China is the hottest place to source various products from. If you are sourcing in China, there are a few mistakes that you need to avoid.

1). Lack of Effective Planning:

When choosing an agent for global sourcing services, it is essential to be methodical and steadfast from the very beginning. It is advisable to have a proper strategy before starting the procedure. For instance, you can begin by choosing the sourcing method, search for agents sourcing in China, find suppliers and so on.

2). Ambiguous Standards:

When choosing a supplier, you need to consider both the present and the potential requirements. As each order varies from the other, the maintenance of quality for future orders is not guaranteed. You can prepare an outline of your requirements like:

A. Where is the location of the supplier sourcing in China? How will this location affect your cost of production and shipping?

B. What is the rate of production capacity of the factory? A smaller manufacturing unit may not be able to supply such a huge order quantity and a big company, on the other hand, will not want to accept your small orders.

C. Is there a quality management process from where your products are getting manufactured?

D. What are your quality requirements and how are they implemented globally?

Are you getting quality products from the suppliers in the Chinan markets within your budget?

3). No Performance of Due Diligence:

This is perhaps the most essential step that cannot be overlooked when searching for vendors in China. Due diligence may include:

a. Requesting for a copy of all documents like a business license, registration, and certificate

b. Going through the online reviews

c. Visiting the supplier’s factory with the help of a factory inspector

4). Lack of Communication:

How can businesses be successful if you don’t know the required language? Communicating with the purveyors in their native language is regarded as a major advantage. Moreover, if you can understand the local culture, you are the clear winner for you can identify any adverse situations and envision misunderstandings that may lead to quality issues or conflicts.

On approaching agents for sourcing in China, they will help source in the best region for companies of all sizes, big or small. Many businesses are left crippled because they struggle to handle their production costs, labor sourcing, and raw material. Agents dedicated to sourcing in China will channel your business on the right path from the very beginning. By availing procurement or global sourcing services, your business will enjoy the benefit of cost reductions and sustainability. Hiring such services will help you to overcome various hurdles impeding your business and enhance its growth.

Thus, if you intend to opt for sourcing in China, remember the mistakes that you should avoid and last but not the least, have a global sourcing company like ElkSourcing, to channel your business.

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Elksourcing：Why Do You Need and How to Choose a Sourcing Agent?

Apr 17, 2021 Elksourcing, sourcing agent by 露露

There are various benefits of conducting procurement operations in China. The administrations given by Chinese sourcing agents can incorporate statistical surveying, choosing the correct provider, value arrangement, quality confirmation, quality control, crude materials pre-situating, delivery and coordination, pre-shipment review, traditions leeway, and so forth.

Reasons to Hire Procurement Services

Now that you know the factors that aid in sourcing company selection, here are some reasons to seek the help of procurement agents.

1. Sourcing Companies have Dedicated Production Facilities

Apple, the highest-grossing company in the world, is American. However, most of the production for their iPhones and iPads take place overseas. This is because sourcing companies have better facilities to dedicate to the production than Apple does in the USA.

2. Saving Labor Costs

Some countries have a higher payment standard to labors. For instance, producing a phone in the USA is generally far costlier than producing the same device in some Asian countries, such as Myanmar or China. Furthermore, overhead costs, such as electricity, rent and others can also account for a significant chunk of the costs. Using a procurement company can effectively reduce the overhead and labor costs without affecting the quality of the product.

3. Use of Local Resources

When the supply and production occur locally, businesses save a huge deal of money on importing and transportation. Moreover, apart from raw materials, foreign nations may have ready availability of skilled-labor, which you can utilize when hiring sourcing companies.

What to Look When You Choose Procurement Services

1. Tremendous local market: The Chinese household commercial center is basically the commercial center of the world and has been for a very long while now. Today, one can discover a huge number of completed merchandise, parts, segments, and crude materials. A China sourcing operator can distinguish the most ideal ways for your association. This is an incredible preferred position for western organizations, as they are in an ideal situation sourcing material for shoddy from China than produce them explicitly.

