The risks and benefit of outsourcing manufacturing to China
Following from The Startup Magazine article on ’How small businesses can find buyers in China’, we wanted to share some thoughts on how a start-up can benefit from Manufacturing abroad, specifically in China.
Manufacturing and importing from China can seem daunting, especially if you are a comparatively new start-up or SME and have never thought about outsourcing production abroad before. The reality is this is a difficult task. The protocol of being able to enter Southern China, which is now recognized as being the global manufacturing centre is complicated. Another one of the main problems when importing goods from China is the language barrier
However this should not put you off. There are many benefits of having your product produced in China to very high standards make the whole process worthwhile and viable.
For a startup business aiming to have scale up its manufacturing fast, China is really only feasible in China nowadays. Cost is certainly one factor, but speed is the other major one. For makers and hardware startups, Shenzhen is a huge production resource. You have access to tools, you can iterate on your prototype multiple times a day – all at almost no cost compared to western standards.
If you are tempted to take your manufacturing to China, it is really beneficial for you to work with an intermediate company based in your country and in China. This helps overcome the difficulty of language barrier and have the opportunity to strike profitable deals with the factories out there.
Companies such as Red House Global, enable start-up companies to negotiate directly with the factory, as they do it on your behalf, and also make regular factory visits to check on quality. This type of intermediate company can resolve problems quickly to save time and money.
Whether you need to import products by the container or by the carton they can help. Containers are imported every month and our smaller customers can utilise space on these, saving costs on delivery and having peace of mind that their shipment will be monitored closely.
It is certainly a difficult task for a start-up business to outsource their manufacturing to a country they are not based in. However with planning in advance, and possibly the use of an intermediate company, this is a valuable task as it can be very lucrative for a business.
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