Doing purchasing in China
Nowadays Chinese market is attractive for many wholesale buyers with its wide range of products and relatively low prices. But at the same time the level of risk to deal with professional scammers is also high. How to avoid risks while buying from China?
Not really useful internet
In the Chinese segment of the Internet there is a lack of English-version websites. You can try to place requests on Alibaba or similar resources. But mainly traders or retailers will response to you. Not directly factories. And for sure they can not offer best conditions to you which you are looking for (such as the lowest price etc.). To select the suppliers it’s a better choice to hire a local one who has experience to do searching in Chinese market.
Preliminary verification
Before placing the order it’s recommended to verify the detailed information about the supplier’s company (legal status, employees number, registered capital, allowed type of business etc.).
Mentioned above information you can find on official public resources, in local tax bureau, professional associations. It will help to protect your interests and avoid scammers. Just be ready that all information you can get will be in Chinese language.
Ask references
To understand the product’s quality and experience for export it will be worthwhile to ask the supplier about his customers. Usually factories are willing to share this information with the potential customer.
Analyze factory’s references. If the factory is working entirely with local customers, it means either the quality of the product can be not satisfactory or the absence of export experience can lead to significant problems for fulfillment of obligations under the contract.
Ask photos
Real photos of production site and warehouse can be also useful. Pay attention to the factory’s name on the photos. It can happen that the name will be unlike the company you are talking to, which means you are dealing with trader but not with the manufacturer directly.
Factory’s audit
One of the important parts is to investigate the facilities by yourself.
Not only production part but warehouses also matter.
Start with raw materials and components for production. Check warehouse, ask how the factory is controlling the quality of raw materials, check laboratory results of incoming inspection. Warehouse for ready goods: how the storage space is organized, the size of stock. Does the factory have separate storage for defective parts (only taking care about quality factories have it).
Ask about electricity, gas and labor costs. Analyzing raw materials and components price, production costs you can find out the cost of the final product.
Quality control
It’s better to check quality not when you receive the goods but before shipment. There are two parts of quality control: pre-shipment inspection in the factory and inspection in the port before loading into containers and shipment.
Inspection you can do by yourself, use third-part inspector or choose specialized surveyor organization with own laboratories such as SGS, Alex Stewart, Alfred H Knight, Inspectorate R.
The third-party inspection will take more costs but it is worth in order to get qualified product for your own Client.