2. Capacity to give quality: Suppliers in China have been the greatest partners of thousands of western organizations. This incorporates prominent MNCs, who have adjusted China sourcing and acquirement as a fundamental piece of their creative work process. The fundamental inspiring component is that Chinese item sourcing providers measure up to anticipated quality principles, over and over.

3. Ideal exchange climate: China has various Free Trade Agreements with worldwide powerhouses in the west, which encourage simple and bother unhindered commerce relations. Aside from that, it is additionally a noticeable individual from the World Trade Organization. The quickly developing economy has limitlessly improved its generation abilities, and arrangements support remote speculations. Be that as it may, the incentive for cash item sourcing instruments it offers are as yet significant.

4. Productivity: Chinese providers are proficient! The Chinese sourcing agent reactions right away to the customers and doesn’t leave them out of the loop. They all work productively until the fulfillment of the customers.

5. Immense experience: Over the years, they have served different customers by offering sourcing administrations. Their experience has kept on developing significantly, making them the best-put organization to deal with your item sourcing.

6. Comprehensive administration: Their legitimate sourcing specialist is outfitted with all the imperative aptitudes to assist with all procedures that are identified with the buy of the correct business items. While guaranteeing a healthy administration for you, the nature of items conveyed all through the working relationship remains reliably preeminent.

Regardless of whether it is a short or long-time commitment with new businesses or set up organizations, the Chinese sourcing operators has the labor to guarantee quick item conveyance and no issue on your part.

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Elksourcing：What to Consider Before Choosing a Sourcing Company?

Apr 17, 2021 Elksourcing, sourcing company by 露露

Business firms can be hugely benefited if they opt for China procurement activities. They can take help from sourcing companies to channelize their procurement operations. Go with procurement operations in China if you want to minimize the production costs of your company’s products and services.

Choosing a good sourcing company is vital when you are looking for success. Here are some tips you must consider before choosing your sourcing agent for a business.

1. Knowledge

Every China sourcing company must possess intricate knowledge not only about sourcing the raw materials for the product but also about the specifications for the products in question. For instance, if your company produces laptops, the sourcing agent should understand the exact dimensions of the screen, along with the model of the processor and all other aspects of the device. Without said knowledge, sourced products may not be suitable for your company’s products.

Apart from the materials necessary, the sourcing company should know about the production process that your company follows. Otherwise, procuring the correct raw materials become greatly difficult.

2. Experience

An experienced sourcing company can be a boon to your business, while an inexperienced procurement agent can cause substantial damage to your company’s revenue and reputation. Always opt for a sourcing agency that knows what they are doing. Those lacking experience cannot secure the best suppliers, which results in your products suffering from poor quality. Additionally, by the time inexperienced procurement companies learn the ropes, it is probably already too late for your brand.

3. Location

Choose the perfect sourcing company based on its location to the industrial hub of that particular city or country. For instance, China sourcing companies located near Fujian, Zhejiang and Guangdong provinces are more likely to be effective when compared to companies located far away from these industrial clusters. Companies located farther off can be difficult to visit. Additionally, the price of transporting raw materials from the cluster regions to the procurement agency will also be high in such cases. Industrial clusters vary depending on the products you make.

4. Focus Markets

Different countries have varying terms, conditions and certifications when it comes to sourcing. Some product sourcing companies focus on just one market because they are familiar with the laws and regulations in that particular country. However, if you want to source materials from all over the world, you would need a procurement specialist possessing enough knowledge to handle the specific policies of several nations.

5. Background Check

Most people hire workers after a proper background check. Doing so with your procurement agent is also a wise move. You can look for more data about the company through LinkedIn and Facebook accounts for the firm. Apart from the experience, company goals and employee number, you can also come across reviews or recommendations from previous clients for the firm. Read the reviews carefully to know about the strengths and weaknesses of the procurement company. Going through online profiles and a background check can also help you verify whether the sourcing company has sufficient connection with suppliers that can help your business source the necessary materials.

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Elksourcing：Benefits of Sourcing in China

Apr 17, 2021 Elksourcing, sourcing by 露露

Nowadays, a large number of organizations resort to sourcing operations to minimize their production costs. When it comes to profits, international sourcing especially sourcing in China is more beneficial to organizations. The benefits of international sourcing activities come in the form of increased reliability, low labor costs, excellent quality of materials, scalability of resources, etc. The benefits of sourcing in China are listed as follows:

1. Reliability:

Every organization wants to attain stability in its sourcing operations. Now, the question is how can this stability be attained? If companies get access to the right suppliers, firms can attain stability in their operations. It also enhances the functionality of organizations. Most companies face difficulty in reaching out to the right suppliers. To combat this problem, organizations can seek the assistance of sourcing agencies. These agencies are aware of the economic and political scenario of the sourcing destination. They can make companies aware of these facts. Professional sourcing companies use their positive relationships with the suppliers to help organizations of all sorts. It is because of the sourcing agencies can get access to the appropriate suppliers.

2. Low-cost Labor:

This is another advantage of China procurement which is of paramount importance. If the labor costs are low, the production costs will also be lowered. Product sourcing companies want to take advantage of low-cost labor to the maximum. In this age of cut-throat market competition, lower prices of products and services will attract a large number of potential customers.

3. Availability of Raw Materials:

Business firms tend to choose a sourcing destination that abounds in natural resources of various types. Easy availability of resources also reduces the supply chain risks to a great extent. Cross-border sourcing activities also help organizations to build positive relationships with the suppliers. This is beneficial in the long-run. Moreover, if there are shortages of raw materials in the organization’s native country, sourcing operations play a great hand in minimizing these problems.

4. Quality of Products:

This is another benefit of China sourcing. Companies need to manufacture products that conform to global standards. Every organization wants to manufacture high-quality products at low costs. With the help of sourcing companies, both large and small-sized corporations can come up with reasonably good products. Moreover, if quality products are obtained, companies can focus more on their core activities.

5. Resource Skills:

Companies that lay stress on building a new product or upgrading an existing one consider procurement as a viable strategy to reap maximum benefits. Depending on the magnitude of the solutions, companies need to assemble a team of experienced professionals. When the project requirements are completed, the team can be dispersed. In this way, organizations can also reduce their costs.

6. Production Capacity:

If organizations resort to procurement operations, they can increase their production capacity by a significant margin. This is particularly helpful in times of increasing consumer demands. The highly-developed manufacturing infrastructure makes companies focus on their key operations.

7. Quality Workmanship:

Sourcing destinations generally tend to have emerging markets. It is predominantly because of sourcing activities, China emerged as the largest economy in the world. This also promotes quality workmanship in absolute terms. The workers are professional in their approach. As a result, companies can create quality products at low costs.

Sourcing in China holds huge benefits for business firms. Sourcing companies help organizations in streamlining their procurement strategies. Experts are of the view that sourcing operations will play a great hand in the success of an organization in the forthcoming days.

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Elksourcing：How to Find a Trustworthy Factory in China?

Apr 17, 2021 Elksourcing, factory by 露露

China has become the destined source for numerous products in the past couple of decades. It is, however, important that you know what you have to do for ensuring successful procurement from the nation. The first thing you need to do is to find a trustworthy factory in China.

Even though, it is necessary to reduce risks during sourcing, it is difficult to assess the integrity of a factory. Therefore, you need to be careful when making the decisions in the following ways.

1). Reducing risks with the help of a good sourcing agent

Conduct research and homework before short listing supplier companies to collaborate with. You can also take the help of a purchasing agent, which sees to it that the business relationship you forge through them lasts for a long time.

2). Facilities in the factory

Visit the factory and check the facilities available to the employees there and observe if they are in a working condition or not. The use of technology, cleanliness, standard of equipment should also be considered. Out of several factories, you can easily eliminate the ones that do not have much appeal.

