In China sourcing something is always lost in translation

Today a vendor sent me pics of a sample they had been working for me. When I forwarded them to my client she pointed out that the vendor failed to grasp one concept of the product and how it is used. I explained to her that this is perfectly normal and to be expected because it sometimes it just takes time for vendors to come to an understanding about a product they are being asked to make. The reason is that American products are different from those sold in China in many cases vendors are seeing a product for a first time. When they do they look at a new product they see it with the eyes of a Chinese consumer and not the end American consumer. When I used to work with basket vendors in China making gift baskets for the US market I ran into this problem all the time. A case in point: Chinese consumers favor glossy finishes on baskets while American consumers traditionally liked more matte finishes. The result was that we tended to get more baskets with glossy than with matte finishes. Even if the vendor understood our requirement some of his/her workers might not have. I would add that sometimes, if not often, Vendors in an effort to please their customers take liberties with design, changes they think enhance a product but changes which of course are not acceptable to importers with very specific product guidelines.

The best way to circumvent little surprises like this is to gradually educate your vendor about your product and standards and to check production at every step of the way to make sure they are getting it right. Put problem areas in red on your spec sheets and make sure vendors pay close attention to them. And never accuse your vendor of negligence if you get back a product that is not to your liking. Chances are the flaw is in the design or communication and you have to keep in mind that you are relying on your vendor to help you build your business.

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Sourcing in China. Assembling in the US. An option for first time importers

I am working on a project now which has me sourcing component parts from two different suppliers. This is a new product and it has been a challenge finding a supplier who can do the entire product which consists of one fabric part and another molded part. In China textile vendors do textiles and plastic vendors do plastic and never the twain shall meet, as they say. One option would be to use a trading company but I never advise using a trading co for a product that is design oriented, as my client’s is in this case. So we have decided to source parts from different suppliers and then make a decision who will do the final assembly and packaging. One option would be for my client to do it herself. This of course will add to her costs but it will give her more control over quality. Since this is her first order and the QTYs are not large it is an option I like. My thinking is that once she has sales up and going and her product is established in the market she can then source the finished product in China. With the finished product in hand she could attend an industry specific trade show in China and find a vendor rather easily I would think. For one of the challenges finding a vendor for this product is that it is new and still coming together, and unable to see the end product and its packaging, some vendors have a hard time grasping the product and its utility.

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In fact, I have had other clients who did business this way. Just starting out, they sourced the parts in China and did the assembly in the US. It was better for them because it gave them more control over quality and also they could market their product as “Assembled in the US.” They were able to do this because the QTYs were not large and they had the space to warehouse and distribute the product, another important consideration if you decide to go this route.

So this is something you may want to consider for your first order unless of course you have someone you can rely on in China to help you out including arranging a final inspection of your order for you before it leaves China. Another tip: no matter how small your order make sure you have a good logistics person on your team since there is plenty of documentation when importing products, or parts, from China, size of order notwithstanding.

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In China sourcing always try to start small

One of my former clients called me today asking me to reach out to a vendor we had worked with before for a new quote. This client has been told by big retailers he is approaching that he must be at a certain price point in order for them to carry his product. So this means we have to reduce the price with vendors in China. The only way to do this is to increase order QTY. Nothing but simple economies of scale at work here. My customer knows this and so he wants me to run some large QTYs by vendors to see what we need to do in order to get the price down.

I told him that this was all fine and dandy but I advised him that it was extremely risky to give a big order to a vendor he had not yet tested with a series of small orders. As they say in Chinese干大事必须从小事干起. ( gan da shi bi xu cong xiao shi gan qi ) trans: Before you do something big you need to do something small. Giving a big order to a new vendor is something I would never advise doing unless a person were prepared to spend a month in China supervising production. Of course the expense of doing that would offset any savings from economies of scale.

And this is the fundamental problem in China sourcing for small businesses, how do you get a vendor interested in your business at costs that work for you without giving them a huge order and assuming a lot of risk ? 20 or 30 years ago this was not a problem as China vendors just wanted the orders, big or small and the US retail landscape was not so competitive. Things are different now and vendors want big orders. Unfortunately all you can do is to try to find a vendor who you can work with and start small. Much easier said that done I should point out. The only other option is to re-design your product to make it cheaper. And right now this is what I am advising my client to do. Right now, I think that is his only shot.

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Don’t overlook product labelling requirements

There was a very interesting story last month about Target’s foray into Canada. It seems that someone, somewhere in Target’s supply chain got the UPC # wrong the result being that Target’s shipment of Barbie dolls to Canada was bottlenecked and created a major problem for Target’s entire operation in Canada. The moral of the story, check your labeling and packaging specs carefully.

But it is uncanny how often I get emails from people who have products for which they do not know the labeling or packaging requirements. For example, I had a project last year for a lady who was making a children’s garment accessory in China which she was selling online. She sent me some samples and I saw there was no care label on the product. I asked her about this and this was her reply:

“We have the country of origin on our box packaging above the UPC codes. Are you saying they need to be on the bags as well? I know we don’t have anything printed on the bags. I’ll have to look into that. “

I told her that yes, if it is a textile product, which it was, it needs to be labeled. I sent her the link to the US ITA ( International Trade Association) homepage where it is written as follows:

The U.S. Customs and Border Protection (CBP) and the Federal Trade Commission (FTC) enforce labeling laws and acts in the United States. In general, textile and apparel products sold in the United States must be labeled with the following information: the fiber content, the country of origin, the manufacturer or dealer identity, and the care instructions.
She looked at the USITA site and came back to me and said as follows:

‘It looks like we will need to add a tag to the bag that states country of origin. Perhaps up at the top, like shirts are?’

So always make sure that you know your labeling requirements before giving a product to a vendor. And a good tip is this. Proof your labels, tags, UPC codes several times and when you are done have a few other people proof them so you can be sure they are correct.

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