#3: All Roads Lead To China – Product Sourcing and Manufacturing

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Expanding on a previous episode of the Lifestyle Business Podcast (Now Tropical MBA), we dig deeper into sourcing products from China with Michael Michelini at Global From Asia (formerly Shadstone).  Michael has been living in Shenzhen, China since 2007 and is involved in product sourcing, manufacturing, import/exports, and internet marketing within the Chinese market.

Topics Discussed:

  • Breakdown of the key players in the China sourcing market
  • How to protect your intellectual property in China
  • Top 3 mistakes people make when sourcing products
  • The importance of building a relationship with your suppliers
  • How to import products into China

Mentions in the Episode:

Episode Length: 27:04

Notes From Michael:

Key Players in the China Sourcing Market: Alibaba and Global Sources are the top directories to search for factories. The problem still exists in how do you verify they are good or not. How to be sure that the order is smooth and without hiccups. This is why there are so many third party sourcing and inspection companies. If you are not on the ground in China, it is best to work with a third party – it is the price you need to pay for not traveling and living in China.

How to Protect Your IP In China: The top way is to register your trademark in China. And no, this doesn’t mean a worldwide trademark you file outside. You can register a Chinese trademark in China without having a Chinese company or being in China. So it is well worth it if you are doing it for the long term.

Top 3 Mistakes When Sourcing Products: So many mistakes but mine (as of 2017) are – rushing the sourcing process, not getting final production samples before placing the order, and not using an experienced third party expert in their sourcing and quality control process.

Building relationships with Suppliers: There is that overused word “guanxi” (means relationships in China) but there is a reason it is so overused. If you are just a username on Wechat, then there isn’t much loss if the relationship is lost. But if you invest time and money to visit the factory, have a meal with them, share your family story, your hometown story – you become someone real. And that goes a long way in China and with factory relationships. Then when there is a time where the factory needs to decide to do your production run or another client, you may get that preferential treatment. It goes a long way, and most buyers aren’t doing it – still!

How To Import Products Into China: This is a total 180 from the factory sourcing, and can be a podcast on its own! The main tactic is to first get a sample to China, ask a customs broker to classify it. A huge issue is many products oversees haven’t yet been classified in Chinese customs – and you may need to invest in that process before sending the products. I have a popular blog post on the 3 ways people can import into China here for detailed reading 9999.

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