Last week I paid several factory visitations to some Shenzhen-based companies in China upon request of some foreign buyers.

All the three companies are Gold member or Trust pass members in Shenzhen, who all claimed that they were real manufacturers of electronics in China. I’m sure most of the foreign businessmen will be astonished at the result of my visitation in Shenzhen; here is the basic information from my visitation report:

Company One:
Declined my visitation on the pretext of goods shortage, but they promised to receive us before our departure to Shenzhen.

Company Two:
Received us at an office in a Hotel, there are 3 salespersons working in the office. We cannot even find a Logo on their company in the office and on the door. They are checked out to be a small offshore trading company in China.

Company Three:
This is the best one among the three. They are a registered small trading company in China, however, they do not have their own right to export ( I mean they do not have the Certificate of Import & Export issued by local government authorities ), they normally export their goods via Freight Forwarders, for which the buyer may bear some risks.

They registered only on 2005.08.26; however, they claimed themselves they registered in 1999 online. They do not have any factories at all. They cannot show me any quality control measures and after sale services in written forms; they cannot even show me a formal sales contract!!

My suggestion:

You’d better deal with larger trading companies or manufacturers directly for sake of better quality control in China. Lot of trading companies disguise to be a real manufacturer in China, so a factory visitation or inspection is very necessary for a large order in China! A factory visitation can tell you everything about the supplier and it’s one of the best way to verify your Chinese supplier!

What can a factory visitation performed by a local bring you?
As we all know, there are many false things on the web, which perplex us often when we are going to make a decision. The case is also true with buyers who are going to buy from oversea suppliers. Here I bet a factory visitation (better by a local person) is a second-to-none solution.

1.Genuine or False?
The local person can go and check the company (the potential seller) and all its factory registration information to see if it’s a genuine and serious enterprise. This is the basic thing that any buyer has to do before any sincere cooperation!

2.Production Competence (Throughput)?
The visitor can inquire about the factory’s producing ability (also known as throughput) with the director of Production Department. How much can they produce in a month or a quarter? By learning their production competence, the buyer can avoid the risk of a delayed delivery to some extent.

3.Quality Control?
The visitor can try to get to know the factory’s quality control system with the help from the director of Quality Control Department. He can also get to know more by inspecting their assembly lines or work shops. Good quality is always one of the crucial things that buyers are always pursuing.

4.After-sale Service?
After-sale service is also important for buyers. Here the visitor or inspector can make sure if the factory can offer good and effective after-sale services and also confirm if they can include after-sale services as one clause in the contract? After-sale services can keep you free from some troubles.

5.Export License?
Some suppliers do not really have export license. Here the visitor can check the supplier’s registration information with the local customs to see if it can really export directly to the buyer’s country. This is also one of the factors that can free you from being scammed. Other qualifications of the supplier can also be checked out by a local expert in this field in China.

Thank you for your attention, good luck, everybody!

Justin Yuan from Changsha, China

Replying to [Business in China]:
Justin,
Great article. Resolved a few outstanding questions I still had regarding a factoy inspection.

Could you speak to the differences between a factory visit as you have described and a factory audit. I keep hearing both phrases used and am unsure what the differences are, if any.

Replying to [Business in China]:

Replying to [Foow]:

Theoretically I do not know too much on the difference between them, I just believe' Seeing is believing' and I think they play the same role or function for buyers among international trade......hehe

Replying to [Business in China]:

Yes, I visited and inspected factories in China and US, and your experience are very similar to mine. Visitation of factory is a very good way to check who you are dealing with. And also how sincere they are willing to work with you.

Unfortunately, there are many small business owners who have neither the resources nor the ability to travel overseas for factory visits. If there were some ways to do a factory or company check without leaving the country, it will be a great help to them financially.

Very nice effort.

Replying to [Thomas1976]:

Yes, I agree with you here. Our factory visitation report or audit can help lot of small businessmen smooth their business in China as we're local Chinese.....You can save lot of travelling expenses and time to visit your Chinese suppliers in person. Also it's easier for scammers to cheat you in China as you're foreigners and know nothing about Chinese...Our services can be of great help to some small and mid-sized foreign buyers sometimes.

Replying to [Business in China]:
Thanks Justin. I had a feeling they might actually be the same thing but people just use different names.

Replying to [Foow]:

Ask Aussie for details here, I regard Aussie as an expert in this field. Hehe...

Replying to [Business in China]:Good artical, justin,you bring us some important information and I think factory visitation is necessary for buyers indeed.Hope read more articles from you!

Replying to [Business in China]:

you're an experienced guy in China. Thanks a lot!

Replying to [Business in China]: