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The Pros and Cons of Manufacturing in China
Today I’m going to show you the pros and cons of manufacturing in China that get:
The best product and services in China
Why should you manufacture in China?
The common mistake of sourcing in China
Lots of more.
Let’s dive right in.
Chapter #1 Manufacturing in China Basics
How big is the China manufacturing industry among the rest of the world?
In the last decades, a lot has changed in China — in all aspects of the industry. They open chances for international trade and the global market. In fact, “China world factory” was named after China. They became one of the leading countries in the world, beating the US.
It’s no surprise that they attract many business people and companies worldwide because they’re reliable and cater to their demands. For sure, most of them are sourcing a China manufacturing down to China suppliers. In addition, the percentage of China’s market rose by 30 in 2014. Most people mentioned above chose to branch out in China when starting.
Why is China manufacturing better than other countries?
As mentioned above, manufacturing in China has been at the top. Though it’s still your choice where you want the product process to happen, we suggest you choose China since it is a great option.
If you are still unconvinced as to why — here are some of the reasons you’re probably is intrigued to find.
China offers cheap pricing, whether it is for the product, production, or shipping cost. But it would be best to keep in mind that the inexpensive price offered by Chinese suppliers and manufacturers doesn’t always mean they’re poor quality. Besides, the low manufacturing cost is only one of the reasons why China is at the top but, it’s not only that. China has been best for high order quantity. They make large orders faster and output in a short amount of time. There are other factors you can note why China is the best option, like, the quality of service and global growth.
Manufacturing in China has benefits on its own, so keep on reading as we list all its pros below.
Why is China the best in producing products and services?
There’s no question that manufacturing in China has high-quality products. You can even see most products and goods made in China in supermarkets, malls, or even famous brands.
But what makes China the best among the rest?
China is not only the leading exporter and importer in the world, but also they are at the top of the manufacturing industry. There are many qualities and factors that we can say that identified China as the best. Some of those are; business ecosystem, its low-cost custom and taxes, low product prices, and cheap labor cost. China, as a whole, makes the industry and market thrive. And continuously improve the quality of their output to match the demands and needs of others.
Furthermore, China has one of the most advanced facilities and equipment. For sure, making your dream custom products, goods or creating new styles won’t be a problem.
Chapter #2 Why is it an excellent choice to manufacture in China?
China has been at the top in the past few years, and there’s no question about that. They have been proven effective in giving a practical and welcoming market open for all. Suppose you are a first-time entrepreneur or start-up business. In that case, manufacturing in China is one of your best options. Keep on reading to know more about why it is an ideal option to choose China as a place to produce your products and outputs.
China has high production and quality products
In the last 30 years, China has become one of the largest manufacturing industries in the world. As well, many Chinese suppliers have improved to adapt to the needs and demands of the westerns. There’s no question about how competitive the China manufacturing industry is — since even luxury items and famous brands choose to import products from China. In this representation, you can see how many trust China.
It was also discussed in Chapter 1 how sourcing products from China is; in terms of the quality and fast turn-around despite the large MOQ.
Most China manufacturing companies produce high-quality products because they have all the resources, equipment, and materials. You can get a premium output based on your needs; at the same time, it’s cost-effective. However, despite its product benefits, it is best to find the best China suppliers so everything can be efficient.
They have world-class facilities
China will not be on the top of the list as the China world factory without its high-end and advanced facilities. And as said, the last 30 years, China has continued to improve not only in different industries but also in its buildings and structures. They even built new ones to handle a large number of production.
The location of China is also a factor why they are capable of sustaining large volumes. China has vast shorelines, deep seaports, and river valleys. It’s not shocking that they have the seven busiest seaports globally. And it is easy for China to produce and ship products across different countries with these factors.
The manufacturing ecosystem in China
Before we dive deeper into the ecosystem of China, let’s first define its term.
A manufacturing system is a group of suppliers that supply materials and resources to make the final product come to life. It is essential not only to your China suppliers but also to you. For the reason of; they are a deciding factor if your product will be low-cost or not. It is also essential to make your products high-quality and high-efficiency production.
It is one of the factors you should look for when looking for Chinese suppliers and where you should produce your products. Besides, it’s not enough if you only base your requirements on low costs and then decide to build there.
Offers high minimum order
Most of the made-in-China wholesale suppliers have their standards and requirements. Some of these are; the set price, shipping cost, and the minimum order quantity (MOQ).
But one of the most important aspects among those is the order quantity. Why? Since most of these China suppliers are strict with these aspects, especially those with large facilities. For example, the minimum order quantity for each product is 500, and the prices vary according to the customization.
They set this quantity because of the large machinery and workers they have. And same as you, they also need to meet their needs. But if you were to compare their output, speed, and capacity to other factories, for sure, there is a big difference.
They have a better working environment
China has improved in recent years, not only in its buildings and structures but in their working conditions too. It is why you will rarely see a “sweatshop” or a made-in-China shop with poor working conditions exporting their products from different parts of the world. Precisely, cases like that will have a hard time exporting from countries like South East Asia, the USA, and Europe, since they need to meet a specific standard.
If you are hesitant about what you need to know and if the made-in-China site is approved or not, here are some things you need to remember.
- Their company principles.
- The facility safety.
- The worker’s working hours and labor cost.
- The company’s validity, compensation, and legit records.
You can find suppliers on China online websites
Chinese suppliers are everywhere. You can find them in China, on different third-party platforms, or you can look at their made-in-China websites. Indeed it is one of the advantages when manufacturing in China. But, let’s discuss the most accessible one, which is to look for them online.
First, made-in-China wholesale suppliers use third-party platforms like Alibaba, Made in China, and Global Sources. Through these platforms, they can list their products and the services they offer. It is convenient to them and the same way as you.
The next one would be to look at China websites of your suppliers. For sure, many of them has one. You can search for a made-in-China online shopping store or use keywords when searching, for example, bag + manufacturer; or best clothes manufacturer in China.
Tip: when you do this, make sure to have a China manufacturing companies list. It will make it easier to sort out and contact those companies you want to work with.
Chapter #3 6 Mistakes you should avoid when sourcing products from China
Are you one of those people who are unsure of what they will do? Or are you curious about how to deal with successful China suppliers? Well, you’ve come to the right place. In this chapter, we will be discussing the critical mistakes you should avoid when looking for China manufacturing companies or Chinese suppliers.
Failing to check if the China supplier is legit
You must first prepare yourself with knowledge before you do anything, like contacting a China supplier. At the same time, you need to have a list of requirements, especially when choosing a supplier.
The thing is, not all Chinese suppliers you’ll meet will be trustworthy and legit. And, it goes the same with any China product supplier in the world. So, the number 1 mistake you will probably make is not doing your homework — this is to research and look for qualified China suppliers.
There are tips you can do to do this, such as;
- Make sure to check if your chosen Chinese suppliers speak and communicate in Chinese. For the reason of, some of them would pretend. Also, make sure they have access to resources; they have connections and are credible in China.
- Create a made-in-China products list. It will be easy to see and check out which products’ specializes your China suppliers.
- Lastly, you can consult with your fellow importers or other customers of your suppliers and manufacturers. Their feedbacks and testimonies will back up their credibility.
These simple steps can minimize or cancel out the risk of you becoming victims of scams and any illegal activities.
Choosing a China supplier based on cost
Choosing a supplier based on the inexpensive cost of their products and services is a common mistake we encounter. In fact, it is the most devastating mistake most importers make. Well, it’s not startling that many, especially new buyers fall for this trap.
A very low price — that seems such impossible signals you to “run and avoid” them. It may be catchy in the eyes, but it won’t do good in the future. Almost always, cheap product prices equate to low quality and defective items. Also, most China suppliers will be unresponsive or, worse, a scam. We suggest you make a made-in-China products list, research the actual or retail price, or look for made-in-China wholesale reviews. You will have a price goal and an expected cost for negotiation by doing so.
