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8 Reasons It Pays to Visit Your Supplier Before Buying From China!

Thursday, 13th June 2013

 

My name is Adam Gilbourne and I’ve been importing from China for more than 7 years. Based on observations across thousands of orders here’s 8 reasons why it pays to visit the factory.

1. You can find out if the product you want to buy is really their “core business”

Many factories quote on product they haven’t made before. And don’t intend making. Does this surprise you?

A hidden secret is most factories trade in product. They won’t tell you this. Enthusiastic sales people will try to get sales however possible. Visiting the factory will reveal what they currently produce.

Without visiting their operations on the ground you don’t know if they are:-

-       a trading company pretending to be a manufacturer

-       a manufacturer trading in product

-       a manufacturer highly experienced at producing exactly what you want!

There are several reasons you want to avoid having product outsourced to an unknown supplier.

Firstly, you cannot monitor or control quality as you don’t know where it’s being made.

Secondly, communication is going through multiple sources; the factory sales person, the second factory sales person; and finally to the technical workers. Lost in translation is likely.

If the manufacturer is not familiar with your product and how to make it, you’ll end up paying for their “education” in creating your product. This is not a situation you want to be in!

2. You can assess the general standard of the people, the sales staff, the managers the, workers.

Do the workers wear uniforms? Does the factory have signs all over saying “Quality is Number One”? Do they have facilities for the workers; basketball courts, canteen etc? Are they busy and currently producing product? Is the warehouse full of materials for upcoming orders? If not, why not? How long have the workers been there? How skilled are they? What is their level of workmanship?

I have visited several factories which produce product for Ikea. The workers are in uniforms, the factories are always remarkably clean and well organised. Throughout these factories are massive boards hanging from the ceiling with quotes from the likes of Bill Gates, Edward Deming or big signs showing current defect rates and the targeted defect rates, as in “98% defect free”.

These factories often have multiple production lines and advanced machinery imported from all over the world. They have quality control inspectors at the end of each production line actively removing defects. They don’t leave raw materials or customer’s final product sitting outside exposed to the elements (many suppliers do!).

Without visiting the factory you wouldn’t know any of this.

3. Competitive Research: Who do they currently produce for?

Many factories claim: “we produce for such and such famous brand”. But is this true? Much of the time it’s just a sales pitch – or a greatly exaggerated statement (perhaps they were asked to quote on product by this famous company, or produced one order for them).

When visiting a factory you can see the cartons of other customer’s product and can confirm who they are currently supplying. You will likely know many of the competitor’s products and can research them online.

Online sellers usually have detailed online feedback. This is the most direct verdict on the company’s product you will get.

4. How Important a Customer Are You to the Factory?

You can judge if your orders are too small or too large for this factory. There’s nothing worse than dealing with a factory who doesn’t care for you business, with disinterested sales and production staff.

Many larger factories will openly tell you they subcontract smaller orders to other factories – because they are too busy.

Currently we work with many smaller factories, selling around $5m of product per year. Our purchases make up 10-20% of their sales volume. Do they listen to us and respond quickly to our demands? You bet they do. When Chinese New Year comes around and they have orders banked up – who do you think is first in the queue to get product out?

5. Is the factory undergoing an expansion, or buying new equipment?

In some ways an expansion is good. It suggests business is growing which usually means the product is of good enough quality for their customers.

However, there are ugly side effects. Production delays and new workers!

For many products the workers skill makes a big difference. A factory expansion means they are going to hire new workers. And if the workers are inexperienced and not well trained this means more defects and poor quality workmanship.

It can also mean delays in getting orders out – at least short term. They are expanding for a reason. And many factories are expanding because they cannot keep up with current orders!

6. Production Methods and Production Quality

How does the factory produce the product? For example, are the products handmade? Or do they use CNC machines? Do they have advanced equipment suitable to make to your product requirements? What is their actual production method?

Does the factory routinely leave raw materials outside, unprotected to be rained on? Does the factory have well organized areas to stock materials?

Do they have in house labs or testing equipment? Are they using these labs to test raw materials that come in? Or do they have no way to check the raw materials they buy? Can they show you the processes they take to stop quality issues? Do they have quality inspectors at the end of production lines? Can you see evidence they are actually taking out defective product?

Does the production run quality match the sample quality you have received? Many factories can make an excellent hand sample, but cannot make your product nearly as well in mass production.

7. Packaging – is it suitable?

In my opinion, poor packaging accounts for more defects than anything else. And it’s easy to overlook.

By visiting you can see the standard packaging the supplier uses. Do they package the items well? Do you require better packaging? Factories won’t tell you their standard cardboard is the cheapest possible. You will have to ask for upgrades.

In many products the difference between a 1% defect rate and 5% defect rate is the packaging used.

Check the packaging used, find out the grade of cardboard and ask what levels of packaging they can provide if you pay more.

8. Face to face interaction; problem solving

Nothing beats sitting down with the factory owner and technical workers/engineers. They see you face to face. They know you have travelled a long way to be there. They know you must be reasonably serious.

After all, factories receive a lot of emails from low quality customers asking for pricing, pricing and more pricing!

Sometimes factories just don’t understand what you want done. They just don’t get it. Sometimes there’s a big communication gap between the sales person and the technical person.

Sitting down and going through details with their full attention, not just with the sales person – but with an engineer, designer or technical person can be crucial to get things moving along quickly.

Key points: it’s not only visiting factories which matters. It’s having a trained eye and experience to ask the right questions which counts. As this ensures you’ll build a better picture of the supplier’s competence.

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