Online
Marketplace

Auto
Parts & Accessories

Consumer
Electronics

Drones
& Robotics

Electronic
Components

Fashion
Accessories & Footwear

Fashion
Apparel & Fabrics

Gifts &
Premiums

Hardware

Home
Products

LED
& Solar Products

LEDs
& Optoelectronics

Machinery
& Parts

Mobile
Electronics

Security
Products

Smart
Living

Underwear
& Swimwear

Trade Shows

Global Sources Exhibitions

Electronics

Mobile Electronics

Gifts & Home

Fashion

Other Trade Shows

Magazines

Magazines

Sourcing Reports

Other
Services

Get
Quotations

Product
Alerts

Analyst's Choice

Sourcing News & Advice

Private Sourcing Events

Buyer Support

About Us

Reliable exporters: find them and meet them

Path: Sourcing
News & Advice >> Import
from China Advice >> What most China sourcing agents do not want
you to know

What
most China sourcing agents do not want you to know

Posted: March 26,
2012

by Mike Bellamy
To test my theory that the vast majority
of vendors encountered by foreign buyers are actually just middlemen or
brokers rather than actual manufacturers, I decided to attend a trade show
in Mainland China. I brought with me an electronic fuel pump used in the
quality intensive US automotive marketplace. This product combines
electric and gasoline - one would assume anybody willing to quote on such
a dangerous and technically demanding product would have a lot of
production experience. I stood in the main hall of the trade show and held
up a sample of the fuel pump and said in English "Can anybody here make
this item?" In the blink of an eye I had 15 interested parties. All
claimed "mei wenti" ("no problem") and boasted of their factory direct
connections and great pricing. If only it was this simple to find a
supplier.

After interviewing all of them, it became obvious that these were
people (both Western and Chinese) with only loose connections and no
industry experience. They were essentially just middlemen. One was even a
cab driver who carried the brochures of all the factories in the area. He
would ask the foreign visitor what product they were looking for then
magically pull out a brochure from the truck. He then would invent a
cousin that has ownership in the given factory thus making up a story
about why he could help broker a deal for the buyer to ensure good price
and quality. Some naive foreign buyers actual did business with him only
to learn that their price was inflated 15% by the back door deal worked
out by the cab driver and the factory. Worse off, the factory was just
randomly picked based on the recommendation of the cab driver and it
turned out this supplier had no proper QC system and as a result most of
the parts delivered had quality problems. Today, the amount of money
involved in the China Sourcing game is so large that when visiting China
just about anybody (bar tenders, hotel staff, exchange students, tour
guides, translators, friend of friends and even cab drivers) will offer to
be your source in hopes of making a quick buck. BUYER BEWARE!

Definition of middleman

There are good and bad
middlemen. For the sake of this book the bad type of middleman is an
intermediary who provides little value in the supply chain, perhaps only
playing match maker but building in a margin. On the surface, in order to
have more perceived value, they may claim an intimate relationship with
the factory, but if they do not allow you to communicate directly with the
factory, then you are dealing with a middleman.

If the intermediary is providing legitimate value (for example
logistics, project management or quality inspection) then perhaps there is
a place for them in the supply chain. But if the intermediary is not
transparent in where their margin lies, then most likely the actual value
for their inspection or project management service has been greatly
inflated. Before you sign up with an intermediary simply ask that they
separate the costs for their "service" from the "production costs". If
they fight this, then you know their actual value to you is minimal.

Mike Bellamy is an Advisory Board Member & Featured Blogger at the
not-for-profit China Sourcing
Information Center. He is also the author of "The
Essential Reference Guide to China Sourcing" and founder of PassageMaker
Sourcing Solutions.

Read more Sourcing
News & Advice

Find Suppliers Online

Browse Product Categories

New Products

Top
Products

Top China Suppliers

Source by Country

Top 20 Products by Industry

Wholesale Directory

Wholesale Products

Factory
Directory

Product
Catalog

Fabricantes y Maquinariabeta | Global Sources

Buyer Tools

Message Center

Global
Sources Apps

Sourcing News & Advice

Sourcing e-Magazines

Sourcing Reports

Global
Sources Direct

Get
Quotations

Supplier Tools

Reach Qualified Buyers

Sign up for a Free Trial

Become a Verified Supplier

多渠道曝光/推广

供应商成功故事

免费网上广告注册

高效参展

About Us

About Global Sources

Our
Services

Our
Quality Commitment

Buyer Testimonials

Investor Relations

Videos

Meet Suppliers Face-to-Face

Sourcing
Fairs

Private Sourcing Events

Buyer Support

What
Every Buyer Needs to Know

Ask the Sourcing Experts

Learn to
Source from China

Help

User
Guide

Help
& FAQ

Contact Global Sources

Site
Map

Follow Us

Facebook Twitter Google + LinkedIn RSS

Global Sources Sourcing Sites: GlobalSources.com

Global Sources Other Country Sites: Hong Kong

Global Sources Management Site: 世界经理人

Copyright © Media Data Systems Pte Ltd (Singapore Co.
Reg. No. 199001601W). All rights reserved.

Terms of Use Privacy Policy Security Measures IP Policy About The Translation