Not hiring a China sourcing company
Sourcing companies is vital to ensure that the China manufacturing companies you want to work with are legit and trustworthy. Many importers and new buyers often overlook this since they don’t know what to do. But, when you work with a sourcing company, they will guide and help you, starting with making a list of your products, connecting you with a supplier, and shipping.
Not only that, sourcing companies like JUSTCHINAIT will help you verify every product and manage your product’s quality. They will ensure that it exceeds your demands and get you the best deals.
At JUSTCHINAIT, we make sure that we will be with you from the start because we value you as our customers. We have been in this industry for more than 16 years, so we know what is best for you — pricing, Chinese suppliers, lead times, and more! You can be sure that mistakes will not affect you, but instead, you have the best experience when doing business in China.
You need to avoid signing a deal without reviewing the contract
When new buyers and first-time importers get too excited, or rather, impatient, they make this mistake — signing a deal without entirely reading a contract. There are different reasons for these mistakes, such as being hooked on low prices, saving money, or not analyzing if the transaction is legit.
China suppliers often put off low prices to attract buyers and importers to deposit initial payments. After doing so, they drastically increase the costs — most of them lose the money deposits, lead times, and important equipment.
In this case, we suggest that you read on various China production issues and the latest trends on made in China online market. You can get knowledge, and you can equip yourself with knowledge on the actual prices, trusted manufacturers and suppliers, as well as the business you can partner with.
Not getting sample products first for review
There are different issues where your products will arrive at your door, and you will be disappointed because it’s not the one you expect. So, it would be best if you got a sample product to assess your supplier and manufacturer’s ability to provide you with the products you want. At the same time, you can evaluate their lead time, production time, product quality, and services.
For instance, you will also send them the mock-up sample and send them the prototype you want. However, not all the time will you get precisely what you want. It is because of the manufacturing process differences and methods. So, it is best to discuss everything with your supplier and manufacturer.
You wish that everything will be in your favor
Most of the time, problems and challenges arise when you choose to produce products in China. Although it doesn’t always happen, you still need to prepare yourself for many cases. As mentioned, manufacturing in the Chinese industry will be challenging — starting with sourcing your suppliers down to shipping your products.
You need to look for partners that will help and guide you as much as possible. It’s not an easy task, but everything will be smooth when you get a grasp of it. Though, you can entirely avoid the 100% chance of not getting anything wrong. However, there are ways you can do it like, choosing sourcing companies, being strict with your requirements, and more!
Chapter #4 Warning signs you should note when choosing a China supplier
Before you choose a China supplier(manufacturing in China), you should remember the go signals and the warning signs. Emphasizing these warning signs should be the first thing you should assess. In this way, you know which supplier to deal with and which ones to avoid.
They offer unreasonable product pricing
When a China supplier offers you a price or service that is somewhat lower than it should be, it is best to check. There are instances where these Chinese suppliers don’t understand your inquiry. Though it’s a one-million situation, still, it happens. At the same time, if this happens, you can expect that these suppliers don’t know how to quote. So it is best to check and communicate appropriately with them.
If your suppliers seldom update
According to Jacob Yount, you should not ignore this red flag; when your supplier or manufacturer suddenly goes from being communicative to missing in action (MIA). In fact, it should be something that should be alarmed of, mainly if you have decided to order large MOQ of China manufacturing products. When this happens, you should expect your supplier or manufacturer to prepare to deliver bad news. For example, “the products are done, but, during the process…” To avoid these, Yount made a list of what you should do before mass production.
They often avoid necessary discussions
Sometimes, Chinese suppliers who don’t ask questions and always avoid necessary discussions like the actual cost, lead time, and more is someone you should avoid. For the reason of — they do not want to work with you, and they are not serious about the project. In the end, you will not get an accurate quote and meet your best products. Plus, you will waste time and effort on nothing.
