While many business owners are aware that China is a manufacturing powerhouse, they have never considered using China manufacturing for their own business. It comes to the surprise of many that even small and medium-sized businesses can benefit from taking advantage of the well-oiled machine that is the Chinese manufacturing industry.
Of course, understanding that China manufacturing could be an enormous benefit, and knowing how to make it a benefit, are two entirely different things. Most USA-based businesses have no idea how to find a manufacturer in China. For those without the knowledge, sourcing products from China can be an expensive, frustrating experience.
Fortunately for you, the team at Kanary has the inside scoop on the best ways to find a manufacturer in China, including factors to consider and questions to ask potential suppliers. By the end of this article, you'll have a solid idea of where to start looking (or you may decide a sourcing agent, like Kanary, would be a better fit.)
Step 1: Investigation
When considering how to find a manufacturer for your product, the most important (and work-intensive) step is investigation In order to find the best price and highest level of professionalism, you’ll need to look at as many candidates as possible for your production needs.
Ideally, you'll find 20-30 initial candidates before you start narrowing down choices, so don't be picky yet! Take note of any supplier that looks like they could remotely meet your manufacturing needs. You'll be taking a closer look at each of your potential options later in the process .
It should be noted that you need to speak directly to all candidates. That is the only way you’ll be able to gauge their knowledge, ability to meet your needs, level of professionalism, and flexibility of negotiation terms. This will be a lengthy process, but it is imperative you take the time to do it.
Can I Trust Alibaba Suppliers?
Alibaba is the world's largest B2B product supplier, but is Alibaba a legitimate site? The simple answer, yes, but let's explore further. It is based out of China and serves as one of the most popular places for businesses and manufacturers to connect in order to source goods from China. Businesses and consumers alike have relatively easy access to buy products or connect with suppliers.
For small-time operations (like drop-shipping or small product orders), Alibaba is an easy place to connect with potential suppliers. For medium to large-sized businesses looking to place large volume orders and make a permanent connection with a China-based supplier, you're likely to face enormous problems.
First, product descriptions can be very misleading. You may find a stock photo of a product that looks nothing like what the final product will actually be. Even if the product is accurately portrayed, pricing rarely is. Alibaba suppliers will regularly post a price publicly and increase it as soon as you begin negotiations with them.
Secondly, Alibaba retailers will present themselves as direct manufacturers when they're just branded middlemen. The whole point of trying to find your own supplier is to cut out the cost of 3rd parties between you and the manufacturer. Unfortunately, Alibaba is rife with middleman companies. We’ll explain this problem in more detail a bit later in this article.
Finally, if you need a custom product (especially a prototype), it's almost impossible to find a manufacturer that is going to readily meet your needs on Alibaba. Just like how you’re looking for a high-quality supplier, reputable suppliers are looking for real, high-quality buyers, but Alibaba most like will not be the best place to find them. Alibaba suppliers are looking for easy, quick sales so that they can work on the next customer and keep their money coming in.
If your company doesn’t have a physical presence in China, it can be difficult to establish a relationship with a high-quality supplier. It also makes it impossible to determine whether you’re working directly with a manufacturer or if you are working with a middleman. People who are on the ground, like Kanary, have the ability to convince these high-quality suppliers of your potential as a long-term customer, making it easier to get them to be as collaborative as possible.
Using a sourcing specialist to connect with a supplier for a custom product is ideal. For example, the Kanary Team has established, long-term relationships with suppliers, so it’s easy for us to find a high-quality partner to help manufacture a custom product or prototype. We also have a physical presence in China, which means we can guarantee direct manufacturing costs.
While it isn't impossible to find a manufacturing partner on Alibaba, we do not recommend it for inexperienced businesses. Especially for those who are looking to place regular, large orders with a China-based supply partner.
Step 2: Narrowing Down Choices
After you take the time and research to find a large pool of potential suppliers, the next step is to narrow down your choices. The best way to eliminate choices is to be prepared with a robust list of questions to ask a candidate. While you need to consider questions that are specific to your industry, these are general pieces of information to gather when eliminating potential choices:
● Does the supplier specialize in your industry?
● What are their current lead times and when can they start?
● What are their payment terms?
● How quickly do they respond to your questions?
Getting answers to these questions is paramount to finding a manufacturer that will be a successful, long-term partner for your sourcing needs. We'll discuss each of these specific questions below and why they are important:
Does the Manufacturer Specialize in Your Industry?
Not all manufacturers are able to produce all products. Usually, specific suppliers will have an industry of focus that guides what products they produce. For example, there may be a supplier that specializes in clothing, and while they are able to produce a large variety of different clothing, they wouldn’t be a good choice for supplying packaging or custom molds.
While the industry a supplier specializes in is usually apparent, you will still need to ask them this directly. You need to make sure that they can handle your specific product requirements.
Does the Supplier Have Connections with Raw Material or Assembly Manufacturers?
If your product is going through a multi-step manufacturing process, you need to make sure a potential candidate has established relationships with factories within the required supply chain. If they don't, your search will be greatly extended as you attempt to piece together a supply chain that includes raw material suppliers and assembly suppliers.
For example, let's say you want to supply branded packaging for your products. First, you need to buy raw material (cardboard), then you need to bring the material to a print facility for your preferred design or branding. For embossing or spot UV you would use a more specialized supplier that can keep the defect rate down to a minimum. Finally, the boxes will be sent to an assembly factory to cut the paper material and create the boxes.
