When I meet someone who has recently started working with Chinese companies, I often urge them not to make any assumptions. One of the most common 'discoveries' buyers make is... that they haven't been working with a factory directly when they thought they were. … [Read more...]
Why Your Ground Agent in China is NOT Helping Cut Costs
From time to time, I hear from a company that works with a ground agent in China, and they basically tell me two things: The agent did a relatively good job lining up suppliers, communicating requirements, and generally ironing out most issues. (That makes sense -- otherwise, the importer switches to another agent or to another approach.) After the initial burst, the agent feels entitled to a commission of X% and is resting on her laurels, not challenging factories, not looking for new … [Read more...]
Why First-Time Buyers Fall for Trading Companies in China
Let's say you are looking for a supplier in China to make your innovative product. You know that traditional sourcing agents are not the solution -- they simply don't have the ability to assist you with design reviews, engineering work, certifications, and so on. And you can't justify setting up a company in China and hiring local staff -- that's a lot of extra expense. So, the choice often ends up being between a trading company (which will be your supplier, even though they don't do … [Read more...]
Sourcing from China 101, Part 1: Do You Need a Sourcing Agent?
A few years ago I wrote a 15-part course that was sent automatically, lesson by lesson, to interested readers. These days, such autoresponders are a thing of the past and we will switch to something different. But, rather than ditching these courses, I will update them a bit and publish them, one at a time. They are still quite relevant to new buyers. --- If you are new to sourcing from China, your first decision will be: should I manage this by myself? If your team can’t dedicate 1-3 … [Read more...]
Chinese trading companies and their dirty little secrets
Before you read this post, I have to emphasize that some trading companies here in China--including Hong Kong--truly create value for their customers. What I wrote below does not apply to all intermediaries. But I observed it so many times that I believe it is true in 80%+ of cases. … [Read more...]