How to choose a supplier in China?

1. How to choose a supplier in China?

Firstly, decide what products to sell. There are many variables that should be considered before deciding on a product to sell. To get inspiration, you can just go to a standard shopping mall or building materials market, visit an industry park and see what kind of factories there are.. Preferably go there!

2. Locate a supplier

Find a supplier through your network or just visit the local trade fairs and go hunting for the perfect products! In China the most famous fair to start is CANTON FAIR in Guangzhou (2 times a year). Or Yiwu fair for cheap commodities (in Yiwu town).

Please know that in China the areas are often producing the same items. There are cities in China, famous for LED (Shenzhen), Car parts (Taizhou), Stationary (Ningbo), etc. See below a map that is very interesting.

3. How do you know a factory is really a factory?

Factory name written at entrance on natural stone
They produce and promote often a narrow selection of items (on fair/showroom/catalog). They cannot make all items, but just a specific type or made of a specific material (wood factory, steel factory, stone factory, etc)
They are often Owner on Quality certificates (CE, UL, etc). Ask their Quality Certificates
Factory address on website or business card, separately mentioned if they have a different office address.
Factory addresses are NEVER on 30 floor of a building. China has many living and office towers, but factories are not located there… they are in lower buildings on industrial areas.
You will receive business card of factory staff when you visit them. If you are accompanied by a trading company, they won’t give you their business cards directly.
On Alibaba, you can find the category or business type: ‘Manufacturer’
4. China procurement

In China, the value of a contract becomes more and more important. Therefore we recommend you to work with a bilingual Purchase contract. Know that the Chinese language under Chinese law will always prevail! I always used this professional Purchase Sales Contract Chinese language, it’s a good example, and covers all important issues to discuss, such as:

Product description
Packaging
Terms
Price
Price effective duration
Order information
Performance and Assignment
Independent Contractor
Packaging and Packing
Quality Assurance
Inspection in factory
Acceptance of order
Rejection of Order
Warranty
Delivery Time
Delivery Location
Follow-Up services
Invoices and Payment
Changes
Termination
Indemnification
Confidentiality
Governing Law
Hope this information finds you well!

Written by: Peter Liu, Owner of dropshipping webshops (2008-present)

For most people the way they find a supplier in China is via one of the B2B sites such as Alibaba, Globalsources etc.

Choosing suppliers who are advertising on those sites can be difficult until you understand how those websites work.

Most people mistakenly believe that Status Badges such as Gold Supplier, or 6 Stars, or Premium Supplier etc., are a good way to choose, but that is not necessarily the case.

Status badges are bought to give buyers the impression that the seller is trustworthy, or reliable. They have not earned those badges.

In most cases verification procedures are very basic and do little more than to show that the business is registered and on the day of inspection they were located at the address they advertise.

Another matter of importance is that buyers should do some research before contacting a supplier, because often you cannot believe everything that you read in their listings. A very common lie published in supplier listings is the claim that they are manufacturers, when in fact they are traders.

If they lie to you about that, can you trust them about other things even if they have bought a high status badge?

to be continued ...

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