Manufacturing: The end of cheap China China is the world's largest manufacturing power. Its output of televisions, smartphones, steel pipes and other things you can drop on your foot. The main motive behind sourcing China is to procure goods for cheap.

A cheap manufacturing facility would typically be a ‘high- volume, low-complexity products’ factory; and these are some of the things you are likely to witness there: Minimum amount of pre-production work Absence of dedicated lines Minimal time spent on each product by production operators More importance given to price than quality Short-term mindset

China now accounts for a fifth of global manufacturing. Its factories have made so much, so cheaply that they have curbed inflation in many of its trading partners. But the era of cheap China may be drawing to a close. Costs are soaring, starting in the coastal provinces where factories have historically clustered

Those importing goods from China for the first time are largely unsure of the country's business environment, which is in sharp contrast to that of the West. The services of sourcing agents are thus seeked to help navigate these risks. And though an authentic China sourcing company can really help in sharing the burden, there is a downside as well to using an intermediary.

Sourcing agents also generally get paid a percentage on the total order value in addition to the hidden commission - dependent on the fact that the order gets shipped and paid. Which implies that they have an incentive to see the order go through. High price often dissuades a purchaser from placing an order. That's another reason why prices in China are strategically kept low.

Remember, whether they are capable of fulfilling it satisfactorily or not, everybody in China is out to grab your order. It is known to them that, once they got you to spend weeks or months to refine samples and once they got your deposit, it is much harder for you to switch to another supplier. If you are planning to develop a strong supply chain to support your business into the future, the time and money spent in the pre-deal analysis, will prove to be quite an investment.

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