We asked one of our clients to give us their impressions during a China factory visit during a buying mission recently. Read below to get an idea of how they felt during this trip. This is one of a series of blogs that we will title: Buyer Diary.
After the Do’s mentioned yesterday, let’s carry on for the Don’ts during China factory visits. Of course, there are many sources which provide good tips for travelling such as NBC News. Here, we provide these tips on the assumption of embarking on a China factory visit.
During your China factory visit, don’t be surprised that the factory managers will build personal relationships and at times even try and dig for beneficial information. It is important during your China factory visit to follow the following tips. Although there are only a few, these tips are highly critical to managing a factory.
Do not engage in business without signing a formal contract
Everything must be in black and white. With a formal contract, both parties are clear about the requirements of this business project. Also, this will reduce a lot more misunderstandings that is bound to happen with China factories. It is best to sign a binding contract that is effective for both local and foreign companies to keep complexities to the minimum.
Unfortunately if there is a need to take legal actions against the factory, I suggest for arbitration instead of the traditional court and legal system. Why so? With arbitration, your company can save on time and cost. For a detailed explanation, feel free to read the Smart Business Magazine.
Do not divulge confidential information or related information without a Non Disclosure Contract
It is important to keep confidential information or even related information such as a separate project that is done with another supplier from the factory. Better to be safe than sorry!
Do not trust the factory
At anytime of your China factory visit, do not trust the factory for any business related details. Be it verbal agreements or a minor change in the project progression – make sure that everything comes with proof. Whether important or not, take them all down! Ensure that it’s in black and white with confirmation.
Do not take the factories’ words as it is
Don’t take a ‘yes’ to mean a ‘yes’. At times, factories are afraid to disagree with clients and say yes even though they mean a no. Factories can be really sly on this – they usually show 100% commitment to get the order from you. After which, all sorts of problems would arise and the factories blame it on different reasons. One of the common reasons used is – Sorry, I didn’t understand your English at that point of time. I thought you meant something else.
Be sure that you do some research for yourself! Whether is it on the project, or testing waters from time to time to ensure that the factory is not lying. An effective solution is to station an employee at the factory to manage important production matters at the same time keep a look out for the factory.
For the China factory visit, ODM sent Patrick along with myself to the factory, such that Patrick could be stationed there and manage the factory for a period of time to ensure production progress. I would say he did a great job!
Do not be a pushover
Well, it is sense to not be a pushover as a person, don’t mention as a businessman! Take a hint of warning – factories can be harsh and insistent at times. So expect your China factory visit to be a hump.
There is no need to be too polite. Make your instructions direct, simple and firm to the factory. Also, make sure to keep your stand when dealing with the factory! Always think twice before reverting to the factory as indecisiveness may portray you as a weakling.
Do not be lenient on the quality control
Quality control is a step in production that must not be overlooked. It stands for QC in short and it reviews on the quality of production goods. There is an international standard for quality control which all inspectors adhere to. Quality control is wholly based on the AQL table (Acceptance Quality Limit), where you decide the passing mark of a QC test.
I suggest – Instead of trusting on the factory to do their own quality control, hire your own professionals and inspect the goods! Having QC not only helps in taking preventive measures for future problems, such as replacing defective goods once QC fails instead of waiting for your client to revoke the order. It also helps in understanding the factory and the current manufacturing.
A word of advice – always, always do the QC at the factory before exporting the goods to the destination! By the time a QC is done at destination, it may be too late. Your company will incur massive costs for shipping just to get the faulty goods replaced!
Keep control of the factory during your China factory visit
As mentioned in our previous entries, factories can be tricky at times. They may use the money that they have invested in you against you. Take for example your hotel stay and transportation. You can read more at China Factory Visit – Buyer Diary #1 Culture & Customs. Do maintain control of the factory at all times as the client. This will definitely be beneficial to the project that you’re working on.
By keeping to this list of Don’ts, you would have pretty much won half the battle, no matter what purpose you are heading to the factory for. Do continue with our buyer diary series for tomorrow!