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Positives And Negatives Associated With Importing Products From China: Necessary Considerations
Each time we see the label "Made in China" we are reminded that China is a place where various items are manufactured for a fraction of the US cost and distributed to over a billion potential buyers. Corporate giants including Wal-Mart are investing intensely in China. Thousands of small to medium sized businesses are getting in on the action as well. In fact, it can be said that 2000 was the decade that got thousands of entrepreneurs to seek how to import goods from China.
China has enjoyed an average 9.5% yearly growth throughout the past 10 years, and its Gross Domestic Product (GDP) increased from $ 300B in 1985 to $ 1,600B in 2004, larger than the state of California. Meanwhile, its foreign trade volume has increased twelve-fold! Foreign direct investment has reached $ 550B for the same period. China's blistering modernization from 1990-2010 made importing goods from China really attractive to retailers around the world.
The country's first production census revealed that from 2004 to 2007, the GDP growth rate was of 10% each year. In 2007, the officially recorded GDP growth rate was 11.4 %. In 2008, the global economic crisis began to slow down China's growth rate. To settle the crisis, the government decided to pour Rmb (China currency) 4 trillion into the economy as an economic stimulus plan consisting largely of investments in fixed infrastructure and human capital.
Although at the beginning of September 2009 mainland China was engaged in new trade problem with the US over the imposition of an emergency duty on Chinese tires, a full-blown trade war has a very little possibility as this is not in the best interest of each of those countries. Mainland China is the number one creditor of the US, while the US is the Mainland's second largest export market following the European Union. A trade war between two of the world's leading economies will also be bad to the global recovery just underway. China import export is here to stay, for the moment.
Northern Asia commonly (Japan, South Korea, Taiwan, Vietnam, and Mainland China) is an excellent place for manufacturing products (Vietnam is the same as China fifteen years in the past).
The clear benefit of Mainland China today lies in the low production, workforce and advanced quality control measures, making it by far the most attractive place of the region.
More importantly, bear in mind that Chinese companies will provide you with what you request, even when it is not comply with their production standards. They have a great competence to produce a very unique design by mixing several existing ideas you might have submitted to them. While Westerners do not normally like (or are even capable to) adapting their production standards to special customer requirements, a Chinese company would look at this a standard characteristic of their service.
Standardization such as ISO or 6-Sigma is not very popular in China, but is adopted by the higher end companies. However, regardless of your order quantity, quality control with China is a MUST. You need to receive what you order and in the exact way you ordered it. From simple to sophisticated products you should monitor quality control with Chinese producers. Apply multiple QC check points during different stages of manufacturing. An importer's worst nightmare is receiving a full container load of merchandise that is defective resulting from a wrong screw size, for example. If you still try to sell them, or sell products that you don't know was designed wrong and later falls apart, this brings considerable product returns, angry customers, and an accounting/billing department nightmare. As the CEO of your own company, you are responsible for ensuring that your products adequately meet desired specifications.
Positives And Negatives Associated With Importing Products From China: Necessary Considerations
The clear advantage of Mainland China today lies in its low production, labor and improved quality control measures, making it by far the most attractive Asian country for importing.
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