Elksourcing：Why Online Sellers Choose Sourcing from China?

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Elksourcing：Why Online Sellers Choose Sourcing from China?

Apr 21, 2021 , by 露露

To source goods from China and resell online is proven successful for many entrepreneurs. Why more and more online sellers choose sourcing from China? There are many reasons, on top of them, the following reason are recognized by many business owners.

1) Cheap cost

Most of China products are available at a cheaper cost. If you source your product from a distributor or wholesaler in the USA, you are like to pay 2 or 3-time higher prices than sourcing from China. The cost savings are achieved via cheaper labor cost, faster production speed with moulds, and less marginal cost at high order QTY. Cheap cost can sharp your business’ competitiveness.

2) Supplier options

China is known as a manufacturing hub for its business ecosystem, labor pool and low production costs. Numerous industrial clusters are a distinctive feature of the Chinese economy. 

China has a long list of producers, thereby leaving you many choices. You have the flexibility to choose a producer whom you think is the best suitable for you. 

3) Easy exporting

When it comes to exporting goods, China follows a very streamlined process. Because of good infrastructure, vast labor supply, and strong government management, the logistics is very efficient. China has invested heavily in power and infrastructure; it has the most advanced ports and road system. 

4) Product quality

In the last decades, China gathered rich experiences on manufacturing and quality control, and more and more china factories have quality control system, the quality inspectors use quality control measures to assure that the product reaches the customer at desired quality. Most factories perform 100% inspection for their products, so more and more factories can meet the top-quality product specifications. 

Many China factories follow strict standards and regulations when it comes to quality, they focus on the quality of equipment, structures, materials and components. Also, the quality control services provided by 3rd party inspection company can help you in ensuring compliance with quality standards and mandatory regulation. 

5) Short lead time

Another good reason to source goods from China is that it needs less time in production. The productivity of their workforce is commendable, they have excellent logistics and infrastructure and they are also technologically advanced. More and more factories invest heavily in bigger machines, automatic production line, and new technologies.

As the laws are systematized in favor of exporting, they reduce the complexity of exporting from China.

China Sourcing Agent

Elksourcing：Qualifications Owned by Good Sourcing Agents in China

Apr 21, 2021 , by 露露

A product sourcing agent is the one who is responsible with the entire process of product importations from China to your country. Hiring a reliable product sourcing agent can help you with your overall business. Whether you are a first-timer or a frequent importer, hiring a product sourcing agent can be a good investment for your business. 

However, how to judge a good sourcing agent? Here are some qualifications commonly owned by good sourcing agents in China:

1. Excellent communication skills

Efficient and effective communication is crucial for any business. It is important to hire one you can rely on for his communication skills (both oral and written). The person must be able to properly communicate well with you in English and speak freely with your suppliers in Chinese. Hiring someone who clearly understands you and communicates with relative parties on behalf of can create your peace of mind.

While you can look for suppliers via online platform such as Alibaba, choosing the best among them in terms of quality and price can be confusing. By hiring a sourcing agent, you can find the suitable suppliers as the China sourcing agent clearly understands China manufacturing hubs, knows lots of good factories, and can establish a good working relationship with many suppliers. 

2. Good capability in quality control

A good sourcing agent knows the industry thoroughly, he fully understands your quality requirements and can effectively communicate your expectations with the suppliers. Also, the agent is well experienced in quality control, both in system and in operations. He specializes in your specific industry like electronics and consumer goods. The knowledge is very important to prevent potential issues, detect problems from an early stage. More importantly, he knows the compulsive requirements involved in importation to prevent noncompliance with the law in the future.

3. Experience in reducing importation risks

A reliable China sourcing agent should have years of experience in his field. These include extensive knowledge in production, documentation, and other rules and regulations in product importation from China to your markets. 

If you don’t have time to visit China to check out the products yourself, a reliable China sourcing agent can do the task. He will be primarily responsible with product inspections and dealing with production issues on-hand before delivering the finished good to you.

Following up on your orders in China can be tedious and stressful as well. A sourcing agent will help you ease that burden, so you can focus on your primary business activities.

China Sourcing Agent

Elksourcing：How to Evaluate a China Sourcing Company?

Apr 21, 2021 , by 露露

Imagine your shipment is delayed from China, your product has defects which reduce customer satisfaction or in the worst case require product recall. In order to avoid such risks, more and more importers realize the importance of partnering with a reliable sourcing company. This will ensure that you are able to well control production lead time, enhance your quality standards, reduce manufacturing cost, and improve your profit margin.