The more complicated your product, the more complicated this supply chain becomes. For example, if you’re sourcing a rotary packaging machine, you’ll have multiple material suppliers (like plc control systems or certain kinds of metals for assembling the machine) that then need to ship the materials to an assembly manufacturer at the same time to put it all together.
The logistics of this process gets complicated quickly. If you only have a single part of this process secured, it doesn't get you much closer to placing an order and getting products shipped. Most established manufacturers will have a supply chain like this, but if they don't, it's an indication that you should continue looking.
What Is the Manufacturer's Price Point?
Expect to haggle and negotiate with any given manufacturing candidate. Even high-quality suppliers will go back and forth on the price (depending on your specific product needs), but poor suppliers will attempt to hide and misrepresent their price as much as possible. This is especially true for price listings on Alibaba.
Take the time to communicate your specific product needs and force the candidate to commit to a price. If the price is not within your budget, then you know to move on. If you get prices from numerous suppliers and they are all out of your budget, you may need to reconsider your product budget.
When Can the Supplier Begin Manufacturing and What Is the Lead Time?
It is vitally important that you ask a potential manufacturer when they can start and what their lead time is before you reveal your required timeframe. Many suppliers will lie about their lead time, knowing that once they are in the middle of manufacturing, it will be too late for you to stop and reconsider your order.
Getting accurate lead times is important for logistics planning, especially if you are using sea freight. Shipping containers need to be booked as soon as orders are placed, but if the lead time you're given is incorrect, you may miss your shipping date. This could end up causing months' worth of delays, all because a shady supplier lied about their lead time.
Even if you are speaking with reputable suppliers, getting an answer to this question early can help eliminate them as a choice. If a supplier is just too busy, you’ll know to move on. Regardless, just make sure you don't lead with your time frame before they disclose their current lead times.
Step 3: Avoid Red Flags
If a potential manufacturer can't provide a straightforward answer to the above questions, it should raise some serious red flags. The reason suppliers can't (or won't) answer these questions is because they have one (if not several) of the following characteristics that can be detrimental to sourcing products from China. They should be avoided at all costs.
The Manufacturer Is Being Dishonest
This is the most straightforward reason a potential supplier won't provide answers to the questions we discussed. They're simply being dishonest about their manufacturing capabilities and are hoping to take advantage of businesses that are inexperienced with sourcing from China.
It's also possible that you aren’t talking to a manufacturer at all. Instead, it could be a middleman that is pretending to be a manufacturer, giving you the illusion that you’re getting direct pricing. If this is the case, you end up paying a premium for them working as the go-between.
You’ll also face communication delays, since anything the real manufacturer needs to tell you (or anything you need to tell the manufacturer) has to go through the unnecessary middleman. You’ll end up with a frustrating line of communication and possibly major supply chain delays.
Getting tripped up with a dishonest manufacturer will cost you time and money (not to mention forcing you to restart the process of finding a manufacturer). If you suspect a supplier is being dishonest for any reason, drop them from consideration and continue shopping.
The Manufacturer Is Inexperienced
An inexperienced manufacturer is far less nefarious than a dishonest one, but your business may not have the time, money, or patience to work with a supplier that is still getting on its feet. This is particularly true if you also lack experience ordering from China, since this will make costly mistakes far more likely. In general, businesses making large volume orders should avoid manufacturers that appear inexperienced.
It should be noted that working with an inexperienced supplier is a potential way to establish a cost-effective, long-term relationship, which may be appealing to businesses that are willing to take the time and risks required to work with that kind of supplier. Don’t forget that the risks can get costly, and we generally don't recommend placing large orders with inexperienced suppliers.
The Manufacturer Does Not Speak English
Finally, the reason you may not be getting straightforward answers to your questions is because the supplier just doesn’t understand them. A language barrier is the most common roadblock when trying to successfully source products from China. The more complex your product needs are and the larger your order, the more problematic a language barrier becomes.
It may not be immediately apparent that there is a language barrier. For entry-level communication, the supplier may do fine (Google Translate can be convincing with basic, simple language). However, if you place an order with complex needs, only to find the supplier never understood what you needed, you've created a huge headache for yourself.
This is why it's important to ask specific, detailed questions about your product needs from the start. A significant language barrier will become apparent if the supplier struggles to answer questions that are specific to your business. We also encourage businesses to set up video calls, which is a very simple way to see how easily you can communicate with a supplier.
It is possible to work with a supplier that does not have a perfect mastery of English (or your specific first language), especially if you don't need custom products and your ordering needs are simple and straightforward. However, it will be difficult to establish a long-term business relationship with a supplier that struggles to communicate in your native language.
The Final Choice
After you've started with a pool of around 20 suppliers and narrowed them down to about three to five finalists, you'll make your final decision. If possible, suppliers may offer references from other businesses they have worked with in the past. You'll have to analyze the information you've gathered from the candidates and see which best fits your needs.
Kanary: Sourcing Specialist
Unless you already have an established, inside track for a supplier that is ideal for your business needs, finding a reputable supplier requires an enormous amount of time and effort. If you're looking to incorporate a China-based manufacturing partner into your business flow, Kanary can take the headache out of the searching process.
We already have established relationships with high-quality manufacturers in China across various industries, and we can leverage our expertise to find new suppliers for your niche needs. There will be no need to go through an extended period of trial and error, we guarantee that we'll find a supplier that is a perfect fit for your manufacturing needs the first time you place an order.
If you're a small to medium-sized business looking to place a large volume order from China, reach out to us for a free consultation!