The Top 6 China Sourcing Foundational Principles

1. Preparation

Start with a clear strategy. Begin with the end in mind.

When sourcing you are not just buying a single product. You are often buying many products together from many different sources. So you need an overarching sourcing strategy to ensure that your overall objectives are being met. Any sourcing project needs to align with your overall strategy.

2. Specification

Communicate requirements precisely, especially final specification and/or approved sample.

Too many projects suffer because the specification hasn't been clearly communicated. How can expect the supplier to quote or manufacture the correct product if this hasn't been communicated to them?

Most important is that the final specification is 100% clear as this ensures that there is a clear standard for manufacture and for quality control.

3. Competition

Create competition among qualified suppliers in your tender process to ensure a competitive offer.

There is a real skill in creating enough tension to keep suppliers motivated and engaged. Make them aware you are going to market while at the same time sell them the dream about the benefit of being a supplier to your business.

Make sure the tender process is well organised and perceived to be fair. If not, you will quickly turn off prospective suppliers.

Be prompt in your responses and keep the project moving to finalisation as quickly as possible.

4. Correlation

Select the best supplier for your spend, quality, and operational needs—not just the biggest supplier or the cheapest.

Check out this post on our blog. The biggest factory is not necessarily the best factory. The best factory is one that is 𝕛𝕦𝕤𝕥 𝕣𝕚𝕘𝕙𝕥 for 𝕪𝕠𝕦𝕣 spend! | In Asia Advantage

5. Coordination

Proactively manage the entire order process. Without coordination, outcomes will not match expectations.

Too many buyers place the purchase order and then assume that all will go well. We find that the first purchase order needs special attention to ensure that it is delivered on time and to specification. Otherwise, factors such as artwork finalisation, test reports, packaging spec finalisation, production scheduling, pre shipment inspection booking and shipping bookings are delayed which delays the whole project.

6. Verification

Validate factory capability directly—never rely solely on internet info. Always conduct pre-shipment (or in-process) inspections.

This is very important. Some buyers (particularly smaller buyers) do 100% of their verification online. This is super dangerous as it is relatively easy for people to have an impressive online presence that makes them look like a fantastic factory. At best you run the risk of over-paying. At worst, you run the risk of paying for goods that you don't receive. Always make sure that factories are verified with a physical visit.

Conclusion:

Success in sourcing depends on mastering these principles to build a high-performing new product pipeline.