3). Core competencies

The sourcing agent China focuses on the factories that make the type of products you want to sell or use similar components like you do, to manufacture your products. Such suppliers often work in the same industrial vertical and are aware of the market conditions related to the specific industry in your country. By partnering up with a supplier, which works in the vertical as you so, achieving success becomes easy.

4). Financial condition of factory

When you want to enter into a deal with a supplier, send your representatives to take a look at the factory to understand. They can inform you, if the factory is on the verge of a shut down. It is important that you search for a solid referral of the supplier.

5). Location

The more interior you go, the cheaper the labor gets. However, the cost of transportation becomes costly. If you have to procure in bulk from inland factories, it can be cheaper, but the transportation cost and the cost incurred in reaching important shipping routes can eat away the saved money.

6). Social responsibility

These days, most Chinese factories cater to policies of social responsibility. The agency makes sure that the supplier company adheres to the policies stated by the government. If you enter into a business relationship with a supplier that does not follow social responsibility policies, you might get flak from the authorities and activists.

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Elksourcing：How to Find Reliable Chinese Suppliers?

Apr 17, 2021 sourcing by 露露

The process of designing and developing a product idea into a finished product may seem daunting, but it can be achieved by partnering up with reliable suppliers. The followings are some tips about how to find reliable Chinese suppliers.

1). Connect with Manufacturers through Online Platforms

There are various established online platforms dedicated to bring together renowned and reliable Chinese manufacturers under one roof, for your convenience. The platforms allow you to filter your search and locate manufacturers and suppliers specializing in producing the product of your choice. You will get contact information of the manufacturers on such platforms, where you can directly talk and discuss your exact product requirements. It will be good to try and connect to more than one supplier, so that you can compare the quality of the products and the price offered. Also, prioritize your search on the basis of the quantity you require and the standards of production that you wish to be maintained by the manufacturer.

2). Attend Trade Shows

Trade shows are an excellent way to locate and connect, with Chinese suppliers. You might attend local trade shows in your own country or fly to China to attend any Chinese trade show and fair, where there are a large number of exhibitors displaying their products or services. This will give you an idea about the quality that you can expect and give you a chance to meet a number of suppliers, within a very short span of time. Although, if you are looking for bespoke manufacturing, trade shows will not help you much. Trade shows are a platform for suppliers to showcase their finished goods and sell those products to interested parties.

3). Engage the Services of a Sourcing Company

Locating and connecting, with Chinese manufacturers and suppliers can be a daunting task, especially if you have no connections and networks, whatsoever. By engaging a sourcing agent to conduct a thorough research on Chinese suppliers on your behalf, you can certainly ensure less burden and peace of mind. Procurement companies offer a fee-based service eliminating your need to personally fly down to China and save you a lot of hassle, time and money.

Sourcing companies usually have offices located in key sourcing destinations and China being one of the top low-cost country sourcing destinations, boasts professional sourcing agents to represent you. These professionals will help you find the most appropriate manufacturers and suppliers matching your specific product requirements, including quality, quantity, customization, price and delivery. The experts will even negotiate the terms of payment and other clauses, on the behalf of your company. Also, they will ensure that your products are dispatched and shipped, within the agreed upon time. Sourcing agents will be your ears and eyes in China and, therefore, considerably bring down the risks of sourcing from an oversea manufacturer.

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Elksourcing：Supplier from Selection to Management

Apr 17, 2021 Elksourcing, supplier by 露露

For global sourcing business, working with suitable suppliers is the key to success. The followings are some tips I’ve learned from my 20-year business in import & export industry.

1. Supplier selection

Choosing suppliers is crucial to your business. And categorizing your supply base is also vital to making the most of your available resources when managing those suppliers.

You would ideally want all of your suppliers to be performing at a high level. However, companies may have large supplier lists stretching into the thousands with some naturally more critical to quality than others. Selection should be the first priority for active supplier development management.

Importers and purchasers often consider various criteria for evaluating potential suppliers when beginning their search.

2. Developing an approved suppliers list

We often find that a company’s supply base invariably expands over time. Indeed, taking advantage of the “risk management” option of a “second source supply” is a very prudent business strategy.

