There is a clear trend that people working in supply chain management have to get used to: pretty much all products are getting more regulated over time. Even apparel is going to be hit hard by the upcoming EU Ecodesign for Sustainable Products Regulation! With that out of the way, some industries are clearly more regulated than others. Let's look at some of the most highly regulated industries that we may come across... … [Read more...]
Misguided Legal Advice Given to Startups in China: 8 Examples
We talk to hardware startup founders (on the way to bringing a new product into production) every week, and many of them have talked to a lawyer -- which is a good thing. Unfortunately, the legal advice given to startups is not always serving them well. (I am not trying to put lawyers down. Some international business lawyers are great and can think both as business people and as lawyers, but they are a small minority. The problem is, many hold a narrow perspective, don't know the limitations … [Read more...]
Don’t Let a Chinese Supplier Circumvent You: 5 Tips
Some risks and frustrations never go away... One of them is Chinese suppliers circumventing their customers, or selling to their customer's competitors, all the while using the product knowledge they gained... from their customers. Over the weekend, I stumbled upon a good old HBR article entitled When Your Contract Manufacturer Becomes Your Competitor. It came out in 2006, but the same trends are still at work! … [Read more...]
How To Fight Back Against Fake Goods In China Trade Shows
For all the talk about improvements in China's intellectual property protection, many importers are still facing very unethical behavior from their supplier base. And nowhere is it more apparent than in trade shows. The temptation for suppliers to show a customer's innovative product is often too strong. So, how to fight back against fake goods in China trade shows? … [Read more...]
What If Your Chinese Supplier Offers To Make Your Product in Vietnam?
We heard of several Chinese manufacturers that are opening a Vietnam factory, in order to serve their American customers better by avoiding Trump's tariffs. Sometimes that makes sense, and sometimes it doesn't... If one of your suppliers tell you about their ability to produce in Vietnam, what should you do? … [Read more...]
Shipping E-Cigarettes with Lithium Batteries by Air from China
By Fabien Gaussorgues With the sharp increase of shipments of electric & electronic devices working with a lithium battery and new rules that appeared recently when it comes to shipments, clients keep asking us about applicable regulations for shipping e-cigarettes. This guide covers the shipment of e-cigarettes, as an example, but it is mostly applicable to other small devices with lithium batteries (smart devices, IoT, Bluetooth speakers, and so forth). Note: on sofeast.com we … [Read more...]
How Does the VAT Rebate for Exports out of China work?
In most cases, importers don't need to worry about the way their supplier handles the VAT rebate. They are usually better off negotiating a price under the FOB incoterm and avoid worrying about the complex paperwork involved in getting a rebate on the VAT paid on components/materials. However, once they start looking deep in their supply chain, they can identify risks as well as opportunities for saving money. And they might notice that their supplier pockets a margin much higher than they … [Read more...]
Can Alibaba Really Avoid Counterfeit Goods?
I just read a good article in this week's Week In China on the topic of counterfeit goods. It starts by reminding us of the regular accusations of big brands against Alibaba. Last May, brands led by Michael Kors, Gucci and Tiffany resigned their International Anti-Counterfeiting Coalition memberships after the board proposed Alibaba for membership, forcing that body to back down. Alibaba's boss, Jack Ma, responded to this and tried to use it for a specific purpose. Ma says the criticism is … [Read more...]
The Risks of Paying Sourcing Contractors (Employees) in China
Dan Harris wrote a pretty good overview of the risks of paying an individual as a sourcing/QC employee in China. He relates a recent change he noticed. (On our side, we also heard that controls on incoming flows of money have gotten much tighter over the past 2 months.) China banks (owned by the Chinese government) are providing information to China’s tax authorities regarding account-holders who consistently receive money from foreign companies. China’s tax authorities are apparently going … [Read more...]
What Regulatory Standards Apply to Garments?
Note: all free coupons were used up. But we still got some coupons at 50% discount. If you import products from another country, you should be aware of the regulations that apply to those products. Chances are, your country's authorities will consider you as the manufacturer (since you have put that batch on the market) and will go after your company if they find some irregularities. Large companies know this well and have systems in place to ensure they are (mostly) covered. The problem is, … [Read more...]