When your start your business of importing from china, it is advisable to find a sourcing agent to help you, but it is not easy. You may not know how and where to find a good sourcing agent. How to sign a contract with the agent? How to pay the sourcing agent? How can you tell if they are trustworthy?
Here are some tips for selecting a sourcing agent:
1. Trust is everything
I think you would agree with me that to work with an agent, trust is important. I would rather use a reliable and trustworthy but mediocre agent than someone who is capable but not reliable. Ideally, you need someone who is competent and reliable.
How can you tell if your agent or representative in China is trustworthy? In many cases, first impressions can misguide you. You can do some online research to see if there are any comments and feedback about them. Give them some trial tasks to gauge their performance. You can generally understand their work ethic by working with them a few times.
2. Contract versus verbal commitment
Some buyers think a contract is not important, so they work with purchasing agents and suppliers on verbal commitment, binding by morality and virtue. My suggestion is to sign a contract with your sourcing agent no matter how good your personal relationship is with the agent. Ask the help of lawyer to draft and review the contract.
3. Sourcing companies versus sourcing agents
Sourcing offices normally have experience in more industries while sourcing agents often specialize in certain areas such as apparel and electronics. If your sourcing projects cover many industries, it is better to use a sourcing company. If you deal with a single industry, you could work with an individual agent.
Sourcing companies are normally legally incorporated companies, so if they breach the contract, you will have somewhere and someone to chase after.
A sourcing agent is often a one-man show. If bad things happen, he might disappear. So relatively speaking, sourcing companies are more reliable than agents.
4. Hire an expert, not a secretary
There are thousands of products global buyers are sourcing from China, and each product is different. Sometimes it takes years to understand the production mechanism of a specific product. A competent sourcing agent should be a product expert. If he does not know the product, he will not know how to do quality control, he will not know the costing, and cannot negotiate the price properly. He might not even know where to buy product.
That is why Li & Fung hires only sourcing experts with more than 10 years working experience in certain industries. The experience gives them the knowledge of quality control, price negotiation, product research and development. They can deliver a solution.
5. Communication is often a problem
First is the language. You should make sure your sourcing agent speaks your language well enough to understand your emails, and to draft and review an English contract. They should also be familiar with the products in your language (parameters, specification, parts and components, etc.).
You need a sourcing agent who is well prepared to hit the ground running. If you are looking to build a long-term relationship with your agent, ideally the agent should be proficient in speaking, as in many cases, email is slow, and you will need to call them to speed up the process.
The efficiency of communication is an issue to look at, especially when there is a time zone difference. Your agent should reply your emails promptly. Instant messengers can be used to speed up communication.