However, it is occasionally a good practice to review your supply base and consolidate the number of suppliers you have to manage, which is an expense in itself.

Every business should make use of their approved supplier list and measure the performance of each with regard to cost, quality and delivery at a minimum. As mentioned above, listing your suppliers by category will make this a more efficient and value-added initiative.

3. Auditing suppliers

As with most audits, supplier audits represent a snapshot in time. Lots of information can be collected by this method, and it is indeed a mandatory requirement for most quality management systems (QMS). There are two main types of supplier audits:

(1) Questionnaire-type supplier audits

Most sourcing professionals are familiar with the questionnaire, or phone call audit. It’s an initial step that often saves time by helping you vet suppliers quickly.

Questionnaires are effective at collecting basic factual data about an organization, rather than determining how effective and efficient their processes are.

(2) On-site supplier audits

On-site auditing would, of course, provide you all of the information from a questionnaire-based audit and much more.

Though you can get information efficiently with a questionnaire-type audit, its main limitation is that such information is unverified. You’ll likely be relying on a sales representative from the supplier, who may simply be telling you what they think you want to hear. You’re also limited in the scope of information you can gather from a simple, questionnaire-type audit. An on-site supplier audit is typically the best way to get more in-depth and reliable information.

4. Measuring supplier performance

You can easily measure supplier performance if your systems support making the data readily available. Tracking supplier performance through a third-party sourcing partner. While some large purchasers invest in their own integrated enterprise resource planning (ERP) software, most small and mid-sized companies don’t. But a growing number of independent inspection and auditing firms offer access to ongoing reporting of product quality and supplier performance metrics.

These firms vary in the digital solutions they provide. Some simply offer cloud-based access to previous inspection or audit reports. While others offer a robust analytics dashboard, including a charted breakdown of quality defects by severity, SKU, product type and supplier. Clear and consolidated supplier performance data, whether through a third-party solution or your own digital ERP, can greatly enable supplier selection and continuous quality improvement.

5. Supplier development

Some larger companies will have a team of dedicated supplier quality engineers who spend most of their time at their own office, rather than at suppliers’ facilities. This defeats the purpose of supplier quality engineering. The engineer should spend most of his or her time at the suppliers’ facilities where they’ll have the greatest impact and influence on “right first time” quality. Smaller companies, in particular, need to approach this in a smart way and use all the data available at their disposal to make informed choices with regard to supplier status.

Even if you’re a small business, you must allocate time to visiting suppliers, reviewing the organizations’ requirements and clearly defining your company’s deliverables and expectations.Make sure you plan each visit well by developing an agenda in advance. If this is one of your key suppliers, you may want to stay a few days and go through the whole process with them: design, manufacturing, inspection, packaging, delivery, etc. Make the most of your visit, and you can come away with a good feeling that all parties have a clear understanding of what is required. Nothing beats spending time upfront with your suppliers to avoid problems later.

6. Supplier management

Once the development stage has matured to an acceptable level, it’s time to tailor on-going management to the needs of each supplier. Tracking ongoing supplier performance is key to understanding each supplier’s needs and any required corrective actions. For example, you may experience disruptions in shipments due to seasonal fluctuations in production capacity of a particular supplier. Tracking on-time delivery over time can help you take appropriate actions to avoid subsequent disruptions at that facility.

Historical quality reporting can similarly help you find and address any recurring product issues that occur at certain facilities. This transparency lends to better supplier management strategies. And through effectively managing your existing suppliers, you can make informed choices regarding the retention, removal or further development of each supplier to suit the needs and requirements of your business.

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Elksourcing：What Should You Check during Factory Visit?

Apr 17, 2021 Elksourcing, factory by 露露

After initial contact through internet, you are almost certain to choose a factory to make your products, and are about to place an order, now, it’s highly recommended for you to pay a personal visit to the factory. What should you check during factory visit? This article tells you the main areas you need to focus on.

