China is the world's leading supplier of goods, with a manufacturing sector that is the envy of the world. The country's factories can turn out just about anything, and at a fraction of the cost of factories in developed countries.
Despite this, doing business with Chinese suppliers can be difficult. The process is often opaque, and cultural differences can lead to misunderstandings. It is therefore important to have a reliable partner who can help you navigate the complex world of Chinese manufacturers.
A procurement agent can help your business navigate the complex process of finding and working with manufacturers to produce high-quality products. They will create a sourcing plan, identify suppliers, and manage the production process on your behalf. By outsourcing this work to a professional, you can save time and money while ensuring that your products meet your high standards.
In this post, we'll explore the various challenges importers face when sourcing directly from China and how working with a China sourcing agent can help. But first, let's take a look at who a procurement agent is.
Who is a procurement agent?
A procurement agent can be an individual or an organization who is responsible for the acquisition of goods and services for a company or organization, thus create value by sourcing. This typically includes negotiating contracts and prices, as well as maintaining supplier relationships.
A procurement agent must be able to assess the needs of their client and find the best suppliers to meet those needs. They must also be able to navigate the complex world of purchasing and be able to negotiate favourable terms for their client. Procurement agents must also be able to manage the flow of goods from suppliers and handle any potential problems that may arise. They are involved in all stages of the sourcing journey, right from negotiating prices, overseeing the selection of suppliers, and making sure that orders are fulfilled in a timely manner.
As an important part of any company, these agents help to keep costs down while ensuring that the organization has access to the supplies it needs.
Why do you need a procurement agent for sourcing from China?
The process of importing from China can be complex and overwhelming, especially for first-time importers.
It can be difficult to find a supplier that you can trust. For importers, it is vital to be sure that they are getting the best price and quality for their products.
Top challenges of sourcing from China
Here are some of the challenges of product sourcing from China that importers face:
Finding the right supplier
When it comes to importing products from China, there are a few key marketplaces that importers should be aware of. These marketplaces offer a variety of products and cater to different types of buyers. Here are the top B2B marketplaces and offline sources for importing products from China:
Alibaba - Alibaba is the world's largest online B2B marketplace. It offers a range of products, from clothes and electronics to industrial supplies and food products. Alibaba is ideal for exporters who are looking to sell to Chinese businesses.
The main disadvantage of Alibaba is that it is used by many businesses, including your competitors. If you find a successful product on Alibaba and get some sales traction on Amazon, your competitors can look up your supplier for that product. The advantage of importing from China is finding a supplier with high-quality products that do not advertise on Alibaba.
DHGate - DHgate is a platform that offers a wide variety of products, including those that are not commonly found on other e-commerce platforms. The site also has a strong focus on health and beauty products, sports gear, and fashion items. Sellers that use DHgate often note the lower minimum order quantities, although the prices on the site may not always be as competitive as those on Alibaba.
1688 - Another Alibaba platform, 1688, is a Chinese supplier and wholesaler directory. Unlike Alibaba, 1688 focuses on supplying Chinese-made products to the local market. The entire site is in Chinese, but with the help of Google Translate, you can often find some suppliers and products you couldn't find on Alibaba.
This means that you'll find low-priced but also generally low-quality products. This website is mostly focused on beauty products, fashion,
The process of finding a reliable supplier on a B2B marketplace can be daunting. The supplier should be screened carefully, which often means visiting their factory.
When looking for a supplier, it can be easy to be swayed by the promise of low prices or large order quantities. However, it is important to remember that these advantages often come at the cost of quality. Costs can change once production begins, so it is important to be aware of the supplier's production capacity. It is also crucial to ensure that they are able to meet your budget. If the supplier has never produced the product they are advertising on their site, there is a good chance that the quality of the product will be poor.
Trade fairs and offline markets
The Canton Fair - The trade convention is the largest one of its kind in China and is held twice a year. It includes nearly every industry that manufactures physical products. The convention is so large that it is divided into three phases:
Phase 1: Machinery, electronics, chemical products, and building materials.
Phase 2: Gifts, consumer goods, home decor.
Phase 3: Recreational products, textiles, shoes, office supplies, health, and medical products.
The representatives at the fair can speak business English, though some may not be affiliated with our company. You might get to know product details and order quantities only during your conversation with them.
The Canton Fair is a massive trade show. You can locate the booth and the list of traders on the website of the trade show in advance. Each year, the list of exhibitors tends to be the same. Do not expect to see innovation – companies that have come up with new designs may exhibit only prototypes and be on the lookout for distributors in place of OEMs.
