When it comes to outsourcing manufacturing to China, there are a few things that companies need to be aware of. If you do your research, you can avoid making common mistakes in the production process when it comes to outsourced manufacturing. With that in mind, we've compiled seven tips to help your company achieve the best outcome when manufacturing in China.
7 Tips to Outsource Manufacturing to China
There’s no denying that outsourcing manufacturing to China has its pros and cons. Price is the enormous advantage, but if production doesn’t go to plan, it’s possible you could suffer financial consequences.
#1 Efficiency in Communication
While you might think the person you’re dealing with speaks excellent English and has great communication skills, it’s important to remember that they probably won’t be involved in the production process. Partnered with the fact that there are cultural differences between Australia and China, finding efficiency in communication can be a bumpy road. Your production instructions should be specific, but you'll want to make sure they are not too detailed. In doing this, you ensure that you are including the most important information and not overloading your contact with irrelevant details.
#2 Request a Sample Product From the Manufacturer
Product manufacturing in China can be fraught with problems, but many of these can be overcome by simply requesting a product sample from the manufacturer.
Requesting a product sample is important to ensure that you'll be happy with the quality of your products from a particular manufacturer. If this step is skipped or rushed, there's a high chance you won't be happy with the final product. As a result, you may feel inclined to request a refund. Receiving a refund can be difficult if you don't sign off on a sample before your products are manufactured, which increases production costs.
#3 Use Product Drawings Where Possible
When you outsource manufacturing to China, it's best to include product drawings rather than written descriptions where possible. In order to avoid miscommunication and reduce the risk of issues arising during production, having a visual aid will be much more helpful for your manufacturer than written instructions that may be difficult to comprehend. When labelling any drawings, include information about the materials or features you require and remember to keep it simple.
#4 Outsource to a Reputable Manufacturer
Dealing with a manufacturer in China isn’t the same as dealing with a manufacturer in Australia. Overseas customers have little protection from intellectual property theft in China. If a manufacturing company steals a product design or infringes a trademark or patent, it’s difficult to stop them.
Using a trusted manufacturer can reduce the risks. Speak to other companies who outsource their production to China and may use materials that are similar to yours. If you're not sure where to start, this is a great way to differentiate between reputable and disreputable manufacturers.
If you don’t know anyone who can give you a referral, speak to an import agent. Manufacturers value their relationships with import agents as this is how they receive leads and additional business from multiple clients. Manufacturers are less inclined to preserve their relationship with a small Australian business if there are bigger gains to be made from larger companies or orders through import agents.
#5 Be Prepared for High Minimum Order Quantity (MOQ)
Most Chinese manufacturers don’t want to deal with small orders, which is why many enforce a high minimum order quantity (MOQ). If you're a small business, it may be difficult to find a manufacturer who is willing to take on production for your order. You may want to consider increasing your order quantity and keeping the excess in your inventory so that it's easier to find a manufacturer.
#6 Build a Strong Relationship with Your Contact
The thought of saving thousands on business costs associated with manufacturing is a big incentive, but it's important to ensure you're going to be happy with both the product and the manufacturer. Although this may be time consuming, it's crucial to build a strong relationship with your manufacturing contacts and ensure you can comfortably request a product sample when you need one.
Save on Future Costs with the Right Import Agent
Choosing to outsource your communication with manufacturers can help you save on future costs. Import agents have plenty of contacts, experience with Chinese manufacturing facilities and the ability to get the job done faster. As a result, your savings are not only in finances, but also in time and effort.
#7 Treat Every Order Like it's Your First
Even if your first order goes smoothly and you're happy with both the quality and price of your products, it's important not to drop the ball. You can't assume that any subsequent orders will be fulfilled without any issues. The manufacturing company can decide to change their machinery, raw materials, unit price or even shut down without notice. Before each order, your business should provide details regarding materials and instructions for production, with both parties agreeing on the price.
If you choose to outsource your manufacturing to China, you should always be aware of the pros and cons. Finding the right supplier can take time, effort and money, though your journey to outsourcing production will more likely be a successful one.
For assistance with outsourcing manufacturing to China and maximising efficiency throughout the production process, call Vara Allied on 6115 0118 or contact us online.