Manufacturing in China – How a good business partner may influence the future of your business

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factory china manufacturing

China represents a central peon on the market. Looking at it from a business point of view, China has become an economical power that dominates the global manufacturing market.

factory china manufacturing

Whether we are speaking about clothes or the latest smartphone models, China manages to cover various sectors on the market and reach countries from all over the world. The Asian country has transformed into a big manufacturing power sought by great countries from different parts of the globe.

Many businesses seek such partnerships because of the way it impacts their growth and determines their development. A good manufacturing partner can make a company’s revenues increase and help them gain a strong position on the market.

The power of a manufacturing partner

When a business needs to find a partner that will manufacture their products, they have two options:

  1. Find the manufacturing business themselves
  2. Hire a manufacturing partner that will find such a business for them

The first option presents several risks. First of all, finding a trustworthy business on a market you do not know is a difficult task. The manufacturing business may not have the experience they describe or may not provide the service. This leaves the other business with a financial gap and with unsatisfied customers. Secondly, the services of the manufacturing business may not reach the standard the seller is looking for.

China has transformed into a great manufacturing power in the past two decades. In 1990, the country’s production represented less than 3% of the global manufacturing output by value (Source: The Economist http://www.economist.com/news/leaders/21646204-asias-dominance-manufacturing-will-endure-will-make-development-harder-others-made). In the present, it reaches almost 25%. Furthermore, it has obtained top positions in various fields of production. For instance, China manufactures 80% of the world’s air conditioners, 70% of the total number of mobile phone and 60% of the total number of shoes. Therefore, it occupies strong positions in great domains, from electronics, technology to clothing.

These numbers imply that China has a large number of factories over the entire country. This can make it hard for businesses to find and choose a suitable factory for them. This is the moment when manufacturing partners come into discussion. These persons act as an intermediate and their main task is to find trustworthy factories for the people that hire them. Besides this aspect, they will also:

  • Make a proper selection of possible candidates
  • Work on pricing packages
  • Negotiate price changes
  • Organize a bidding process
  • Help businesses select the appropriate candidate and negotiate the contract

Manufacturing partners present several advantages for businesses.

  • Experience
    They have experience in finding trustworthy manufacturing businesses that offer quality services. In this way, the company that is looking for such a provider has a guarantee that it will receive the desired products. This leads to great results, quality services and successful partnerships.
  • Direct communication with the factory
    Although the manufacturing partner is the intermediate between the business and the factory, the communication between the two sides is still direct. Business owners can visit the factory at any time or contact them to inform them about new information and possible changes regarding the product. This aspect helps the business create and maintain a human relationship with the factory and understand better the manufacturing processes.
  • Control over the entire process
    The manufacturing partner is responsible with finding a factory based on the criteria described by the business. All the other aspects which include finances, payments, duration of the partnership are completely controlled by the business. For example, if the business decides to stop working with the manufacturing partner, the collaboration with the factory can continue without any complications. This gives the business the ability to control the situation in a suitable and profitable manner for them.

The benefits of working with China

Due to the fact that China is a great manufacturing power and has a wide diversity of factories, businesses may choose to look for possible collaborations in this country. In addition to these aspects, China comes with a set of advantages for the businesses interested in working with their factories.

Low costs  

When it comes to manufacturing in China, one of the greatest advantages is represented by the low costs of production. Currency exchange rate and the “clusters” (a concentration of providers and experienced people in a particular field) in domains such as clothing and electronics are just two examples that sustain this fact. Low costs in production mean more extra money for the other sides of the business. This helps businesses not only maintain their position on the market, but also grow.

Large numbers of products  

Chinese factories are able to produce large amounts of products in the period of time that the businesses ask them to. This fact is supported by the numbers and positions they occupy in different global industries. This helps businesses from several points of view. First of all, it supplies all of their product categories and thus, it keeps their customers satisfied. They avoid the unpleasant situation of telling their customers that certain products are not available. The final result is that it keeps and also increases their sales, which helps in the business growth process.

Ability to easily duplicate products

China reached great positions in several industries due to its capability of duplicating products. Businesses can show and give details of a certain product and Chinese factories are able to produce a great copy. This is a great advantage as it allows businesses to have the exact products that their customers need.

 

Why is it important to have a good business partner?

China has shown clearly the advantages of working with its factories. When trying to define Chinese manufacturing businesses from the business point of view, they can be described in two simple words: business partners. They play an important role in a company as they have the power to influence the future of the business. Whether they are represented by a manufacturing factory or an intermediate who connects the business with a service provider, business partners can help companies in several aspects.

Objective opinion

When businesses are on the point of making important decisions, they need opinions that will provide them an objective perspective over what might happen. Business partners are the persons who can offer this to them and can help them understand the consequences of their move and the wider picture. Business owners need such people around them, especially when one of their objectives is to grow their business.

Knowledge on a particular field

Whether we are talking about a manufacturing factory or a consultant, business partners who have knowledge in a particular field are a gold mine. They know specific details that help businesses avoid crucial mistakes that can damage their reputation and compromise their success. For example, if a business wants to sell electronics and is interested in manufacturing them in China, it needs some information before starting the process. A business partner who knows which countries use plugs with 2 pins and which with 3 pins will help a business understand why they should work with manufacturers only from specific countries and save it from ordering the wrong products.

Brainstorming

A business partner can come up with new ideas and solutions for solving a problem. Businesses need such persons around them, as they are able to see things from the exterior and provide a different perspective. Their growth process and road towards success strongly depends on this aspect.

Do not underestimate a business partner!

The moment when a business chooses a business partner is crucial. A good business partner may influence the future of it. However, a bad business partner can take a company off the market. There are a few signs that indicate a business partner does not occupy the right position and a change is needed.

Communication difficulties

Communication is the key to success. When owners have frequent issues on this aspect with their business partners, they should consider two options: continue having unpleasant discussions with their partners which can lead to bad business decisions or replace their partner with a new person for a better communication and better collaboration. Good communication means wise well-analyzed decisions which lead to business success.

Unfulfilled duties

When business partners do not fulfill their tasks, this affects directly the entire business. Imagine the company as a machine where every person’s work contributes to the well-functioning of it. When people do not respect their responsibilities, the entire machine suffers.

Unqualified for the job

This is a situation that demands an immediate change from the business leaders. Partners who are not able to do certain tasks or inexperienced in the field they said they were, are not able to deal with crisis situations and may not provide the help that you need in those moments.
Business partners are crucial persons and have a great influence in the future of the business. Choosing one is a great decision and business leaders should make sure that their partners understand, follow and respect the values, mission and objectives of the business.

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