When do I need to visit the factory?

If you are thinking about sourcing in China, you will probably be wondering if and when you’ll need to stump up for a trip over there. Luckily, technology today makes it less necessary for you to do so. Here we outline three common reasons business owners make the trip, and whether or not they are worth it.

1. You are not sure that your factory exists

This is a common concern for new importers. Having established a conversation with a manufacturer via Alibaba or another similar forum, you begin a dialogue and they seem capable of your product. Before you know it, they’re asking for a deposit, but you’re just not sure…

Unfortunately, in this circumstance an hour-long factory tour is no guarantee. Some unscrupulous operators have been known to take unsuspecting manufacturers-to-be on tours of factories they have simply ‘borrowed’ for the day, staff and all. The reassured business owner transfers the deposit for production and the correspondent simply vanishes into thin air. Or, your contact may own a factory but take you on a tour of a better-looking factory, just to save face.

If you are concerned about the authenticity of your factory, it is far more reliable to conduct an official background check on them via a company that specializes in China business, by asking for references from current customers, or by obtaining verification of their manufacturing status through the manufacturer’s bank (using a verified translator). This is also a part of our due diligence with our clients here at CPG.

2. You want to see your samples

Another common situation we hear about is when a business owner organizes to travel to a new factory to inspect product samples and the factory that produced them. Unfortunately, these business owners frequently waste a lot of time and money on travel only to find out in one glance that the samples are unsatisfactory.

Save yourself the journey by insisting that your manufacturer send you detailed photographs of your product before they leave the factory. These photographs can also include the production process, if you request this in advance.  Once you approve the photographs, the factory can easily mail the samples to you for a fraction of the cost of airfare to China.

3. You have a product that you are already importing, and want to further the relationship with the manufacturer

This is one of the few situations in which we would agree that a visit to your factory makes sense. The concept of guanxi is an important one to know about when sourcing in China. Guanxi is the soft side of business – the social networks and influential relationships that help business and other dealings run smoothly.

In this situation, your visit might include a tour of the factory, a visit to the warehouse, meetings with your contacts there (expect to drink a lot of tea) and probably a meal or two with the factory management. While not a lot of business discussions happen over meals, if you follow up later via email with business questions or concerns you will almost certainly find that these are received more favorably than if you had sent them without visiting at all.

In short, if you plan on expanding your current souring program in China and anticipate working with this factory for a long time, a visit can be more than worth the time and money taken to get there.

Still unsure? Feel free to Contact Us for more advice before you book that flight.

 

By Nathalie De Clercq