Tel: 860-571-3602  |

Hartford Technologies Blog

Global Consulting Services

Posted: Jul 20, 2020 10:10:12 AM

Streamlining Manufacturing and Product Sourcing in China 

China remains an important source for lower cost products in the global market. Relocating or managing your company’s manufacturing to China can help lower production costs, and support increased volume. 

However, there are also several important considerations to switching or managing your company’s manufacturing to China. These include quality, high minimum orders, and increased shipping costs.

To follow are some key considerations when streamlining your manufacturing and product sourcing in China.

Controlling Your Manufacturing in China

Controlling the supply chain is essential for long-term value. Maintaining ownership of your manufacturing plant ensures control of the product assembly and the management of suppliers. Exporting on your own is key to competitive success but not easily accomplished.

Managing Your Financials in China 

Funds must be provided to the Chinese government up front, and it is important to keep in mind that rules and costs can change overnight. In addition, plant location affects taxes and incentives; locations include Free Trade Zones (FTZ), Bonded Logistics Parks, Export Zones, and Industrial Zones.

Obtaining a Business License in China

Joint ventures are not typically successful, so most companies choose to set themselves up as wholly owned foreign entities, which require more organization and development. 

Requirements for obtaining a business license:

  • Specifics of what you will be doing, manufacturing, exporting, and selling in China
  • Signed lease prior
  • Detailed 5-year “Business Plan” and “Feasibility Report” with revenue and profit projections

Also keep in mind that before you can get a business travel visa, you must have an invitation letter, a hotel reservation, and an airline reservation. In addition, the language barrier can pose challenges, so being prepared for this is of utmost importance. Researching and securing a translator if you don’t speak the language is essential. 

Developing World Class Strategic Supply Partners

Look for the Chinese manufacturing facilities that have expertise that matches your needs. Also look for synergies. It is very important that your suppliers do not sell to your competitors so as to maintain control. Many technically capable suppliers lack the process controls for consistent high quality product but with the proper training and direction they can overcome this deficiency. The objective is the formation of successful, long-term, mutually beneficial business relationships. In addition, investing capital and cash flow to grow the business is important.

Leveraging Market Expansion Opportunities 

Hartford Global Consulting Services has extensive experience manufacturing in China. We can help your business’s global supply chain through:

  • Supplier selection and qualification
  • Training and developing effective processes  
  • Regular auditing operations to ensure supplier follow through
  • Inspection services before release of goods
  • Engineered solutions such as automation for lower total assembly cost
  • Logistics guidance and / or export service through our trading company
  • Precision mechanical part manufacturing and assembly

Contact us today for a complimentary no-obligation consultation on how you can streamline your manufacturing and product sourcing in China.  

Discover How to Develop Lower Production Costs without Sacrificing Quality