The Factory is Not Your Friend

A China sourcing veteran shared advice that seemed cynical: “The factory is not your friend.”

I’ve come to appreciate the wisdom in those words.

A recent case brought this into focus: a company discovered they’d been paying above-market rates to a longstanding supplier—simply because they’d never conducted competitive tenders. The relationship felt strong, but complacency had cost them significantly.

We must recognise the importance of relationships in Asian culture. However, we must also balance this with commercial reality.

Factories are businesses, not charities. While their hospitality is genuine and reflects a rich cultural tradition of relationship-building, it doesn’t guarantee optimal pricing. It’s your responsibility to ensure customers receive competitive value—which requires your suppliers to deliver competitive terms.

✅ Maintain professional distance—be friendly, not friends
✅ Embrace the hospitality while understanding it’s part of business culture
✅ Implement regular competitive benchmarking through RFQs and tenders

Strong supplier partnerships are built on mutual respect, clear expectations, and market-competitive pricing.

Regular market validation protects both your competitiveness and the long-term success of the relationship.