Outsourcing may be among the most interesting parts of the product development lifecycle. The first step is to imagine a new design in the mind, create prototypes and finally the product is ready to be manufactured.
However, according to most companies that create products, supplying and deciding on a manufacturer can lead to the success or failure of a product. Finding a compromise between deciding on a factory to produce a quality product and managing logistics – such as timelines, shipping and minimal quantities – is the challenge usually encountered in developing new products. It becomes even more difficult in today’s world economy to identify many factories to choose from.
The steps that need to be taken to find a manufacturer in China are as follows:
How to identify the right manufacturers to work with
To get started, identify several factories that a company can learn more about. It would help to get references. A company can contact companies with similar products and inquire about the manufacturer that they use. This way the company can find out more about this company from the perspective of someone in the same position.
At this point, a company must identify the factories that can meet their needs and make a shortlist. In identifying the factories they will investigate in more detail, they should ask the following questions:
Do they like a domestic or foreign manufacturer?
There are important things to consider in choosing between a domestic and overseas manufacturer. There are advantages and disadvantages to each of them, and it also depends on the product they plan to manufacture. They should weigh the cost, quality and speed. Above all, think about your needs. The products that need to be assembled will be cheaper overseas because they have lower labor costs. However, large parts that take up a lot of space in a box will be cheaper locally. In addition, transportation and taxes need to be considered as well.
Do they like to work directly with the factory or prefer to work with a broker / agent who is a factory representative in the US?
The answer really depends on your needs. When they work directly with the factory, this would cost less and they may be more involved. When they work with a broker / agent, although they are less involved, they can work through an agent whose relationship to the plant is already established. It all depends on what is best for your situation.
What kind of manufacturing do they need can be managed by the factory?
It is obvious that companies need to be specific in identifying the manufacturer they need. For example, a factory that works with electronics does not necessarily mean they have the ability to manufacture all kinds of electronic products, since there are a wide variety of requirements involved. Thus, companies should choose a manufacturer that best meets their needs.