I have talked to importers who can only purchase their products in China, and other buyers who can’t find anything they need in China. How is that possible?.
Actually the situation is very different depending on the industry. I tried to provide a rough classification below.
Some product categories are very difficult to purchase outside of China:
- DIY and power tools
- Products (toys, sport gear…) integrating electronics
- Low-cost hard goods, especially in plastics
- Low-cost molds and industrial tooling
Some product categories can only be purchased in China if the importer needs hundreds of thousands of pieces in a short amount of time
- Consumer electronics
- Complex garments (jackets, certain bras…)
Some product categories can only be purchased in China if the importer needs a high mix of products and small production batches at a low price:
- Any product that relies on a low-automation and high-flexibility process: manual welding, cheap plastic injection molds…
More and more food products from China are exported all over the world at very low prices:
Some products are better sourced out of China:
- Some textile products (e.g. simple garments made in Bangladesh, certain embroideries made in India…)
- Some products based on specific materials (e.g. gloves out of latex, sourced in Malaysia)
- Equipment that requires high accuracy and long life cycle (e.g. flow meters for gas/oil, sourced in Japan.
Overall, my feeling is that if we remove textile from the equation, other low-cost Asian countries are positioned on niches “between the elephant’s feet”.
What do you think?