How to Find and Assess China Manufacturers

by Matt Slater December 09, 2016

How to Find and Assess China Manufacturers

Finding and assessing a China manufacturer is a becoming a necessary process for more and more companies worldwide, as increasing numbers of businesses choose to source products in China.

This research process can pose difficulties for companies for a variety of reasons:

  • Despite the presence of English as a global business language, language barriers are still a very real issue.
  • Visiting manufacturers in China is generally highly expensive for outside companies.
  • Knowledge of the Chinese business environment may not be available in-house, and is difficult to develop.
  • Trust and confidence remain central issues in finding Chinese manufacturers and doing business with them.

Unfortunately, these aren’t things that we can fully explain for you in one article here!

Instead we hope to provide some useful starting points and considerations for companies starting out in the process of identifying a good China manufacturer. We also welcome your thoughts – please feel free to leave a comment at the end of the page.

Here we look at common methods for finding manufacturers in China and gathering a short-list of potential suppliers.

Finding a Manufacturer in China

Your obvious first port of call for locating a Chinese manufacturer is likely to be a Google search in English. We’d actually advise caution with this approach, because in our experience it’s unlikely to lead you to good manufacturers in a lot of cases.

This is because a Chinese manufacturer most likely operates entirely in Chinese, and their website content may be minimal or simply nonexistent. Searching Google in English is much more likely to lead you to trade companies, agents and other ‘middlemen’.

Presumably you would prefer to be in direct contact with the manufacturer of your product, which is why we recommend one of the following methods.

Using Sourcing Websites

If you’re looking for a China manufacturer you’ve almost certainly used or at least heard of Alibaba and Global Sources or some of the other sourcing alternatives.

These websites have come a long way and offer a highly useful service. You will almost certainly be able to identify Chinese manufacturers who can potentially make the product you want.

This is also an extremely low-cost and low-commitment method to searching for Chinese manufacturers.

Whilst Alibaba and Global Sources attempt to provide some basic screening against very poor quality and fraudulent listings, they’re fighting an uphill battle and we don’t recommend that you treat their listings as 100% reliable.

Finding potential manufacturers in China is only the first step. After that, there is still a lot of work to be done before any kind of business relationship can be developed.

Visiting Trade Shows

A higher-cost and higher-commitment method for locating your China manufacturer is to identify relevant trade shows and expos and visit them in person.

This is usually a much more rewarding method of finding manufacturing companies in China, as you can meet with staff in person and get an impression of their marketing efforts at the show.

This will provide far more revealing information about a supplier than their listing on a sourcing website.

Further, whilst their presence at a tradeshow is no guarantee of quality or reliability, it is clearly harder to ‘fake’ than a website listing.

ChinaExhibition.com is a good place to start looking for relevant trade shows.

Again, you can never let your guard down when locating manufacturers, and this is particularly true in China. We have had enquiries in the past from people who met a “representative” at a trade show, committed money to a deal, and later found that the “representative” was nothing of the sort.

A lot of these cases could have been avoided with just the minimum of due diligence and background research.

The obvious difficulty for outside companies in visiting trade shows in China is the need for assistants and translators with local knowledge and adequate language abilities.

Most companies sourcing from China do not have this talent in house and will need to hire it in China.

We’d recommend that you don’t assume you can rely on English when visiting China. Whilst some company reps at trade shows speak English, you could be excluding high-quality and reliable manufacturers whose staff lack English ability.

Covering language barriers yourself and not making this a requirement for your China manufacturer is likely to be a better approach.

Using Trade Companies in China

Another option for locating your China manufacturer is to use the services of a trade company in China. Many trade companies in China provide genuine and highly-useful services for their clients, acting as an abstraction layer between outside companies and the business environment in China.

Many trade companies, however, do not provide such a useful service and can actually be a cause of problems in the trade process.

Unfortunately, it is very common for trade companies in China to actually pose as manufacturers, because they know you’d prefer to deal directly with the manufacturer.

This is one reason why listings on sourcing websites must be viewed with a little suspicion – they could well be listings from trade companies and not from manufacturers.

Further, it’s essential to make sure that your contract with a trade company and the supplier/s includes all three parties and gives you protection. Don’t rely on the trade company to protect your interests in its own contract with a supplier.