Finding the China sourcing company that you partner with in long term is one of the most important decisions for an importer, but it is an uneasy task. You may evaluate a sourcing company based on below factors:

1) Referrals

The best way to tell how a sourcing company will treat you is to determine how they have treated other companies. If others have had a good experience with them, you likely will as well. You depend greatly on your sourcing partner to supply quality products, so you don’t want to depend on trial and error before finding the right one. Receiving referrals from other companies will provide assurance that you have found the right sourcing company.

2) Communication 

The right global sourcing company will provide highly effective means of communicating important production information on a timely basis. All stakeholders should have access production updates and critical documents, including the customer, the global sourcing company, and the factory. This allows the customer to make informed decisions regarding their manufacturing project, and allows all parties to mitigate risks of lost time and money through improved project management.  

3) Product Quality

When partnering with a sourcing company, you need to be assured that they will provide quality products for your business. While it may be tempting to partner with the company that quotes the lowest price, that company may provide products that are of lesser quality, potentially hurting your production and your company’s reputation. The best option is to find a global sourcing company that offers sustainable value pricing coupled with a solid quality assurance process.

4) Types of Services

While some sourcing companies only do the bare minimum, others offer services that will provide great assistance to your business. The best option is to find a sourcing company that offers scalable services, so that you select and pay only for the services you need. For a global sourcing company these services may include sourcing & manufacturing management, onsite quality inspections, shipping and logistics management, warehousing, and engineering services.

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Elksourcing：Common Risks of Sourcing Products in China

Apr 21, 2021 , by 露露

One of the most common dilemmas of business start-ups is choosing the best products to sell. Aside from that, another challenge is finding the right supplier to get the products from. With a lot of suppliers all over the world, it can be hard to select a reliable and trustworthy one with whom you can have a great business relationship in the long run.

China is top of mind as far as product importation is concerned. Through the years, the mega-country has positioned itself as the world’s largest manufacturing hub. China is indeed a great country to source items to sell. However, there are several things you should consider before choosing the best items your business can sell. 

In this article, I’d like to share with you the common risks of sourcing products in China while embracing the opportunities that come with it. 

1. Lack of well-defined strategy

When sourcing products in China, you must have a well-defined sourcing strategy including locating the best supplier for your particular needs. Many companies fail to do the proper due diligence when sourcing for goods in China. As a result, they may not get the best deal in terms of price, quality, functionality, or timely delivery.

To avoid this mistake, you must have a methodical sourcing strategy. Successful sourcing strategies typically include:

Identifying suppliers.

Verifying suppliers.

Managing quality control.

Deciding which sourcing method, direct purchase or using a sourcing agent best fits your needs.

2. No standards for suppliers

Before searching for suppliers, it is important to have defined standards. Well-defined standards can determine whether sourcing efforts are successful. For example, a company might initially purchase a small order of electronic parts from a Chinese supplier and be happy with the product quality only to learn that delivery on larger follow-up orders would be delayed due to the supplier’s limited production capacity. If the company needs the parts delivered on time to capitalize on the holiday season sales rush, it runs the risk of losing profits, all because it did not eliminate potential suppliers with limited production capacity.

Due diligence is perhaps the most important step when sourcing in China, yet many companies fail to perform adequate due diligence and end up being scammed. Some fail to perform due diligence at all!

3. Lack of quality control

It is crucial to verify and assure the quality of your products. You need to hire a quality control company to check quality on behalf of you. The QC inspectors can personally visit your supplier’s factory, pull random samples, and check the safety, function and appearance. Also, when necessary, the QC inspectors can perform in-house testing, such as hi-pot test, endurance test, abuse test, and package test.

If quality control is missing, you face high risks of receiving defective products in bulk QTY. It’s always too late if problems are found by yourself at your warehouse, or even worse, found by the customers. So, it is very important to make sure all potential problems are reported before the products leave China, so corrective actions can be taken.

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Elksourcing：Quality Inspection for Sourcing Products from China

Apr 21, 2021 , by 露露

When it comes to sourcing products from China, quality inspection is one of the most important factors that should be always considered. Quality has become a critical success factor for many organizations. 

