Types of Suppliers in China and Vietnam When Product Sourcing

edited.jpg

If you’re searching for a supplier, these are the different types of companies you will encounter in China. When sourcing on Alibaba, Global Sources or other similar websites, be careful as many trading companies and wholesalers will present themselves as factories. It’s difficult to tell from a beginner's perspective, and it can take a second look to tell them apart. Always remember that the best supplier is buying from the factory directly and not from a reseller.

TIP: When a potential supplier sends you a picture of a product, zoom in and see if you can find a logo or factory name. If you can, you should try to contact the factory directly. Avoid trading companies, resellers and buying offices if you can and try to do business directly with the factory.

What types of Companies should you avoid Working with?

Trading companies

Trading companies are middlemen who make deals with a factory (or more often several factories) and sell a wide range of items. There are a few cases in which it is beneficial to deal with trading companies, specifically when you are looking to buy a small quantity of a wide variety of products. Trading companies also have a markup on the total cost of goods so you will pay more dealing with a trading company. Trading companies generally act as brokers.

Wholesalers

Dealing with trading companies and wholesalers are similar but the key difference is that wholesalers actually buy and store the product and keep it in bulk and sometimes they may even import it from other countries. Due to the extra fees associated with warehousing and other expenses they incur, they will often be the most expensive option.

Resellers

Though not as common, they are similar to wholesalers in that they buy their goods from the factory to resell; however, instead of buying a large number of items in bulk and storing them until they are sold, they will buy the items from the factory as soon as you buy the goods from them. The resellers have some similarities with the dropshipping business model.

What types of Companies should you work with?

Manufacturers

They are the actual factories who make your products. By dealing directly with them you not only will get the best price, but you will get more control of the final product while having more control over the quality of the final product. Your quality standards will be greatly improved as well. If you want quality products at the best price then you should go straight to the source.

If you are sourcing one or two single products you should ALWAYS work directly with the factory. If you are sourcing a wide range of products, and a small number of each, then it may be easier to go with a trading company. Just be aware you are paying a higher price since the trading company needs to get their cut–but the convenience may be worth it.  

TIP: Not sure if you’re talking to a factory? Ask the salesperson to take a photo of themselves in the factory holding up a piece of paper with your name and date on it.   

Let Cosmo Sourcing Verify a Supplier for you for Free!

Cosmo Sourcing has been sourcing product from China and Vietnam for years, and has the skills to find and evaluate legitimate suppliers. Ff you have a supplier picked out but are unsure, reach out to Cosmo and we’ll look them up and verify them for FREE, just email me at info@cosmosourcing.com Seriously, no strings attached!

PLAN // FIND // MAKE // SHIP

Our Simple Sourcing Package, is designed to do everything to turn your idea, into a shipped product. Simple Sourcing Comes with four steps: PLAN, FIND, MAKE and SHIP.

Give us your product idea, and we’ll work with you to find suppliers, oversee the manufacturing and ship it to its final destination. Cosmo can do everything from creating a product spec sheet, validation, sourcing, ordering and evaluating samples, arranging inspections, finding freight forwarders, quality assurance, negotiations and even working with prep and fulfillment centers in the States.

If you are starting a new business, then finding products and suppliers for your products is one of many things you need to handle. OUr services are designed to handle every part of your business in China and Vietnam, so you can focus on the rest of growing your own business.

We have helped clients ranging from Fortune 500 to small FBA sellers. Don’t hesitate to reach out to us and let us know how we can help you. info@cosmosourcing.com OR Visit us online at Cosmosourcing.com