Because of the above issues, developing a relationship with a trade company in China needs to be treated with just as much care and consideration as finding manufacturers to source your products from.

A relationship with a good trade company in China can be a real asset, but a bad trade company could cause all manner of problems for you.

Building a Shortlist of China Manufacturers

Via sourcing websites, trade shows and potentially the services of a trade company, you can gather a list of manufacturers in China that seem to fulfill your criteria.

This short-list needs to be developed carefully. The next step is to further assess the manufacturers on your list to determine which ones really have potential and are worth visiting in person.

Assessing a China Manufacturer

Identifying a list of China manufacturers that are offering to make your product is only the first step.

We have encountered cases where companies and individuals outside China have simply gone with one of the first manufacturers they could find in China, without any further checking. This is generally not a wise move.

Instead, we’d recommend that you first use the basic checks below to settle on the Chinese manufacturers that you think really have potential, and then visit those manufacturers on site before forming any contracts.

First Impressions & Website Listings

We’ve grouped first impressions and websites listings together here because ultimately they only amount to the most basic kind of filter.

A low-quality website listing or poor attitude at a trade show ought to be immediate indicators of a less desirable manufacturing company.

The inverse, though, is not true. Good-looking website listings and an excellent impression at a trade show are not reliable assessment criteria, and ought to weigh very little in your considerations.

Use these factors to quickly eliminate the worst options, but not to identify the good ones.

References

References have stuck around in the business world for a reason.

They are by far the most cost-effective and fastest way of eliminating low-quality companies from your list.

It’s highly advisable to ask each Chinese manufacturer that you’re interested in for references from companies outside of China that they have done business with before.

They may not be able to reveal huge detail about clients and the products they are making for them, but a legitimate manufacturer should be able to provide references.

Contacting these references will let you really determine which manufacturers are worth continuing to look into.

The Business License

Once you’ve identified a few Chinese manufacturing companies that appear to have potential, it’s time to initiate contact.

One of the most basic and important checks is to request a copy of the Chinese manufacturer’s business license. This is a totally normal and legitimate request, so if they offer any resistance to showing you a copy of their business license it indicates that something is amiss.

The business license will tell you various basic details about the manufacturer, such as their registration number, official name, registered capital and so on.

The most important item on the business license of a manufacturer is probably the business scope.

This tells you what products and services the company is legally allowed to offer, which has obvious implications when dealing with a manufacturer in China.

If the type of product you’re looking to have manufactured is not covered by a manufacturer’s business scope, then technically speaking they are not permitted to produce it for you.

Public AIC Records

As well as requesting a copy of a Chinese manufacturer’s business license, it’s generally a good idea to confirm the information shown by looking it up on the local AIC website (the AIC is the Administration for Industry and Commerce).

Each province in China has its own AIC, and they all function slightly differently. You’ll need to search for the AIC for the province the manufacturer is located in (tip: AIC is ‘工商行政管理局’ in Chinese) and then search for the company on the AIC website.

The AIC public website listing will display the same information as shown on the manufacturer’s business license.

You can use these public listings to double-check that you’re being given accurate and up-to-date information. Any discrepancies should be cause for concern.

You should note, though, that the operational practices of China’s various AICs vary massively. Different AICs update their public listings on totally different schedules and at different frequencies.

This means that whilst the public AIC records are generally reliable, it’s possible for them to get out of date and not show the latest information. Bear this in mind when searching through them.

Hard-Copy AIC Records

The only way to guarantee that you’re seeing the latest information the AIC has on record about a Chinese manufacturer is to send a Chinese lawyer to the AIC office in person to retrieve the company’s records on paper.

Unlike the public website listings which may not have been updated for some time, these hard-copy records are always kept up-to-date by the AIC.

The catch of course is that you need to find and pay for a Chinese lawyer to go and retrieve them for you.

Confirming the Background Details of a Chinese Company

If you’d like a streamlined and convenient way to check the AIC records of a Chinese company, you might be interested in our Chinese Company Verification Services.

All we require is the English name of a company and some identifying details such as its website address.

