Manufacturing is indisputably the largest industry in China. It’s steady growth and impressive capacity of suppliers, distributors and labor makes it one of the top producers of all kinds of products.
Due to the country’s focus on its manufacturing sector, Chinese factories are often the best options when it comes to speed, efficiency and quality of products. It’s therefore no surprise that the country produces 80% of the world’s air conditioners
, 70% of all cell phones and 60% of all shoes!
This being so, a number of business owners are now setting their sights on having their goods manufactured in China, and if you are one of them, here are a few things you need to know before starting:
Before starting to manufacture in China, you need to find a third party that can handle communication, negotiation and trading within the Chinese market. While this may increase your costs a bit, it can also make for an easier entry into the Chinese market.
While, recent innovations, such as of the platform Sourcify
, allow users to connect directly with factories and clients, the need for a native middlemen is still significant.
Building a good relationship with the manufacturer you’re going to be working with is essential. Chinese culture places a very strong emphasis on remaining cordial and respectful of all business partners and clients, and they expect the same from you.
It might also help to visit your factory in person to better understand the manufacturing process and build a stronger bond with your business partners.
While the language barrier is a hurdle easily surpassed as most Chinese companies prefer having at least one English-speaking member on board the sales representatives’ team, these members may often have a very basic level of English.
Whenever possible, conduct communication in written form, as any discrepancies and misunderstandings will be in writing in case you run into any problems later.
Before starting to manufacture in China, you might need to submit an upfront payment through wire transfer or Paypal to a Chinese bank account. Many Chinese manufacturers make this a requirement before beginning work, so it helps to know your money transfer options. Remember: wire transfer is less expensive but more risky, whereas Paypal may cost more but is less risky.
Expand your business in China
Get through the particulars and technicalities of starting a business in China with Business China
, your gateway to opening and owning a business in the country. From company registration processes to bypassing the various complexities that come with opening a new company in a different country, Business China helps you through the entire process of building and expanding your business.