Is China Right For Your Manufacturing NeedsGary Lambert | October 3, 2018 | 0 | Uncategorized
Even though China manufacturing services entail large comparative advantages, the amount of risk attached is still overwhelming. Over the past two decades, China sourcing has also gotten a lot more qualitative. What once used to be a “junkyard” for second-rate goods, is now an industry leader in the business of manufacturing.
“Is China manufacturing right for my company?” This is a question that many CEOs grapple with at one point or another when meeting the dilemma of producing high quality products while reducing production costs. China is no longer the source of cheap and low quality goods even though many Chinese companies still defy environmental and safety standards. But with proper planning and diligence, it is possible to find the best quality China manufacturing services that will suit your business needs. There are many reasons why outsourcing manufacturing to China is potentially advantageous to American businesses. Here are some of the top reasons:
Gain Competitive Advantage
Chinese manufacturing services can introduce you to a world of unlimited opportunities, both in business and technology. Chinese manufacturers are no longer the low tech, low cost producers as today, they are at the frontiers of innovation. Low manufacturing costs in China allow you to produce a larger amount of goods at a reasonable cost. But when you are using the manufacturing services of Chinese companies, it’s important to realize that good things don’t come easy. The project can be attained with the right set of information and the right business partner. But to those who march this battle unprepared, it can be a daunting nightmare as well.
Low Labor Costs
Outsourcing manufacturing to China can benefit the company with 30%-80% cut in labor costs. Although the costs of production have risen in the recent years, China remains to be one of the most low-cost manufacturing destinations of business owners that aim to lessen expenses and maximize revenue.
Various Incentives Offered
Chinese agencies offer various incentives for companies sourcing from Chinese factories. China offers a level of agency support that you are unlikely to find in other countries.
Access Downstream Manufacturers
In China, you get to identify and reach out to downstream manufacturers who are increasingly using China as a manufacturing base. This is particularly beneficial for American retailers and companies looking for the manufacturers of the intermediate goods.
The Chinese manufacturing scene is increasingly characterized with high-tech processes, research and development and innovation. These are a few of the advantages that global businesses can now derive from sourcing their products from China. Additionally, companies would able to access highly qualified personnel at relatively lower costs compared to other manufacturing hubs such as Germany.
When it comes to China sourcing, tempting low labor and production costs should not blind you from making sound decision. It is essential to conduct a holistic analysis of your sourcing strategy and the company you plan to partner. Abrupt actions can lead to weak decisions and eventually business chaos. A doctor wasn’t meant to do the duties of a baker, just as a businessman with few to no experience wasn’t meant to tackle Chinese sourcing on his own. Take action, plan ahead and consult a professional.