Opinions, knowledge and resources from China Checkup's expert contributors
When you’re buying products from a Chinese company, a common issue is whether you’re dealing directly with a China trading company or with a factory.
This is because many such trading companies in China will be ‘unclear’ at best regarding the issue of who they actually are.
Despite their best attempts to disguise the truth, it is actually quite simple to find out if a factory is, in fact, a China trading company.
It can be quite challenging to determine if your supplier is a China trading company or a manufacturer. Some will even blatantly pretend to be a manufacturer when they are not.
This has some implications when you’re trying to source from them:
These are rare scenarios, but as with all due diligence it is well worth making sure that nothing is amiss in order to reduce your exposure to risk.
So how can you determine whether you’re communicating with a China trading company or an actual Chinese manufacturer?
As always, the first step is to ask for a copy of the company’s business license. This is always the starting point, and we make this point frequently here. The business license will tell you explicitly what kind of company you’re dealing with.
Once you’ve got a copy of the business license, you’ll need to look at the ‘Business Scope’ label (经营范围 – Jīngyíng Fànwéi).
The 'Business Scope' on the business license will tell you (in Chinese, of course) what category of company you’re dealing with by listing all of the products or services it is officially permitted to offer.
See China Checkup’s glossary of common business scope terms for some examples of the key business scope text you can identify from a Chinese business license.
What if you don’t want to let the company know that you’re researching them, though? Or, what if you don’t feel comfortable trusting the business license document they’ve shown you? In either case, the next step is to view the company’s registration record. Since 2006, these have been made available online to the general public by the AIC (Industrial and Commercial Administration Bureau, 工商行政管理局, Gōngshāng Xíngzhèng Guǎnlǐjú) for each province of China.
You need to identify which province the company is registered in, find the AIC website for that province, and then use the company’s registered Chinese name to search for their record. You can then use this public record to corroborate the information shown on the business license, or to check a company’s category (trading company or manufacturer) without them knowing.
Following this process will identify if they are indeed a China trading company. But note that this process must be done in Chinese, because Chinese is the only official language of mainland China.
If you’d like a convenient, streamlined way to have this process completed for you, you might consider a China Checkup company verification report. We use our expertise and knowledge to research a Chinese company you’re interested in, including translating and explaining their public registration record, plus other information you’ll find useful in assessing them.
One of the most common ways to pay a Chinese supplier is to make a China T/T Payment, but it is not a method that comes without risk.
We regularly see cases where Chinese suppliers request payments to individual accounts, third parties, offshore accounts and offshore entities, rather than to their own Mainland Chinese corporate bank accounts.
Before sending a China T/T payment, pause and take a moment to make these 4 simple checks - they will help you ensure your payment is really going to the correct Mainland China entity.
In recent years freight trains from China have been capturing newspaper headlines by arriving in more and more countries.
Perhaps there is no more striking example of this then when the first China to Spain cargo train returned to Yiwu having covered a world record 16,156-mile round trip in 2015.
Read this article to learn about China's push for international rail cargo and find our which countries have already received freight trains from China.
With multiple international codes, hundreds of area codes and numbers of different lengths, making sense of China phone codes can be challenging.
Determining if a Chinese phone number is a mobile or a landline, and knowing where in the country it is located can be a useful way to better understand who you are dealing with.
If you want to learn more about China phone codes, including international codes, area codes (both 2-digit and 3-digit) and mobile codes, then this article is for you.
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Matt Slater
Author
Hi there, I'm Matt, the founder of China Checkup. Originally from the UK, I am now based in Brisbane, Australia.
Frustrated by the scarcity of concise, high-quality and timely information about Chinese companies, I setup China Checkup whilst living in Shanghai in 2013.
My team are proud that China Checkup's company verification reports have now helped thousands of clients from all corners of the world to do business in China more safely.