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How To Design Your Purchasing Strategy From A Chinese Manufacturer?

As we all know, China is the biggest manufacturer for goods (anything and everything that you are in search of) in the world. Many organizations design products and give them to the importer in China to make them a reality. This often happens because not every organization has its manufacturing unit. 

If there is an organization with its manufacturing team, it is technically not possible for them to design and manufacture independently. This can be possible with a very few products. The cost of manufacturing in China is lower than in other countries worldwide; thereby, most enterprises hire companies in China for manufacturing. Purchasing from Chinese manufacturers hence becomes significant to grow business and gain profits within your set deadlines.

Four Different Situations of Purchasing Strategy!

The organization or company that needs to source from a Chinese manufacturer must have a purchasing strategy. Your strategy should follow all the rules of the organization or the terms should be tailored as per the business requirements. 

It should ensure a good quality product and fast delivery at relatively less cost from the manufacturer. Here are some for different situations.

1: Fast Delivery with Low Price

Many companies require promotional products. These products cost lower and need quick delivery, sometimes in a very short span. Quality is not an issue in such products. In such cases, the companies should follow the strategy to find a high production rate supplier. This will ensure quick delivery of the products at a relatively much lower price. The quality will not be as great, which is ok in these cases.

2: Good Quality is a Must 

Some companies require high-quality products. Quality is a priority for them. These products are expensive and do not want any compromise in quality. Aerospace products fall in this category. In this case, the company should follow the strategy to find a good manufacturer who can provide top-notch quality products. 

It is hard to find because manufacturers cannot maintain the same quality for the long run. Keeping a check on that is necessary. The price and delivery time of these products are often not an issue. 

3: Cost Matters

The purchasing strategy of these products is purely based on the cost, focusing not much on delivery and quality. Some products are all about price; for example, if the product is a basic cotton tee to sell to other companies, then that person or company must try to find the cheapest manufacturer. In such cases, lower cost with standard delivery and basic quality is fine.

4: Moderation is Important

Some companies and products lie in the middle of everything. These companies want a quality standard with the relative price in normal delivery time. Delay in shipments is not a great issue for them. The purchasing strategy of these companies aims at finding someone reliable. Strategically, they need to find stable suppliers and manufacturers to maintain reliability and price.

Choose a Purchasing Strategy that Fits the Best for Your Product!

The company needs to have a purchasing strategy according to its products. The amount of focus on each category, quality, cost, and delivery, decides the purchasing strategy. There are times when people find a good manufacturer but find difficulty finding a good Chinese supplier that can supply from the manufacturer in China. Negotiating and dealing with the Chinese supplier and sometimes manufacturer is not easy. Some tips can help you while negotiating.

  1. Paying a visit to the factory – Paying a visit to the factory by you or someone trustable is necessary. It is not always needed; the reality is the same as the supplier website. Sometimes suppliers don’t are manufacturers. But they can source out the best quality product from other manufacturers. There are cases where one cannot possibly visit China in person nor have someone there who will check the factory for them. In such times, several agents and companies can match the factory for you for $100. This will cost a little bit in starting but will save more in the longer run.
  2. A signed contract – A good contract includes vital aspects such as the price, payment terms, product specification, quality, delivery times, and more. A signed, well-drafted agreement can help you in any dispute with the supplier or manufacturer or in the case of any fraud. It is a legal document that can save you from much stress and financial loss. So always make sure to sign a contract before any purchase or order.
  3. Never-ending negotiation process – The Chinese manufacturer’s and suppliers’ negotiation is never-ending. Most of them follow according to the agreement just in the beginning. After that, they constantly remind you that they will increase the price. It would be best if you managed this smartly.
  4. Understand the whole structure of manufacturing your product – Always keep an eye on the supplier’s cost and commodity price. You can raise the price if the reasons are valid and checked. This will ensure that you can make the right decision when they ask to raise the prices. 
  5. Be consistent with quality check – While purchasing from China, always check the quality and monitor the product. Check the products after each delivery. Even if you are working with good suppliers, be consistent with the quality of the product.

Final Takeaway!

Developing a plan is a wholesome task in itself. The purchasing strategy and tips suggested in this article will be very helpful to investors and businesses that look forward to purchasing goods and services from Chinese manufacturers. Anyone can use them to design the best purchasing strategy for them from a Chinese manufacturer or supplier. The strategy results only state the success or failure of this strategy.