Yiwu Market - The Yiwu Whole Market features around 40,000 shops. This market is open throughout the year and should be of interest to buyers looking for cheap textiles, accessories, shoes, and bags from Africa and countries in the Middle East. However, the products displayed in this market may not be aligned with American or European safety and quality standards. This is particularly true when it comes to medical devices, cosmetics, and toys.
Differentiating between suppliers and manufacturers
You will find different types of suppliers in China, including manufacturers, drop shippers, trading companies, and suppliers. A manufacturer is one who produces products for sale or resale. The company may design and produce the items in-house, or it may contract another business to do so.
The manufacturers are the first link in the supply chain and, as such, can offer very low prices on items. However, their minimum order quantities are often quite high.
The majority of the suppliers on B2B marketplaces are manufacturers, not suppliers. As a result, they generally do not have a website, and they do not speak English fluently. Orders must be paid through a wire transfer rather than with a credit card, and there is no guarantee you will receive the items you order.
Usually, manufacturers directly sell to wholesalers and liquidators.
Retailers find that manufacturers are often inaccessible when it comes to product sourcing. However, keep in mind that some smaller manufacturers will work directly with retailers. Wholesalers typically require you to buy large quantities that may come at a discounted price.
Here are some differentiators between manufacturers and trading companies:
· Trading companies have a narrower product range than manufacturers.
· Manufacturers will have their own in-house brands, which trading companies will not.
· Manufacturers will have a more significant physical presence with their own factories and R&D teams.
· Trading companies usually do not have their own salesforce.
· When it comes to company names, trading companies usually have names that are more readily recognized by buyers from across the world. The company name of manufacturers, on the other hand, typically includes the city they are based in.
Ensuring quality and timely delivery
If you are looking to sell a product that is technically complicated, finding a manufacturer who specializes in this niche is difficult. Even when you find the manufacturer, ensuring your quality specifications are met during production is an uphill task unless you can be physically present throughout the process.
In addition, importers face other difficulties in terms of:
· Price negotiation
· Conducting a thorough factory audit
· Building a long term relationship with the supplier
· Performing quality inspections
· Drawing up a foolproof contract
That's where a procurement agent comes in. A procurement agent is a professional who specializes in the sourcing and ordering of goods from China. They have established relationships with manufacturers and suppliers in China and know the ins and outs of the import process.
A procurement agent can help make the process easier and ensure that you get the products you need at the best price.
Here are the multiple advantages of working with a procurement agent for your China sourcing needs.
The top benefits of working with a China procurement agent
Connecting you with the right supplier in China - A sourcing agent will know where to look for qualified manufacturers and what questions to ask before signing a contract. They will work with you to create a shortlist of potential suppliers based on your criteria. They will then help you narrow down the list by visiting their facilities in person or via video conference.
This saves you time and effort and ensures that you will have a more pleasant experience overall.
Negotiating for the best price - If you are looking to buy in bulk, negotiating prices can be difficult because it is hard to compare prices between suppliers. For example, one supplier may offer lower prices for smaller quantities of a product but higher prices for larger quantities. If your supplier has a different MOQ for each product category, this can be very confusing.
The China procurement agent helps you understand if the quoted prices are fair and whether the rates are competitive. Knowing Mandarin and having an established network of suppliers in China enables procurement agents to negotiate and find the best deal for you.
Helping you get optimum quality - The quality of Chinese-made goods can fluctuate greatly. Procurement agents inspect samples and perform detailed research to ensure you're getting a high-quality product.
Conducting a meticulous factory audit - In order to make an informed decision about working with a Chinese manufacturer, it is necessary to be able to speak Mandarin. Procurement agents are fluent in the local language and are well versed in the way factories and suppliers operate in China. This gives them the edge in terms of being able to assess the production process as well as the company's management structure.
Ongoing follow-ups - When sourcing from a Chinese supplier, it is important to stay on top of your order and follow up with the supplier. Oftentimes, Chinese suppliers are hesitant to seek clarifications about technical specifications or share bad news. Having a China sourcing agent act as a liaison can help mitigate these issues.
Creating a foolproof contract - Price fluctuations, delays in fulfilling an order, and compromised quality are some issues that can crop up when sourcing from China. Your procurement agent helps you create a foolproof contract to protect your interests in case of a steep price increase or other disputes. The sourcing agent also specializes in the renegotiation of the contract if needed.
Contact us for your China procurement needs
China has many factories and a wide range of products to offer, but it can be difficult to find the right supplier and negotiate a good price.
If you need help sourcing products from China, contact our team at Maple Sourcing today. We have years of experience in the industry and can help you find the perfect supplier for your business. As a reliable and transparent sourcing company, we ensure that you get the best China sourcing experience.
Let us help you take your business to the next level!