While it may seem that the financial benefits of working with Chinese suppliers are waning, in fact, China remains the third largest trade partner of the U.S., behind Canada and Mexico. According to the seventy-four billion dollars United States companies have sent to China, you are likely to offshore some of your manufacturing operations at some point. Seventy-four billion reasons make China a leading partner for companies of all sizes, but especially small businesses.
Advantages of China: U.S. Dollar Strength &Scalability:
It is stated in Entrepreneur magazine that if your organization is looking for quick turnaround, high output, low cost, as well as the ability to scale quickly and seamlessly, then China is the place to be. Particularly if you are operating a small business and need the flexibility to ramp up suppliers in china production on a moment’s notice, China is a very attractive option, since it accounts for over a fifth of all manufacturing exports worldwide.
The reality, as far as costs are concerned, is that, despite the fact that Chinese wages have risen considerably in recent years and reports that the manufacturing advantages no longer exist, the US dollar is still nearly seven times stronger than the Chinese Yuan.
China has Become More than just a Source of T-Shirts:
in recent years. Thousands and thousands of companies keep an ongoing relationship with their Chinese counterparts. It matters not whether you’re from the aerospace powerhouse Boeing, electronics maker Dell, heavy equipment manufacturer Caterpillar, or food maker Kraft Foods, China is a great place to increase margins and boost profitability-and that includes you and your small business. Furthermore, the short list given above illustrates just how broad in scope the Chinese advantage can be, and it is not limited simply to cheap t-shirts and knock-off sunglasses. The opposite is actually true, with all of the nation’s biggest and highest-revenue companies depending on Chinese business to boost their revenues.
“Made in China” becomes trendy:
The risk of dealing with any non-domestic supplier needs to be considered by any small business owner who does business with them. This is especially true when it comes to China where there have been numerous reports about issues like poor quality that have been reported. It would appear that quality control would be an area that most organizations struggle with, however, these instances are often not as severe as they appear at first glance. It’s been so long since ‘Made in China’ has been considered a ‘cool’ word because over the last few years, quality has improved to the point where China’s primary suppliers have been sought out for their good reputation and proficiency in supply chains.
Understanding Chinese Payment Systems &Navigating Language Barriers:
Although quality uncertainties are one area businesses should prepare to deal with (as with any offshoring relationship), the real obstacles will be the language barrier and the geographic distance between a manufacturing facility in China and your domestic office. Since energy prices are currently low, transportation costs are low at the moment, but businesses should prepare for when they increase. Another concern is the payment process for your suppliers in China, which can be opaque and bureaucratic.
Find your Chinese Supplier with these Resources:
You can establish a long-term relationship with one of the thousands of companies in China by finding a supplier that can help you manage your supply chain in an efficient and cost-effective manner. The number of companies developing relationships with China has grown substantially as a result of the growing availability of resources to find, work with, and manage those relationships. You can begin your search for a Chinese supplier by following these five tips:
- Alibaba – one of the largest business-to-business (B2B) websites in the world
- China Sources – a website that connects businesses with Chinese manufacturers and suppliers
- HKDC – this site offers a directory of over a million suppliers in China, as well as various business matching services.
- Smart China Sourcing – consists of more than 80 sourcing experts and is ISO9000 certified.
- Made-in-China – the premier B2B marketplace offering sourcing experts as well as quality products and companies.