China is the nation that is capable of producing all types of consumer goods for lower costs comparing to any other country. It has been noted that a huge number of American manufacturers send raw materials to China, get them assembled there at a relatively lower price, import them and sell them in their home market. Consumer electronics, toys, home furnishing, clothing and machinery, all come to the USA from China, making the import reach an astonishing figure of $463 billion.
Leading import of services from China are transport, travel, and research and development sectors. Buying from China gives America a much better deal than buying from other countries in the world.
There are two basic reasons that make wholesale suppliers of China capable of offering goods at a competitive price –
First- A lower standard of living, which allows companies in China to pay lower wages to workers.
Second- An exchange rate that is partially fixed to the dollar.
Economists all over the world agree on the point that ordering products from the Chinese wholesale suppliers offers fantastic business opportunities for the US based companies and business owners. But along with the profit comes the fear. The Chinese market is not absolutely flawless and the risk is always there. American entrepreneurs can easily avoid any potential risk while sourcing products from the wholesale suppliers of China by adopting more rational and methodical outlook.
While there are many factors to consider while sourcing products from China, we have highlighted the most significant ones.
- Do not Rely Solely on Advertised Supplier–
The biggest mistake that American companies make by solely relying on platforms of Alibaba and other advertised businesses. The fact is, there are many reliable wholesale suppliers existed in China that do not promote their businesses on these platforms. You can get a hold of them only through the industry specific trade shows held in China. The best suppliers often prefer trade-shows because it attracts serious importers who buy in volume and understand international trade.
- Come up with a Sound Sourcing Strategy-
When importing from China, you need to go through a steep learning curve. You can’t claim success at the very first shot. It will take two to three shipments for a US importer to understand the process of sourcing products from Chinese wholesale suppliers. You need to have a proper guideline and a well-defined sourcing strategy.
- Conduct a Due Diligence-
Due diligence is perhaps the most important step when sourcing in China. , Failing to conduct due diligence can lead you to get scammed. Look at their website, social media (Facebook, Twitter, LinkedIn) and verify their registration and certification.
The US entrepreneurs need be methodical and consistent from the very beginning when choosing a supplier. It’s important to consider current as well as potential requirements when choosing wholesale suppliers in China.