Buying products from China is overwhelming for many reasons. It can be concerns associated with Chinese manufacturers, language barriers, shipping costs, complicated import processes, and more. If you are new to outsourcing product manufacturing to China then it is crucial to gain knowledge about the mistakes to avoid. A lack of China product sourcing knowledge can be risky. If you are aware of possible challenges encountered then you can avoid them with ease.
Avoid mistakes associated with sourcing imported products from China
Choosing wrong product
Choosing the wrong product because buying complex goods will make it difficult to maintain standard quality. For example, electronics or jewelry is complex products because it needs to buy different parts from sub-suppliers. Therefore, the quality standard is minimized. The manufacturer can misunderstand product specifications.
The project can turn out to be costly. Even hand-made products with high labor costs can trigger quality issues like excess glue or untrimmed threads. Never think about choosing counterfeit products because your business can encounter legal action.
Ignoring to send product specifications
Chinese manufacturers need buyers’ specification documents. Generally, products are manufactured per batch, which differs. The Chinese suppliers offer machinery and labor, buyers need to tell what to produce. Without sending product specs, the quality can be compromised. Even a reliable supplier can misunderstand, so supply clear specifications.
Choosing a poor supplier in China
China product sourcing carries an inherent risk and that is choosing the wrong supplier. Signs of unreliability are unable to offer product details, poor response, unwillingness to answer queries & profit-centered, consistently changing product rates, and can’t offer average lead time.
Reliable manufacturers are professional and show a positive attitude in nurturing long business relationships.
Ignoring factory audit
Partnering with a supplier without a factory audit is not recommended. The manufacturing facility needs an inspection to evaluate internal quality management processes. It is essential before signing and placing massive orders.
Overestimating profit margin
The estimated margin is hard to calculate when you are sourcing products from China. Get a quotation from a reliable supplier and compute product landing costs overseas.
Landing cost means the total product cost you pay from the seller’s warehouse to your overseas warehouse facility.
Buy without comparing prices
You can ask for several quotations from an online supplier in China. Compare and filter the best business supplier. Pricing is the first thing to consider. Do some research about the price differences?
The dissimilarities may be subtle but influence price rise. Some factors that can subtly change product price are materials, dimensions, components, and more.
Choose lowest rates
China offers cheap products but there is also the quality factor to consider seriously. China even manufactures world-class products. It is the buyer’s choice to choose an ideal supplier without product quality sacrifice. So, compare prices, specifications, and everything to get familiar with product pricing.
While deciding on offers never choose the lowest bidder. Get familiar with product manufacturers’ capability of maintaining product quality and competitive rates.
Speculation that suppliers understand
During China product sourcing, the language barrier is another factor to consider. Never assume that the manufacturer understands your product specifications clearly. They speak Basic English and you assume they understand because no questions are raised from the supplier’s side. They fear missing out on profits.
Common misunderstandings can be associated with the purpose of product use, packaging measurements, product unit measurements, as well as packaging and labeling needs.
You also need to share technical needs for quality control, which needs to be written, verified, and confirmed. Speculation is bad – communication is crucial!
Ignoring quality audit
Online suppliers post compelling product pictures on their websites. they may have a great factory, a sales rep that speaks English, and sample products matching your needs.
Don’t wait to receive compromised quality products because their production capabilities turned out to be over-promising.
You failed to perform a quality audit before placing a massive order. Understanding the supplier’s capacity is essential. With an audit, you can avoid quality issues, financial risks, scams, and production & shipping delays.
Failed to add intellectual property protection clause
Intellectual property issues can occur all around the world. It is essential to register your patent or trademark. There are chances that the supplier will display your goods on their website or tradeshows or in sample rooms.
Never forget to add a clause stating that your patented intellectual property cannot be sued for commercial or marketing purposes.
Shipping mode & cost dilemmas
China product sourcing involves shipping mode and cost. You need to consider the appropriate shipping mode. Logistic methods will make a huge difference in transit time and freight charges. For startups express courier is suitable, which is delivered within 5 business days.
For products weighing more than 250 kg can be dispatched via airfreight. It offers tight control of security and deadlines. Expect delivery within 10 days.
Unlike courier services, in air freight, you will be responsible for documentation and customs clearance. Sea freight is the cheapest but takes up to 60 days.
However, you can ship massive products that can reduce transportation costs. However, you will need to handle documentation and customs clearance.
Documentation errors can cause shipping delays
Shipping delays occur because of certain restrictions like holiday shipping or pandemic. Incorrect custom paperwork, documents, and declaration are also common errors in delayed shipping. Incorrect declaration of product value induces suspicion in customs.
Wrong product descriptions can cause categorization glitches, which impact incorrect license issuance or even rejection of license issuance.
Lack of import rights knowledge
- A US resident can use their social security number or the IRS number of their business.
- European citizens need to register an EORI number.
- Canadian business owners need to get a CRA number.
- Australia needs an import license.
- In Japan, declare to the Director General of Customs to obtain an import permit.
Besides gaining knowledge about import rights, it is essential to identify products that can be imported to your country. Some products are unsafe, banned, or don’t fulfill health standard protocols. If you choose them then expect penalties.
Sourcing products from China offers your business profitability in terms of low costs, high output, material accessibility, quick turnaround, and scalability. Ensure to avoid product sourcing errors!