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What questions should a first-time buyer ask before placing orders with a China manufacturer?

Posted: 2011-11-18

Full Question

Quick question. I am about to place an order with a manufacturing company in China for the first time. They have been communicating very well with me, so I feel comfortable with them in that regard. However, since it is my first time, I am nervous. Can you please let me know what concerns or questions I might ask them before I place the order?

Answer

Thanks for your questions. While it is good to have a comfortable feeling based on e-mail and perhaps a face-to-face at a trade show, I'd like to stress the need to have an audit (third party or done on your own) to verify if the supplier can actually do all they say they can do (quality, lead time, IP protection, customer service, raw materials... ). The two most cost effective and just plain effective things you can do are:

1.  Independent audit BEFORE you place the PO and sending money
2.  Product Inspection by a third party (or yourself if you have experience doing QC audits of Chinese factories) before the goods ship from China, and BEFORE final payment is made.

As these two items cost hundreds not thousands of US dollars, I would go so far as to say new buyers are putting themselves in great danger if they opt not to do these steps.

In my orders to new suppliers, I like to do a third step, which is to verify the financial stability of the supplier. Operational due diligence is also affordable and will answer the key items such as:

Does this supplier have a good reputation among buyers, suppliers and staff?

Are they in a solid financial situation and unlikely to disappear with my funds?

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