10 Tips for Finding a Quality Supplier in China
Most Common Tips for Finding a Quality Supplier in China when you source form China
A guide to help you better understand and avoid mistakes when communicating with Chinese suppliers
When working with suppliers, you can’t expect them to think the same way you do. Western thinking and Eastern thinking are very different, and you can’t force Western thinking onto your suppliers.
It’s easy to get frustrated by mis-communication. To help you be prepared, here’s a list of the top 10 mistakes sellers make when working with Chinese suppliers.
10 Tips for Finding a Quality Supplier in China
#1: Don’t thinking that a factory, trading company, sourcing agent, manufacturer, and supplier are all the same thing.
There are a lot of terms to keep track of in this industry, and a lot of them have some overlap, but knowing what’s what will save you a lot of frustration.
A factory is the location where your product is built, whether by people or machines.
A trading company is a middleman. They find the supplier for you and they ship you the product, but before they ship it, they raise the price a bit to make their own profit.
A sourcing agent is similar to a trading company, but not the same. They’re more like a liaison. Sourcing agents might put you in direct contact with different factories, or vet multiple suppliers to find you the best price. They also usually provide factory and product inspections, and shipping and logistics opportunities.
The terms manufacturer and supplier are used very loosely. They could overlap with any of the previous three terms.
Then we have what they call manufacturers and suppliers. These are used very loosely. As a general rule of thumb, they could be any of the previous three. Often a manufacturer is synonymous with the factory, while the supplier is even more broad.
#2: – Don’t evaluating the price only
With all quotations in hand, it’s time to select the suppliers. Although prices impact business profitability, it’s important to consider that the cheapest supplier isn’t always the right one. On the other hand, the most expensive supplier isn’t a guarantee of the best possible services.
Instead, it’s better to address issues related to quality, flexibility and delivery experience in that particular area. This will provide a fuller idea of how the provided service will be, and will prevent you from receiving something cheap, but very unsatisfactory.
Beware also of those not-to-be-missed offers. If the product proves to be of quality and the provider company is a large-sized one, a price far below the market’s may be a sign that there is something wrong.
#3: Don’t trying to negotiate on shipping.
There’s a big difference between comparing shipping prices and trying to negotiate on shipping. There’s only so much suppliers will be willing to negotiate with you on shipping, because they have to charge a minimum price. Sometimes, they’ll charge you exactly what shipping costs them, and sometimes they’ll charge you a little extra, because they have to make money, too.
Trying to negotiate on shipping might make a supplier think you don’t know what you’re talking about, and then they’ll be less likely to want to continue working with you. So, don’t negotiate on shipping; just compare shipping prices between a few different suppliers to find the best deal.
#4: Don’t thinking that most suppliers on Alibaba are factories.
A lot of suppliers on Alibaba will tell you they’re factories, even if they’re not, and that’s normal. For them, it’s just good business. But the majority of them are probably just trading companies who have bought their products directly from factories and raised the price a bit to make a profit when reselling them.
#5: Don’t assuming a supplier must be a factory because they call themselves a factory.
Just because a supplier shows you pictures of a factory doesn’t mean they’re really a factory. Nowadays, you can build a website and put whatever you want on it – and so can suppliers. But that doesn’t mean they’re trying to cheat you or scam you. They just know that Western brains think going directly to the factory will get them the best price. However, that isn’t always the case.
#6: Don’t thinking that working directly with a factory means you’ll be paying less.
Often, trading companies can offer you better prices than factories. Why? Because they have great relationships with factories, so factories give them better deals. If you’re new to working with a particular factory, it’s going to take time for you to earn their trust and build a good relationship with them. Factories won’t start giving you better deals on products until they trust you. However, factories already have good relationships with trading companies, so trading companies get better deals. Then, those trading companies pass those deals on to you.
#7: Don’t thinking it will only take a month to get your product sourced and shipped to Amazon’s warehouse.
If you’re building a highly customized product, it’s obviously going to take time to build. Expect custom products to take up to six months, easily, from the start of product research all the way to the day you ship your product to Amazon FBA. In this case, I highly recommended using a sourcing agent to help walk you through the process.
Even if you’re not building a brand new product, research, differentiation, production, and shipping still take time. Budget at least two to three months for sourcing and shipping your product.
#8: Don’t not working with a sourcing agent
Particularly when you are starting out with your Amazon selling business, it is important to get the guidance and support from the right experts. Failing to do so can expose your business to serious risks, including fraud, product quality issues, and legal risks.
A China sourcing agent is well-versed in all aspects of sourcing products from China for Amazon sellers and offers assistance throughout the process. Starting with selecting the right supplier, negotiating the best price, and shipping the order; even experienced sellers benefit by working with a reputed sourcing agent.
As the sourcing agent has an office in China, not only can they carry out a visual inspection of the manufacturer’s facility but they can ensure a fair deal while building a strong relationship with the local supplier.
The sourcing agent also conducts a factory audit and performs an objective assessment of the staff, equipment, processes, automation and management structure, as well as other factors such as social responsibility or sustainable sourcing.
#9: Don’t assuming that just because you signed a contract with a supplier that they won’t share your idea.
What if, a month after you launch your newest product, you see it being advertised by your supplier, and by twenty other suppliers on Alibaba? Don’t ever assume suppliers are going to honor your contract. Instead, find ways to de-risk yourself.
One way to stop your product from getting hijacked is to have one supplier build all the pieces of the product separately. Then, have those pieces shipped to you and assemble the product yourself. That way, your supplier doesn’t know what the product actually looks like. The final product is yours alone.
Another easy way to de-risk yourself is, of course, by differentiating. Add accessories and extras to your products, and they’ll be harder to duplicate.
#10: Don’t assuming there is something wrong with a supplier who won’t drop the price until you meet a certain MOQ.
Imagine you’re shopping for coffee. You go to Wal-Mart and you buy a bag of coffee beans. Then, you go to Sam’s Club and buy a massive bucket of coffee beans. When you break the price down, the cost per bean at Sam’s Club will be much lower than the cost per bean at Wal-Mart. Why? Because you’re buying a greater quantity of beans. Buying things in bulk is cheaper. The supplier wants to know the time and labor spent building your product is going to yield a big enough sale to be worthwhile. Suppliers won’t lower their MOQ if it isn’t worth their time.
10 tips for finding a quality supplier in China conclusion
These are a few of the most common mistakes sellers make when finding a quality supplier in China. It’s important to learn how to work effectively and efficiently with suppliers, so you can get your products up and selling as quickly and easily as possible. Don’t make these newbie mistakes; learn to work with the Eastern way of thinking, and you’ll be sourcing million-dollar products from suppliers in no time.