There are two phrases that we must take into consideration to do business in China:
- China is an intermediaries' country
- In China, everything is negotiable
There are many stories of people that have seen videos, brochures and presentations of factories, but when they're checked out they aren't so, doesn't exist or are just the cell phone number of a fisher in troubled waters.
Serious chinese merchants work in three levels of quality: low, medium and high. Products manufactured for USA, Europe, Australia and similar markets are made at the high quality level, for Latin America are usually made at medium level and low quality level for Africa and other countries. This is the common denominator, you must negotiate the quality of your product to avoid annoying surprises at the time of marketing your product. That is why it's recommended to have an inspector in China that allows you to check your products: colors, quantities, quality, in order to pressure the manufacturer to make the product in the terms agreed.
You can sign an agreement, but the execution of the contractual obligations is hard and late in China, often times, it doesn't have a future. It happens a lot with that the intellectual, industrial and property rights and breach of contract claims doesn't prosper.
So, to whom should I buy?. It's a good question, amongst many attractive and interesting offers is not easy to decide. It is important to note that the price offered to you is not only competitive but similar in price, prices too low can be traps for those who are not very observant. Not only your money could be taken away, you can also be a victim of fraud on the quality and/or quantity, or your products may actually be going to produce as requested but not in the time period agreed upon. You may receive your goods after 6 months of payment, while the company works with your money.
We recommend simply assessing how much confidence can you put on that company, if you have representation in their country and if they have a very competitive price. Once you have entered the Chinese market, you will have plenty of time to investigate further, you may be buying from an intermediary but if the price is good and the negotiation conditions are safe, it is perfectly feasible to do so.
It is important that you have a serious contact person, that allows you to know the status of your investment in both production and transportation of it, since your safety is the most important thing in your business.