They don’t want to communicate properly
As Yount puts it, communication is important when choosing Chinese manufacturing companies. Often, if they don’t want to communicate with you, they will say, “we’ve never done this before,” or “it’s difficult to make.” It is a sign that your partnership with them won’t be successful and, worse, get nothing in return.
Continue to disregard your request
You have to remember that manufacturing in Chinese markets requires good communication. But, it’s a gem to meet a China supplier that is open to your talks and request. Though this rarely happens, it still happens.
There are instances where you keep on asking your suppliers and manufacturers about a specific request. Yet they keep ignoring you and instead change the topic — when this happens, you get the signal that they don’t want to talk with you or have no idea what to respond to you.
Chapter #5 Pros of Manufacturing in China
The China manufacturing industry is advantageous to most importers around the world. These benefits lower cost, fast production time, and more.
Manufacturing in China is cheaper compared to domestic ones
One of the benefits of manufacturing in China is the low cost. If you compare China’s production to your country or other countries, for sure, there would be a big difference. Although this low cost still depends on aspects such as the product, materials, MOQ—it won’t be as much. At the same time, you can negotiate rates with your supplier so both of you can arrive in a win-win situation.
There are various factors that make up the low-cost offered by China, such as low labor cost. Not only is it lower, but you won’t hire any worker or train someone to make your products. Because of this, China’s manufacturing products are lower.
They offer great services
If you have experience working with a manufacturer or supplier in your location, for once, you probably got declined or not entertained. The same scenario applies to small brands, start-ups, and lower MOQ. Sometimes, when you don’t influence or have a high following on social media, you won’t attract any manufacturers, especially in America.
The China manufacturing industry is open to all. They will engage and offer you fantastic services even if you’re a first-time importer. As long as you order in the minimum quantity, there won’t be a problem.
They have the fastest production time
Most of the time, factories in other countries have limits in capacity and production. But when it comes to Chinese manufacturing companies, it rarely happens. China’s industry was able to sustain this because of the low labor cost, high-end facilities, available resources, and more.
It is easy for market development
If you want to expand your business, China is the best place for that. It brings not only benefits but also to how wide the connections you can gain. China manufacturing products have a solid possibility for it be market and sell out in your country. At the same time, sourcing products from China not only focuses on the production process but can also help market them.
As mentioned, with low labor costs, most Chinese suppliers hire more workers, and they invest in equipment that will be valuable in their business. In this way, they can extend help and offers important benefit if you intend to sell your products internationally.
They produce custom manufacturing in China products (OEM and ODM)
The China manufacturing industry can cater to your needs, even if it’s OEM or ODM. Different manufacturers offer OEM, ODM, or both; you can find them as your source for your suppliers, manufacturers, and products.
Additionally, China manufacturing companies have the experience and means to meet your product demands. For sure, some of the products you need have been made by them, so they compare the resemblances to make your products.
It is easy to gain access to the Chinese market
In recent years, China markets(manufacturing in China) have risen dramatically as more and more global importers choose to make products in China. It is why, even if you are a first-time importer and buyer, Chinese markets are friendly for you. At the same time, it is easier for you to source suppliers and products in a faster, cost-effective, and diverse.
Made in China online websites
One of the benefits of sourcing China suppliers is that it is open for all, even for beginners. Most Chinese supplier uses websites so they can be identified in foreign countries. It is why you can search suppliers and products on the suppliers made in China website. Also, you can search them on third-party platforms like Alibaba, Made in China, Global Sources, and more. From there, you can get details of the products you want and need.
Chapter #6 Cons of Manufacturing in China
There are also disadvantages to working with Chinese suppliers like any other industry and supplier. It’s good to weigh to evaluate the pros and the cons. Here are some of the red flags you should expect when manufacturing in China.
High risks to Intellectual Property
In China, product design stealing and intellectual property theft are very common. You can also face trade secrets, improper policing, and more. Though the Chinese government has issued action like increasing the IP courts, you still need double safety. It is why you should be aware of the safety precautions and IP protection that you should note.
