by Edie Tolchin
Don Debelak offers affordable patents http://www.patentsbyDonDebelak.com
- Difficult Communication: If you are not experienced in corresponding with China or Taiwan, your first attempt – typically by e-mail nowadays – may be very trying. Although the office personnel at most Asian factories do speak English, it is not the same “English” that we speak here in the USA. Many do not understand our local idioms or jargon, so remember to keep it simple and do not commit to anything you do not understand. Best-case scenario: Pay a little more and hire a translator, or use an international trade consultant who specializes in working with Asian factories.
- Quality and Accessibility Often Depend on the Type of Product: Many Asian factories produce excellent quality sewn and textile items. Their workers can be very talented and creative. However, forget about specialty fabrics or matching prints that you found in the USA. It can be done, but your costs will escalate if you have custom-made fabric prints produced in China. You should also be aware that typically, the best grades of cotton are not found in China or Taiwan. But what about electronic inventions? Very high quality. Printing for packaging is not great, but has been improving over the years. The bottom line is – you really need to see counter-samples before committing to a purchase order. If your product must be specially made with a mold or tooling, first ask to see samples of similar stock items the factory has produced so you can be sure they can achieve the quality and workmanship you are looking for. Always arrange for production testing with an independent safety/testing lab (more info on this to follow in Chapter 2). Always ask for references … and always check them!
- Delivery delays: There will be many delays – especially for first orders – from the time you submit your prototype and the factory sends you back a counter-sample. Be prepared to go “back and forth” by e-mail numerous times before quality control issues are ironed out. You might find, for example, that a button is on the wrong side, a light bulb must be larger, printing needs to be darker, or the outer box has to be thicker. It’s also important to know that during their holidays many Asian factories may close for two weeks or more (as with the Chinese New Year festival), which could delay your shipment. Ask if they can provide you with their holiday schedule so you are aware well in advance of their down times. Also, during typhoon/monsoon seasons everyone is on watch for delays. If you are told that your delivery will be 30-45 days, figure more like 60-75 days, allowing for holidays, coordinating pre-production and mass-production samples, independent testing, etc.
- MOQs (Minimum Order Quantities): You might have heard that sourcing in Asia requires you to purchase huge quantities, and this can be difficult if you are just starting out and merely want to “test the waters” with your product. For many industries the quantity rule holds true. For most new products, the factory itself must source the components for your new invention from several different factories that in turn issue an MOQ to your factory for their products. So, that is why sometimes you must purchase large quantities (50,000 vs. 5,000 pieces). In the textiles industry this can frequently happen. With each new invention that is sourced, in order to make a counter-sample and provide you with a price quote, the factory must get quotes on components such as zippers, buttons, ribbons, thread, fabric, packaging, and labels. Each of your factory’s suppliers has an already-established MOQ. So, as you can see, it is not easy for the factory to just submit to you a quote for a new product within a day or two.
- Quality: Over the many years I have been involved in sourcing, Asian factories have improved their workmanship. Just make sure that your correspondence is completely clear and that you have good working prototypes with easy-to-understand specifications. The old saying goes, “less is more,” but in this case that most definitely does NOT apply. Never worry that you are sending TOO MUCH information. The more accurate data you can furnish to the prospective supplier in Asia, the better the quality of your product will be.
- Attitude: Most Asian suppliers are very interested in establishing a good business relationship with you. They will be eager to please you with the hope that you will continue to work with them for reorders once your product has become successful!
- New jobs? Many worry that if they source their inventions in Asia, it will take away from jobs in the USA. This is not necessarily true. Sourcing and manufacturing products in Asia in turn opens up numerous business opportunities here at home in logistics, distribution, computer graphics, sales and marketing. For example, dockworkers will need to unload your shipment off the vessel and send it by truck or rail to your warehouse, storage facility or distribution center. Your graphic artist will design your logo, labeling and packaging. You will need to engage a Consumer Product Safety Commission’s accredited safety lab for your product design evaluation. And don’t forget about the U.S. marketing firm that could get you some good PR. Once your product(s) are selling, reliable domestic trucking firms can make deliveries to retail outlets all over the USA!
- PRICING, PRICING, PRICING! Did I say, “pricing?” Many new products can be sourced in China, depending on the industry, for anywhere from 1/2 to 1/8 of what it would cost to be manufactured in the USA. This is an obvious advantage to new business start-ups!
For many, the thought of manufacturing overseas is daunting, but with the proper guidance and reliable contacts it can be an option you may want to consider. As with any business plan, there are pros and cons that must be weighed. Remember, asking the right questions and understanding the answers is essential to success in any endeavor. Make sure the lines of communication are clear and you could find the cost savings of manufacturing overseas gives you enough breathing room to launch a successful product and grow a profitable business.