China Sourcing and Manufacture
Production costs are far lower in China than that of the West. However, the exact savings depend greatly on the product or component, and the service you require. Compared to manufacturing in Europe, savings of 20% to 50% could be expected, dependant on product.
How to get started?
If you are considering Global Sourcing your products or components, the list below would be the basis for obtaining a quotation:
- Product Samples
- Technical drawings, including CADD information if applicable
- Technical specifications for materials and finishing treatments
- Any Special Quality requirements
- Volume/year requirements
- Batch sizes
- Lead time required
- Packaging requirements
- Current production costs
- Target costs
- This would allow you to obtain a competitive quotation to your requirements
What minimum quantities are required?
Quantities will depend on your product or component, and therefore costs will be determined by this. Whilst all Chinese Suppliers would like large batch manufacturing, Source in Asia Limited, feel that batch quantities should be to the customers requirements. We would negotiate with the Chinese Supplier to obtain the best solution for the customer.
Remember, should large quantities be produced, any changes in design may result in the scrapping off of substantial numbers of parts along with the cost which goes with this, so it is important that MOQ’s are correct.
How long does the process take?
If the customer requires a product search to benchmark against other possible sources already found by the customer, Source in Asia Limited, would offer consultancy service fees for time and travel. This would be agreed with the customer.
Should the customer require a turnkey sourcing solution, then project costs would become part of the official quotation and an all-inclusive FOB Shenzhen cost would be submitted.
Extra costs are normally for special services, i.e. design services, some accompanied visits, with all special requirements always being agreed with the customer beforehand.
What and how do I pay for a service?
All quotations will be submitted to the customer as FOB Shenzhen. It will become the customers responsibility in normal circumstances to arrange shipment, although Source in Asia Limited can do this as an extra cost to the customer.
Payment terms would be negotiable with the customer, but would normally be in 2 stage payments, 50% with order and 50% prior to shipment from the Chinese Factory. These are normal payment terms in Asia, but may change once the business relationship between Customer/Supplier extends.
Payment methods would be T/T payments or Irrevocable Letter of Credits at all stages.
Can Quality standards be maintained?
All Chinese Suppliers within our network are accredited to ISO9001:2008 or TS16949, and therefore work to procedurised Quality Systems. It is important that all quality requirements for the product or components are in place prior to any production commencing.
All in-process quality information is monitored on a daily basis by our on site quality engineers and on completion, the batch is again inspected prior to packaging and shipment.
Should a concern be raised through production, the supplier will raise an internal corrective action, the investigation determining the root cause and initiating short and long tern actions to prevent re-occurrence. All corrective actions will be audited for effectiveness on a regular basis by UK Source in Asia Limited engineers.
Where will my products be manufactured?
Most of the suppliers in our Chinese Supplier Network are located in the cities of Shenzhen and DongGuan, Guangdong Province, and therefore, within easy access of HongKong.
The main reasons for using this area are the low manufacturing costs achievable, but also the infrastructure of the area, with excellent motorway systems, allowing quick movement between suppliers.
Due to the close proximity of HongKong, access into China is very easy both by ferry direct from HongKong airport or by road.
Who determines which factory/supplier will be used?
Our customer”s product design and guidelines generally indicate which Chinese Supplier is required to manufacture their goods. Source in Asia Limited will, however, select the most qualified source to ensure that all of our customers” requirements are met.
If there was a defect in one, or some, of the units – how does your company prefer to handle them?
We use a method of first article inspection on all production components and subsequent interval inspections consistent with ISO standards. For large or first time part runs, samples will be provided to the customer for approval. After approval, the production run will begin. In addition to the supplier verifying all dimensions are met, Source in Asia Limited on site engineer/project manager will also perform inspection audits. If there is a defect, we will consult with our engineers and the customer on the best way to solve the problem and corrections will be made at the Chinese factory.
How does Source in Asia Limited maintain competitive prices?
Source in Asia Limited not only focus on the current supplier management and relationship building, but also on potential supplier development, working with the supplier to reduce and maintain their production costs.