When you manufacture products in China, it is essential that you keep quality control factors in mind. Markets simply will not accept defective, unsafe and poor-quality products, regardless as to the price point and discounting. For this reason, it is important to identify the right company in order to manage quality control at the highest possible level. There are a number of key things about quality control, as shown in the following:

1) Quality and Compliance

It is important to distinguish between quality and compliance as both are key components of manufacturing processes. Quality is defined as services and products that are intended to deliver specific performance levels whilst compliance is all about meeting regulatory requirements. The organizational goals of most businesses center upon manufacturing competitive products that drive profitability, thus, ensuring that the business thrives in an environment of rising product development costs and globalization. In order to achieve these goals, factories need to ensure the creation of high quality, compliant products.

2) Manufacturing Traceability

The need for manufacturing traceability is increasing globally with commercial pressures growing to meet regulatory requirements. By mitigating the risk of product recalls, performing end-to-end quality control of processes and reducing manufacturing costs, organizations can easily handle and minimize risks across the entire supply chain. The key focus here is the ability to help manufacturers to easily identify the problem when it occurs, together with the associated details.

3) Inspection Result

When quality inspection companies inspect products, there are a number of potential outcomes. These include Pass, Fail, Hold. Pass as we all know that the product/service is fit for purpose. Fail is clearly the opposite of Pass. When the result is Fail, then the product has significant defects and cannot be shipped. 

When the inspection indicates Hold, this means that there is some form of issue such as the dimensions of master carton are different to that on the PO, and other issues which need to double checked by the client. It is essential that every customer receives only those products that meet their specifications.

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Elksourcing：What You Need to Know About Pre-Shipment Inspection?

Apr 21, 2021 , by 露露

Pre-shipment inspection is an integral aspect of quality control procedures for products purchased from overseas suppliers. The procedure presents manufacturers with the opportunity to rectify their products before they are shipped, thereby averting costly import risks. The inspection addresses areas such as safety, functionality, appearance, and dimensions of the products.

The aim of pre-shipment inspection is to ensure that the production of goods is in compliance with the principal specifications and purchase order. This is accomplished through an inspection wherein random samples of finished products are examined, typically when 100% of the order has been manufactured and at least 80% of the order has been packed. 

Pre-shipment inspection serves several purposes, including:

·      Examining the quality and quantity of products.

·      Scrutinizing products for defects.

·      Ensuring that products adhere to the safety requirements of the destination market.

·      Issuing inspection reports for importing customs clearance.

1) On-Site Inspection

The inspection of products is carried out at the manufacturing plant or warehouse. QC inspectors gauge products for defects. If they find discrepancies, they recommend that the product undergoes further investigation. Usually, if the products fail on-site inspection, they need to be reworked, and then a re-inspection will be arranged.

2) Quantity Check

Counting of the shipping cartons ascertains that the right quantity of products is shipped. Doing so also ensures that the required number of products reaches the correct destination. After the counting, the findings of the inspection are accepted by the supplier, the buyer, and the bank, and the payment for a letter of credit is initiated.  

The cartons or boxes are also examined to see if the packaging material used is safe for transportation, and whether or not the products have been labeled correctly.   

3) Random Selection of Samples 

Inspectors randomly select product samples for examination. All certified pre-shipment inspection services use the internationally recognized statistical sampling procedure ANSI/ASQC Z1.4. 

The acceptable number of imperfections in a batch before it is rejected is defined with an Acceptance Quality Limit (AQL). This value depends on the type of product being assessed. The primary aim, however, is to provide an impartial assessment. 

4) Check for Function and Appearance 

The quality control inspector examines the general function and appearance of the finished products from the samples. Any visible defects are identified and categorized as minor, major, or critical. 

This assessment is based on predetermined acceptable tolerance levels that have been agreed upon by the manufacturer and the supplier during the product development stage. 

5) Preparation of Inspection Report 

Upon the completion of pre-shipment inspection, a comprehensive report is prepared with the pass/fail result clearly mentioned along with the necessary details and key findings. The reports also include images that display all inspection points that visibly explain the discoveries.

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Elksourcing：Practical Ways to Find Good Chinese Suppliers

Apr 21, 2021 , by 露露

China is such a huge manufacturing base, for a product, there are hundreds or even thousands of suppliers. In reality, looking for good Chinese suppliers can be a tedious task.

During our sourcing practices, we have learned the following ways to find good Chinese suppliers and complete successful sourcing tasks. 

1. Search Engines and B2B Platforms

Internet is a huge virtual place where you can search for anything you need, including good Chinese suppliers. Whether it’s Google, Bing, Yahoo, or other search engines there is, these can surely help with your search for potential product suppliers.