But to be completely safe, always hire a local lawyer or much better IP, lawyers. They are experts in the field of trademarks and patents.
Hard to find manufacturers in China
It’s no surprise that most China suppliers are traditional. They might have made a China website or used the internet to promote their product and services, yet, it’s pretty hard to find a legit and trustworthy one.
So, it is best to make a China manufacturing companies list or work with sourcing companies so it won’t take hours and hours looking for the perfect one.
There are huge minimum order quantities
Most Chinese suppliers offer their products at a low price. It is why they require a minimum order quantity for profits. Furthermore, it will be hard for you to negotiate if you are a first-time buyer, a start-up company, and can’t meet the amount set. So the option that you have is to look for another supplier who can meet your order quantity, but the catch is, it is higher than the rest.
Poor quality control
The “made in PRC products” has carried a bad meaning in the past. Most products from China were noted as poor quality and always fell apart. However, even with the improvement, there’s still a limitation that causes poor quality control on your products. For example, you will not know the production process and its quality until it is shipped to you.
Language and culture barrier
Most of the Chinese suppliers are not well-versed when it comes to English and vice versa. It is why most of the time, communication will be difficult, leading to ineffective transactions. So when you plan on doing business in China, you might as well learn basic Chinese and hire an interpreter to assist you.
As mentioned in poor quality control, there is always stigma regarding China production. It’s a reality that has been going for a few years now. These stigmas are; buyers always think it is low quality when products are made in China because they will pay less. However, that is not always the case.
It is why if you choose to create your products in China, you should prepare yourself for any criticism and negative comments. For sure, you will be getting some from time to time.
China has high logistics and shipping cost
You might save a lot of money when you manufacture in China; still, it doesn’t end there. There are different shipping methods like air and sea freight, postal, courier, and air express, but it is expensive. Depending on your product weight and size, it can add cost. Although you can reduce by choosing sea freight, minimizing your packaging, and ordering in bulk.
Chapter #7 FAQs
Where to find suppliers in China in line with your business goals
There are different ways where you can find the perfect China suppliers that you can work with. This article will discuss the two most pursued after, looking at the suppliers and manufacturers made in the China site and browsing the suppliers’ made in China website.
Look for the best manufacturing cities in China
According to Stewart, there are 7 top manufacturing cities that you should visit or look for.
- Hong Kong
Search for made in China website
China suppliers use websites and third-party platforms nowadays. If you don’t have the means to inspect and find one to go to China, you can search online using Google, yahoo search, and Bing.
What are the qualities to look for in China manufacturing companies?
It’s not easy to look for the right manufacturers that you can partner with, especially if it’s your first time. However, important qualities will guide you, so you will not fall into a difficult situation and scams.
- Look for different suppliers that make similar products.
- Look for manufacturers who have received positive feedback.
- Partner with suppliers who export to the USA.
What are the factors you need to include in your quotation?
It would be best to get a quotation once you put together your China manufacturing companies list. And once you have done that, then you can request a quote that includes the following:
- Minimum Order Quantity (MOQ).
- Production prices.
- Lead times.
- Sample product prices.
- Payment terms
What is the top made in China products (manufacturing in China)list you need to have?
Are you curious about the best products to source in China? Well, technically, China’s expertise made the best of the best products. However, among all of those in the following:
- Electrical and Electronic Products
- Phones, Computers, and Desktop
- Home and Furniture
- Clothing Products
- Equipment and Machinery
What are the best Exports and Imports of China?
As stated by Fordham of FoxBusiness, the top imports of China include broadcasting equipment, telephones and computers, office machines parts, and integrated circuits.
According to OEC, the top imports of China includes Crude petroleum ($204 billion), iron ore ($83.1 billion), petroleum gas ($47.8 billion), soybeans ($32.1 billion), and copper ore ($31.3 billion).