We will then handle the research and confirmation process for you, including location and retrieval of the AIC records, plus full translation and explanation of the information they contain.

Our China Certified Verification also provides the dispatch of a Chinese lawyer to get the hard-copy AIC records in person.

Visiting Manufacturers in China

After confirming that a China manufacturer checks out on paper, it’s highly advisable to visit them on site in person.

Without doing this, there’s no way to really assure yourself that this manufacturer is capable of meeting your production standards and requirements.

Although expensive, by actually being on site, you can rapidly gain vast amounts of information about the company that otherwise would have been unavailable to you.

Further, a visit to the factory in person demonstrates to the manufacturer that you are serious about doing business with them and about maintaining quality throughout the process.

Be aware that it’s not unheard of for unscrupulous trade companies or other bad actors to actually ‘borrow’ a factory to show you for an on site visit. What this means is that they have no actual factory of their own, but persuade some other legitimate-looking factory to let them put up temporary signs and branding and show you round as a client.

This may fool foreign buyers who lack the knowledge to spot this kind of activity.

This demonstrates how important it is to hire trustworthy staff with knowledge of China and relevant talent if you don’t have this in house.

Aside from outrageous ploys like the above, many manufacturers may have some idea of what specifically you’re looking for on a visit and know that their site won’t meet these standards.

Instead, they may try to temporarily spruce up their factory to give it the appearance of quality that you are looking for.

Again, the only real defense against this is genuine local knowledge and talent on the part of trustworthy staff you have with you during the on site visit.

An Easier Way to Find China Manufacturers

Our Pre-Verified China Suppliers service can help you identify Chinese suppliers with a real data of exporting the commodity you require, which can also provide detailed registration and export record of 5 highest-rated suppliers and a list of up to 20 more potentially-suitable suppliers.

See Also

Note: this article is a re-write of two previous China Checkup articles which were originally published in October 2013




Matt Slater
Matt Slater

Author

Hi there, I'm a British-Australian Engineer and Entrepreneur, recently moved back to Brisbane, Australia after nearly 9 years living in Shanghai. I founded China Checkup in 2013 because I was frustrated by the scarcity of concise, high-quality and timely information about Chinese companies.
My team are proud that China Checkup's verification reports now help clients worldwide do business in China safely. Have any questions? Email me at info@chinacheckup.com

 


Related Articles

The New 18-Digit Chinese Business Registration Number
The New 18-Digit Chinese Business Registration Number

Introduced in October 2015, the new 18-digit Chinese business registration number is being quickly adopted by companies across Mainland China. Appearing on the Chinese business license, this new number is the most clear manifestation of the huge o...

5 Key Features of Chinese Company Names
5 Key Features of Chinese Company Names

Nearly all Chinese company names follow standard patterns and by just reading a company’s name and understanding these 5 key features you can already learn quite a lot about them. For example, where they are registered, what they do (in a broad se...

How to Identify a China Certificate Without Knowing Chinese
How to Identify a China Certificate Without Knowing Chinese

Doing business in China can be a very complex and overwhelming process, especially when you receive what you are told is a critical China certificate but are unable to read Chinese. Most of the really important certificates you should understand a...



Also in Safer, Better Business in China

China Laboratory Accreditation Certificate - An Introduction
China Laboratory Accreditation Certificate - An Introduction

by Matt Slater March 09, 2017

Although many factory's have their own laboratories, few of these are independently certified so requesting testing by external testing body is a wise move in many circumstances.

These testing bodies should be accredited and you can make sure of this by requesting a copy of their China laboratory accreditation certificate.

Continue Reading

China Industry Classification System - An Introduction
China Industry Classification System - An Introduction

by Matt Slater March 03, 2017

Most large economies have systems in place for categorizing their companies, and China is no different. 

The China Industry Classification system is widely used in the collection of official statistical data on companies and organizations throughout Mainland China.

Continue Reading

The 8 Busiest China Shipping Ports
The 8 Busiest China Shipping Ports

by Matt Slater December 22, 2016

With so many products being made in China it comes as no surprise that China shipping ports are among the busiest in the world.

We've looked up the figures, and in this article present the 8 China shipping ports which handle the most shipping containers.

Continue Reading