There are also B2B sourcing platforms that can help you find Chinese suppliers, such as Alibaba, Global Sources, Made-in-China. You can filter the results so you can determine whether the supplier is a suitable one. 

2. Trade Shows

Another avenue to search for legitimate Chinese suppliers is through trade shows. Among popular supplier trade shows in China are the Canton Fair, which is held twice year in Guangzhou, and HKTDC Trade Fair held in Hong Kong twice a year. 

If you don’t have time or desire to travel to the other side of the world, there are trade shows in USA and Europe which you can attend. One example of trade fairs featuring Chinese suppliers is the International Consumer Electronics Show which is held in Las Vegas. 

3. Social Media

Many businesses have their own social media pages, so finding a supplier via social media seem to be a logical option. Among social media platforms you can find Chinese suppliers are LinkedIn and Facebook.

The above list is some of the best places to find Chinese product suppliers. While these sources are already proven and tested in terms of finding a supplier, it is still necessary to do extensive research and background checks so you will transact only with a reliable and trustworthy supplier.

4. Hire a sourcing agent.

A sourcing agent can help you a lot in dealing with Chinese suppliers, much more if the agent speaks their native language. More often than not, Chinese suppliers may increase the product costs if they learn they are dealing with a foreign business owner. That is why your sourcing agent should know the roundabouts of Chinese product sourcing and importation process so you can make the best decisions for your business.

Conclusion 

Finding a good Chinese supplier is a challenging task. It requires extensive research and background checks to ensure you only deal with a trustworthy source. Transacting with a legitimate supplier will help your business thrive in the long run.

China Sourcing Agent

Elksourcing：Why Sourcing Companies Are Better Than Direct Manufacturers?

Apr 21, 2021 , by 露露

For many importers especially small one, choosing whether to deal with a direct manufacturer or a sourcing company depends on the nature of the business, and the order quantity. 

Direct manufacturers offer more attractive costs, however, will require higher order quantity and may ask for better payment terms — such as 30% deposit at time of order, and 70% balance before shipment.

On the other hand, sourcing companies can help many importers. The following are some reasons:

1. They should strictly follow timeline

A dependable sourcing company should practice what it preaches. When your contact says the items will be delivered on Friday afternoon, it should be delivered on that exact day and time. Much better if earlier, but it should be advised in time.

More than the product cost, a good sourcing company should have a better understanding of the entire business process. Likewise, it should give importance to product quality, so you only get the best out of its price.

2. They understand their customers

Unlike manufacturing companies, most sourcing companies focus on customer satisfaction. Since they do not directly manufacture the products they sell, they make up to it by providing utmost client service. Communication is crucial for business, and this is usually sourcing companies are strong in – they have staff who have excellent English skills and can communicate with customers in professional, efficient, and effective way.

3. They are good at building relationships

They are basically experts in relationship building. On one hand, they usually deal with multiple factories in sourcing their products from, so they have good understanding about capability and capacity of factories. So, they know which products are best suitable for which factories, and when to place orders.

On the other hand, they also build a good relationship with their clients and satisfy their business needs. They understand their clients’ concerns, know the key areas their clients focus on, and can get know the ultimate needs of their clients. So, they know how to clearly work on behalf of their clients and get the maximum interests for their clients.

4. They are willing to go the extra mile

Many sourcing companies can take the extra task of sourcing other products aside from their current inventory. If you need additional business requirements such as dedicated labeling, sourcing companies can do that for you. Also, they can re-pack the goods, allocate them to different markets, and consolidate products from multiple suppliers.

5. They can offer better price

Sourcing companies know the local supply bases better, so they know where the best place is to source a specific product. For example, you may source metal products in Shenzhen, but usually not at the best price. If you go to the manufacturing hub of such products, such as Zhongshan, you can find the most competitive prices.

Most sourcing companies have a small office or warehouse spaces, unlike manufacturing companies. Hence, the former can only incur lower overhead costs than the latter. Also, building/space rental is cheap in China, so rental costs should not be a big deal for sourcing companies either.

6. They are ideal for small importers

Sourcing companies accept a smaller MOQ, which is a major concern for small importers. Likewise, they can also offer a wide variety of products you can choose to sell, each at affordable MOQ and fair price. For small importers, it usually does not make sense to try to work with direct manufacturers, as a very high MOQ will be required; even if the MOQ is acceptable, the manufacturers will not put smaller importers in priority, for both lead time and quality.