1. Factory organization

Poor organization can cause many problems—from order delays to wasteful production processes, poor quality and even safety issues. But how do you know what a “good” factory looks like? All you need to remember is “5S”. 5S is a workplace organization method originating from Japan as part of the “just-in-time” manufacturing methodology. The English translation of each of the five S’s is:

(1) Sort: Sort through all items in a factory area and remove unnecessary tools, parts and instructions

(2) Set in order: Organize remaining items and arrange for easy use

(3) Shine: Clean the factory area on a regular basis

(4) Standardize: Schedule regular cleaning and maintenance

(5) Sustain: Train employees to make 5S a habit and monitor implementation

2. Factory capacity: Production planning board

A supplier will often tell you their production capacity exceeds your order quantity to convince you to place an order. You can often validate this claim for yourself while visiting the factory. A supplier with a lower capacity than promised might outsource production to sub-suppliers. Most factories must rely on sub-suppliers for different manufacturing inputs, like packaging, for example. But an overreliance on sub-suppliers can complicate your supply chain with the following:

(1) Increased production and shipping delays

(2) Misunderstandings regarding your quality requirements

(3) Limited social or other compliance oversight

A good factory takes steps to plan well for disruptions, whether they’re using sub-suppliers or not. Otherwise, they could constantly be playing catch up, especially around January or February when Lunar New Year affects manufacturing. Every factory should be prepared year-round for potential material or labor shortages and equipment failures. Rushing production is rarely a good idea. And confirming your supplier plans for disruptions helps you rest assured that quality won’t slip during busy seasons.

3. Factory working conditions and instructions

A social compliance audit is often necessary to thoroughly assess your supplier’s working conditions. But the average buyer can still often tell the difference between a safe and unsafe working environment through a few basic checks during a factory visit:

(1) Are workers wearing any required protective gear to prevent injuries?

(2) Are workshops properly ventilated where required?

(3) Can you spot any safety hazards? Puddles of water, unlabeled chemicals and poor lighting are all cause for concern.

4. Production equipment at the factory

Factories will generally cover the up-front cost of purchasing any necessary production equipment. But many factory owners don’t like to invest in the cost of regularly maintaining equipment.

Tools or machines that aren’t maintained or recalibrated periodically can lead to product defects, non-conforming products and inconsistent production runs.

Understanding what equipment your factory has on site can also help you set achievable quality standards based on your supplier’s available resources. You might be surprised to learn which production processes for your product are automated and which may require manual labor that can cause quality variance.

5. Warehouse and material inventory

The next factory area to check is your supplier’s warehouses and storage areas for raw materials and finished goods. Improper storage conditions can cause several issues both during and after production. Degraded raw materials used in mass production can cause quality issues in finished products, requiring extensive rework or replacement. A good factory usually conducts incoming inspections to verify raw materials before use in production. Proper storage of finished products before shipment is also important for preserving product quality. Temperature, lighting and humidity, for instance, can affect certain products and packaging materials.

Be sure to check the factory’s storage area for the following during your factory visit:

(1) Material storage time: A good factory should be able to provide records of incoming materials, including the date they were received.

(2) Cleanliness and orderliness of storage conditions: Materials can change or degrade if stored for long periods in improper conditions.

(3) Volume: Warehouse volume can indicate your factory’s capacity. You might even be able to see whether your supplier is working with your competitors by looking at carton labels.

6. Production samples

Many importers choose to plan a factory visit once the supplier has had time to manufacture a production sample. For example, you might plan your visit among other sourcing activities as follows:

(1) Identify and qualify a potential supplier

(2) Request quotation

(3) Place purchase order

(4) Ask factory to prepare sample

(5) Visit factory and review sample on site

Reviewing a product sample on site often speeds up a process that can otherwise take days or weeks.Importers based overseas must wait for the factory to ship the sample, then review it and provide feedback to the factory. These steps may need repeating several times before product requirements are fully understood and reflected in a “golden sample”. Reviewing samples on site lets you give direct feedback and point out any nonconformities immediately.

Elksourcing：Mistakes to Avoid When Sourcing in China