- Published on Friday, 24 June 2011 10:00
by Renaud Anjoran in 'Quality Inspection Blog'
Every year, thousands of inexperienced buyers are coming to China to find a supplier and launch production.
However, getting a perfect preproduction sample is not enough. Do you know
who is going to make your products, and in which conditions?
Here are the steps to follow, if you want to launch production in China and avoid the major pitfalls:
- Visit a factory (and write its address down), or get it audited by a third-party inspection firm.
- If you have serious doubts about your supplier's relationship with this factory, pay for a background check on your supplier's company. You might discover that you are dealing with a middleman.
- Get a written confirmation that 100 percent of production will take place there.
- If you feel particularly worried about this point, work with a specialized lawyer to draft an OEM agreement that includes this term and that can be enforced in China.
- Keep a preproduction sample that you approved, and write your requirements about the products, their labeling, and their packaging. Be as precise as possible. Do not forget tests that simulate your product's intended use.
- Tell the supplier that production might be inspected at different times, and that they will pay for reinspection(s) if an inspection fails. Write it on your purchase order.
- The factory might be tempted to use substandard (and cheaper) components. This can be checked just before production is launched. If you cannot go there yourself, send a third-party inspector.
- Check production during production. The earlier the better, but you also want to make sure you see a few finished products. At that point you will know where production takes place.
- Inspect the products again a few days before they leave the factory, preferably when at least 80 percent or the order quantity is packed. This way you can count them and you can draw samples at random.
- If you notice quality issues, communicate about the corrective actions to follow. Then check quality again.
- Do not pay in full until you are sure the products are fine. For a first order with a new supplier, keep the total amount low or pay by letter of credit.
- Anticipate a few weeks of delays. Do not rush production, ever.
Buyers who follow the above recommendations will reduce their sourcing risks by more than 90 percent. It will cost some money. But who can take the risk of receiving a whole shipment of unsellable goods, with no way to send it back or get a refund?
PS: for an in-depth analysis of the mistakes made by an inexperienced importer, have a look at Seconds from Sourcing Disaster. It is written by Mike Bellamy on his Another China Blog. He is going to write regularly on this topic, and I am looking forward to reading his next articles!