturing company should not sell plastic toy products.
- If the number of employee is less than 30 and the address is room or suite XXX, it should be a middleman.
- Supplier information card and self-assessment reports are the useful documents to verify a real manufacturer.
Step 4: Know What Agreements You Have to Sign When Doing Business With Chinese Companies
Do business with Chinese company is not without risk. Poor quality, cannot deliver on time, and products can not math the requirements are the considerations when importing from China. So, you need to sign some agreements when doing business with the companies from China.
- Business contract is the most important one. Make sure all the terms and requirements are wrote into contract, such as quality control requirement, payment terms, price rules, lead time, and inspection methods, etc.
- Don’t forget to sign Non-disclosure Agreement (NDA) and exclusive dealing agreements if the product is designed by you.
- Proprietary notices on tooling(mould), fixture, and sample.
Step 5: Find China Manufacturers as Much as You Can
I assume you have some knowledge related to manufacturing sourcing in China. In this step, you will start to finding potential manufacturer. As we mentioned above, you choose the right ways to find China manufacturing suppliers, the more, the better.
- Manufacturing products: we suggest find more than 20 suppliers.
- Common commodities: we suggest find more than 10 suppliers.
- The companies based in the cities at Yangtze River Delta and Pearl River Delta are the first consideration.
Step 6: Communicate with Potential Suppliers for Confirming They can Understand Your Requirements
Contact these suppliers and tell them your requirements. Communicate with them and make sure they can understand your requirements, especially the critical points. In most cases, China supplier can not supply the products match requirements due to they misunderstand the requirements. Appearance, packing, carton, dimension, and function are the important topics to discus.
Step 7: Request for Quotation
You now have some reliable manufacturers and release RFQ to them. And you should sign NDA with supplier before releasing any documents to China if it is necessary. In this step, you need to do the following things.
- Negotiate for a better price and payment terms.
- Narrow down the list of China Manufacturing companies you are interested in. 3~5 potential suppliers are enough.
- Supplier who can give price analysis should be appreciated.
- Please don’t consider the supplier who offer the bad services or don’t give you any feedback within 2 working days.
Step 8: Ask Potential Suppliers for Free Samples
Most of the reliable manufacturers in China are willing to provide sample for free, but you need to pay the freight. However, some products are customized and it is impossible to provide the sample before building. In this case, you should ask you suppliers for same row material and product which is similar for reference.
Step 9: Visit Manufacturer in China
After getting samples and quotations, you should visit and audit the factory if you looking for a strategic sourcing supplier in China. You can do it yourself or hire a third-party service company to audit it. DiscoverSourcing.com suggests you to hire a third-party procurement solutions company if your fund is limited. Here is our solutions for strategic procurement.
- Third-party audit suppliers and check samples before mass production.
- You inspect products before shipping at the first time of mass production order.
- Third-party product inspection service company check products before shipping ever time.
Step 10: Choose Your Business Partner in China
You can select your Chinese business partner now. But you still have to note the following points when choose a real manufacturer in China.
- Please don’t select a manufacturing company who have few experience on your products.
- A supplier who called XX factory is a self-employment workshop.
- A companies’ registered capital more than CNY2,000,000 is appreciated.
- Please don’t select a manufacturer in China who registered in the almost two years.