Want to source from China? Remember to avoid these 7 mistakes!

Want to source from China? Remember to avoid these 7 mistakes!

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China has always been popular with global buyers due to its high cost-effective procurement. This is especially true under the influence of the epidemic. As of November 2021, China’s total import and export of goods was 35.39 trillion yuan, a year-on-year increase of 22%. Among them, export 19.58 trillion yuan, and the overall growth rate of trade is nearly three times the global level.

Do you also want to purchase products from here? If yes, this article is totally for you! Although sourcing from China is not very difficult, there are many potential risks in the process of cross-border sourcing. Let us help you avoid these problems and make your cross-border sourcing easier!

Mistakes when choosing a supplier

  1. Not confirming whether your supplier is a manufacturer or a trading company
    First of all, you need to know that there are two types of suppliers:
    Manufacturers, i.e. factories, they are the source of all the products in the market, and they are the suppliers who can offer you the products at the lowest price, therefore, they are the most ideal suppliers.
    Trading companies, middlemen working directly with manufacturers. Since English is not a common language in China, some manufacturers cannot communicate with foreign buyers directly, and can only sell goods to you through trading companies. The trading company will increase the unit price of the product, obtain profit from it, and increase your cost in disguise.
    At present, the most common purchasing method used by buyers from China is online purchasing. On the online purchasing platform, there are many Chinese trading companies who will pretend to be manufacturers to trade with you. If you do business with these trading companies, not only The cost increases, and it is very likely to be deceived.
    Therefore, it is necessary for you to confirm whether your supplier is a manufacturer or a trading company. The following methods can help you to confirm the identity of the supplier: ask the company’s business license, ask the supplier to take you to visit the factory online, etc.
    All legally operating enterprises in China will have a business license, and there is a “business scope” on the business license. This section will help you determine the supplier’s identity by telling you what categories the supplier legally operates in. But since the text used on the business license is in Mandarin, you may encounter some obstacles in reading it.
    Asking suppliers for factory photos or videos will help you identify the supplier, but not much. Because some trading companies will download factory photos or videos from the Internet and send these false information to you. Therefore, you’d better ask your supplier to take you online tours of their factories and equipment.
  2. Not confirming the supplier’s manufacturing strength
    The technical level of the manufacturer is related to the final product quality, and some manufacturers will exaggerate their technical level in order to obtain an order, so that you will end up with substandard products and be forced to suffer losses.
    Some suppliers, due to their small scale, may not be able to complete your order in a timely manner and with high quality and quantity, resulting in you eventually need to make secondary purchases, reducing production efficiency and also causing losses.
    Therefore, you must confirm the supplier’s manufacturing strength in advance. We recommend that you start from the following four aspects when communicating with suppliers to understand the overall manufacturing strength of suppliers: processing equipment, testing equipment, number of personnel, and site size.
    Processing equipment is the basis for suppliers to manufacture products. Whether they have advanced production equipment will greatly affect product quality and production efficiency.
    And testing equipment is also essential for some products, and whether the supporting facilities are perfect will reflect the professionalism of the supplier.
    The number of personnel and the size of the site can mainly help you to confirm whether the supplier can meet your mass production needs, and use this to determine the delivery time.

Error before order confirmation

  1. Focus on price, but not on quality
    There are many new entrepreneurs who always focus on product price when negotiating with suppliers. Cost is of course an important factor, but you also need to consider whether quality will be lost as a result. This is especially true for cross-border sourcing.
    If you only consider the price and not the cost, it is very likely that after paying a lot of money and time, the product cannot be sold due to quality problems, the inventory is overstocked, and you may lose a lot of money.
    So remember, when you’ve successfully negotiated the lowest price with your supplier, you have more important things to do: make sure the quality of your product is up to par.

The following 3 ways can help you ensure product quality is up to standard: create a detailed quality control checklist, request multiple samples, hire a third-party testing agency.

Create a very detailed quality control checklist where every detail of the product is detailed. This can effectively help you communicate with suppliers and ensure that the final product received is of acceptable quality.
Requesting multiple samples can solve the problems that many products may encounter before the final mass production, such as wrong product structure, rising raw material prices, etc., and also help you to confirm the strength of the supplier, so that you can judge whether you can communicate with the supplier. cooperate.
Hiring a third-party testing agency can help you further ensure product quality. Some suppliers may use false qualified inspection reports to deceive you, but the services of third-party inspection agencies have no relationship with you and suppliers, and can provide you with the most authentic product quality inspection reports.

  1. Not setting a suitable delivery date
    Failure to set an appropriate delivery period will have a great impact on your business, for example: the production efficiency will be affected due to the lack of key parts; , need to pay more production costs, resulting in lower profits and so on.
    Mature buyers are very aware of the importance of delivery time, so many buyers will communicate with suppliers in advance to coordinate a delivery time acceptable to both parties, and use this to require suppliers.

Errors when shipping goods

  1. Not checking paperwork
    In the process of cross-border procurement, many documents are required for customs declaration and customs clearance. Incorrect cargo information will lead to problems in customs declaration or customs clearance, thus prolonging the transportation time.
    While most suppliers do not experience this error, it can be cumbersome to deal with and can cost thousands of dollars if you do. Therefore, even if the possibility is not high, we still recommend that you check whether the documents for customs declaration and customs clearance are correct in advance.
  2. The customs declaration value is too low
    Since the entry of goods purchased across borders requires customs inspection, if the value of the goods you declare is too low, your goods may not be cleared through customs, detained by customs until finally returned, or after paying a large fee that is higher than the value of the goods, to bring the goods back to the country.
    We recommend that you truthfully declare the value of the product to avoid further expenses.
  3. Not paying attention to the shipping and packaging of the goods
    It is not only the fragile products that need to pay attention to the transportation packaging. You must know that the transportation process of cross-border procurement of goods is very long except for air transportation, and the goods are transferred frequently. If your goods are not well packaged, it is very likely that they will be transported during transportation. damaged in the process.
    Although you may be able to get compensation through shipping insurance, it is relatively uneconomical, and you may have to make a second purchase due to the high rate of damage.
    Therefore, we recommend that you choose a transport package that is safe enough and suitable for the product before the supplier ships it to reduce the damage rate.

Thanks for being here! Sincerely hope the above content can be helpful to you.

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    Want to source from China? Remember to avoid these 7 mistakes!

    China has always been popular with global buyers due to its high cost-effective procurement. This is…