One of the first blogs I started following regarding importing from China was Renaud Anjoran's blog at QualityInspection.org. His blog is a treasure trove of information, so you'll do yourself a favor by spending some time digging through the archives there (particularly check out the Importers Best Practices here).
Renaud also runs Sofeast which is a quality assurance agency based in Mainland China. If you have never used a quality inspection agency, you'll likely be surprised how affordable arranging an inspection can be. More importantly, it's an easy and inexpensive way to help ensure that you receive high quality products and to help you sleep better at night. Renaud can be contacted through the Sofeast Website.
How did you first get started with your career in importing from China?
Renaud : I worked for 18 months in the Hong Kong office of a company that imported from China and Vietnam into Europe. That was in 2005 and 2006.
How long have you lived in China?
Renaud: I’ve be in mainland China since 2007, so it’s been nearly 8 years. I’ve been running my company all that time.
For a lot of first time importers it seems quality control first becomes an issue after receiving a shipment of sub-standard products. What are some of the things importers can do, even if on a limited budget, to ensure they receive high quality products?
Renaud: That’s very true! Inexperienced importers tend to trust Chinese suppliers way too much. And, since they look inexperienced and without a strong long-term business, Chinese suppliers are more likely to cut corners.
Here are a few things importers can do on a limited budget:
- Ensure you work with a supplier that understands your market and that already makes your product. This will be a lot of work, but it will pay off nicely in the long run.
- Have the factory audited, to ensure it is well organized and you were told the truth. You can probably get it done for under 300 USD. Consider this an investment in setting up your supply chain.
- Document all the expectations in a master specification sheet, rather than having it spread in various emails, Skype conversations, and so on.
- Get a perfect sample in your hands before you authorize production start, if technically possible.
- Have the supplier send you “shipment samples” when production is under way and give them feedback.
- Always have the goods inspected before shipment. Once the goods are on a boat, it is too late! You can’t send defective products back to China, and the supplier won’t give you a refund.
If an importer does receive a shipment of sub-standard products, do you have any advice on how they can best approach it with their supplier? Should they ask for replacements or a price discount on the next shipment? Or should they ignore it (if the problems are relatively small) and try to have it corrected on future production runs?
Renaud: This is very tricky. If you try to negotiate for a settlement, you will probably be offered a discount on future orders. But this is dangerous for two reasons:
- You probably shouldn’t work with that same supplier again in the future. In over 90% of cases, the quality of the second order is NOT better than that of the first one.
- A discount means the supplier will care less about your order, which means issues are MORE likely to occur.
Instead, I’d suggest investigating where the problem comes from. If it comes from poor communication on your side, then you know what to do next time. If it comes from poor execution of your instructions, you need to find another supplier. It seems really hard to swallow, but believe me on this.
For a lot of importers, ensuring low lead times is always a challenge. A supplier, for example, will quote 30 days lead time but won’t complete production for 60 days. Is it still a good idea for importers to always double the quoted lead time? And is there anything an importer can do to ensure their products are completed quickly as planned?
Renaud:I wouldn’t say “double the promised lead time”, but I agree that a buffer is necessary. I’d say add 6 weeks if this supplier is making this product for the first time, and add 3 weeks otherwise.
A contract that calls for late delivery penalties can help – you probably won’t be able to enforce the penalties, but you will be able to put some pressure on the supplier. Another way to speed the process up is to communicate very clearly and to respond fast. Sending an inspector during production is also a good way of putting pressure on a supplier. The best practice is to break down the whole process in a few steps, get the supplier to agree on dates for the major milestones (receipt of all components, production started, first finished pieces, packaging accessories received, 100% finished and packed), and then to track it along the production cycle.
What's one of your favorite things about doing business in China?
Renaud: There are many smart and hard working individuals! But they usually lack technical skills as well as a proven process for approaching their work. Chinese people seldom think in terms of systems and processes, but that’s why there is still a need for foreigners!
What is one of your least favorite things about doing business in China?
Renaud: The attitude of certain suppliers, when they don’t care about a customer and they feel they have the most power in the relationship. It is beyond a lack of politeness.
Tell us a little bit about Sofeast and what services you offer to your clients.
Renaud: Sofeast is a boutique quality assurance agency that offers factory audits, product inspections, and related consulting services to small and midsize importers. I am also involved in China Manufacturing Consultants, which helps China-based manufacturers, trading companies, and buying offices reduce their costs and their quality problems.