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How to lower my exposure to risk when sourcing?

Posted: 2013-11-29

Full Question

We have to make a 30% down payment to some suppliers in China against orders. How can it be secured and how to guarantee delivery of goods?

Answer

The answer to your question has two parts.

  • How to find the right supplier in the first place, and to ensure that it is a legit seller and not a scam, or an under-performing vendor?
  • After the order has been placed, how to verify that the goods shipped are up to your quality standards?


Video 1: Finding Suppliers

Video 2: Evaluating Suppliers

Video 4: Project Management and Quality Control

Video 8: Avoiding Scams

Essential sourcing skills: Supplier Verification


If you only take away one thing from the above resources -make sure you link the supplier’s performance to your payments. In other words, don’t make the final payments until the terms of the contract (quality, delivery, etc.) have been completed. And be sure to verify quality with an independent party before the goods ship out of China.

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