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How to Identify the Legitimacy of a Chinese Wholesale Supplier

The number of U.S. companies that are involved in sourcing products from China has increased dramatically over the years. This makes it really important to check the proper verification of the Chinese supplier. It is a prime concern for all businesses to identify whether they are dealing with a factory or trading company when importing certain products from China.

You can find wholesale suppliers in China online. They look good. But how can you be sure the supplier is legitimate and will meet your needs? By following few safety measures, you can protect your business interest by perfectly verifying the Chinese supplier you are dealing with.

  1. Businesses can seek assistance from the verification companies that can protect them from online scammers and pretenders who seem to be everywhere in China. Verification check service providers can protect you by confirming and verifying any company or supplier before you sign contracts or make payments.
  2. While checking business license of the supplier, it is the Business Scope part that is most important. For checking the validity and authenticity of the supplier Business Scope is vital as it cannot be counterfeited. The business scope can be very helpful in determining whether or not you’re dealing with a ‘proper’ manufacturer or a trader. For manufacturers, the listed products tend to be more specific, and within the same category.
  3. Experienced Chinese sourcing agents always advise business owners to have some Chinese language knowledge and a basic understanding of how the business registration system works in China. You don’t need to be an expert in Chinese language, but having functional knowledge over the language could prove to be an added advantage.
  4. All products have their own industrial areas in China. The names of Chinese companies always include the company’s registered location, whether it’s at a national, provincial, city or township level. It is imperative to check the geographical location of the company, its manufacturing area and its offices.
  5. Payment frauds are the most common incident while doing business China. The first thing you should check is the bank account details of the supplier. The company name of the bank account holder must match the supplier name. Never pay to a personal bank account or one that is not matching the suppliers English language company name.
  6. It is a good idea to check the supplier’s registered capital to verify whether it is a factory. If with large registered capital, then it’s factory, otherwise, it’s trading company. Do keep in mind that if your supplier is a small-scale factory, its registered capital will be likely less than big trading companies but that doesn’t mean they are fake.

To sum up, it is a clever option for the foreign importers to ask for samples before placing the order to the suppliers. This way they could be sure of getting the exact product they have ordered.

About Michael Wong

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