Getting a product manufactured in China isn&#;t difficult if you know the right steps to take.
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It&#;s essential that you have complete, production-ready documentation, and a qualified sourcing agent who can quickly find the right factory, negotiate prices, and inspect the order prior to shipment.
In this article, experienced China sourcing agent Mike Genung will explain the most critical aspects for successfully manufacturing your product in China.
The most common mistake has nothing to do with which the Chinese factory they chose, or how they went about looking for a supplier. Rather, it&#;s a failure to have a detailed, prototype tested, manufacture ready set of engineer&#;s drawings for all parts of their product.
Going to a factory to manufacture your product in China without detailed drawings is like playing Russian roulette with five bullets in the chamber; the chances of it blowing up in your face are high. It&#;s critical that you have worked with an engineer, created drawings, tested those drawings by making a complete prototype of your product, then made the necessary changes in the drawings to finalize them.
When it comes to manufacturing products in China, it&#;s in your best interest that all of the details are clearly shown in engineer&#;s drawings, including all dimensions, tolerances, finish requirements, materials, and packaging.
For example, we&#;ve received drawings that only showed &#;plastic&#; as the material. There are many different types of plastic; PP (polypropylene), PVC (polyvinyl chloride), PET (polyethylene terephthalate), PE (polyethylene), and PC (polycarbonate) are just a few. All have different wear, hardness, and finish characteristics. There are also food grade plastics.
Same with metals. We&#;ve received drawings that just showed &#;aluminum&#;, but there are many different grades of aluminum with different tensile strengths, purity levels, machining, and finish characteristics.
If you don&#;t spec out which materials you want in advance, a Chinese manufacturer will use what&#;s most easily available to them, (and probably, the cheapest), increasing the chance that you will receive a low grade material and won&#;t be happy with the results.
You&#;ll want a complete, written set of objective standards for your product that you can hold the factory accountable to. If they make the product with materials that you didn&#;t spec in your drawings, or if the dimensions are out of tolerance, the Chinese factory is liable to replace the parts or compensate you.
If you need drawings or a prototype made, we offer engineering and prototyping as a part of our services. The engineers we have partnered will work with you to get the drawings and prototype right so that when we submit your drawings to a factory in China, you can be confident that you&#;re ready to manufacture your product.
Of course, if the product you want to manufacture in China is something simple like a stuffed bear, a sample will suffice and you won&#;t need drawings. Or if you want us to find an existing product that is widely available in China, such as a flash drive, made to a certain style, pictures showing the style would be enough.
Remember to spec out your packaging requirements. If you want custom packaging made, the factory would need graphic files, preferably in pdf and AI (Adobe Illustrator) files. You&#;ll want to work with a professional graphic artist to create your package design and the artwork.
Once we have your drawings and/or prototype, our role is to locate the best factory for your project in China. We have three partner companies, located in Qingdao, Ningbo, and Shenzhen that give us quick and easy access to China&#;s industrial base, most of which is located along its eastern seaboard.These are among 3 of the top cities for manufacturing in China.
Place your project with one of those partner groups, they will go to work prequalifying the best factory for your project. Once they have a factory in mind, they will submit your drawings for a quote.
As establishing and maintaining partnerships in China can be difficult because of the differences in business culture to the US. We have long standing partnerships and are established in China, providing the benefit to our customers with more efficient and quicker quotes.
Our quote to you will include mold or tooling costs, should they be needed, the cost to make and ship a sample to you by air, the minimum order quantity, and price per part. Unless your parts are very small and lightweight and could be shipped by air competitively, our standard procedure is to include the cost of sea freight in with the part. Sea freight shipments are substantially less expensive than air shipments and are how most import shipments are made.
If, after receiving our quote, you want to proceed with production, you would place a purchase order for the production run and molds or tooling that would be subject to sample approval. A 50% deposit would be required for the molds or tooling, in addition to the sample cost, and the factory would produce first article production samples for your approval.
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Note: You should never pay a 100% deposit for any orders from China, sight unseen, especially if new molds need to be made. That&#;s usually a bad sign that something might be wrong at the other end, such as the factory having a cash flow problem, or having the intent to take your money and run. We&#;ve had customers tell us that they paid a 100% deposit and then the Chinese factory disappeared or went bankrupt.
Once you&#;ve received the production samples, be sure to thoroughly test them for fit, function, and finish. What you see is what you&#;re going to get in production, so it&#;s critical that you thoroughly test the sample for any flaws.
Once you approve the sample, the 50% balance of the molds or tooling would be wired to China, along with a 30% deposit for the production run of parts.
During this entire China manufacturing process, our company and our partner in China will be intimately involved, working with the factory as needed to insure that the product is made to spec. Occasionally, a factory might come back with a question on an adjustment that would make it easier for them to produce the product, such as if there is an issue with parting line or ejection of the parts from the mold. We will work with you to fine tune the design as necessary and get your approval for any changes that the factory might have requested.
Once the production run is ready, our partner company in China will perform a general inspection of your order, which would be in addition to the factory&#;s own quality inspection processes. We also offer you the option of having an independent, third party inspection company come in to inspect the shipment at an additional fee. The inspection company would provide you with a complete written report that would include pictures. Some of our customers use this service for every shipment because they like the peace of mind that comes when the inspection is done by unbiased personnel.
Once you&#;ve signed off on the shipment, payment would be remitted to China for the balance of the order, and our partner company would get the shipment on its way to you.
The bitterness of poor quality remains long after the sweetness of low price is forgotten.
&#; Benjamin Franklin
There are many factories available in China that can make a product for a few cents less than the other guy. But if they can&#;t deliver a quality product on time, then the price becomes irrelevant. If you negotiate a great price but get a container full of junk, you lose.
This is why our primary focus in helping our customers get their products made in China is to locate a reliable factory that can deliver quality products on time. Our people in China do work hard at negotiating competitive prices for you; it&#;s just that the price isn&#;t the only consideration.
Our approach to getting your product made in China isn&#;t to scrape the bottom of the barrel to find a factory that will quote the price &#;you want to hear&#; at all costs. Over the years, we&#;ve seen that it&#;s not uncommon for a China manufacturer to quote a lowball price to get an order, and then&#;things start to go wrong.
The product isn&#;t delivered on time, or if it is, the quality doesn&#;t meet the expectations of the customer. Or, in extreme cases, they manufacturer doesn&#;t deliver at all.
The company that imports a quality product at the best price with reliable delivery times, wins. Those who focus on price alone take risks.
Our role is to help you be a winner.
The next step is to provide us with information, prints, and/or a sample of your product. We&#;ll take it from there, and show you how to manufacture in China every step of the way.
Our New Product Development and Importing from China pages provide more in-depth information on the process of getting your product made in China and how to import from China.
Contact Us to get your questions on how to get your product manufactured in China answered and learn how we can start the process of getting your product made in China.
President Biden&#;s economic plan is supporting investments and creating good jobs in key sectors that are vital for America&#;s economic future and national security. China&#;s unfair trade practices concerning technology transfer, intellectual property, and innovation are threatening American businesses and workers. China is also flooding global markets with artificially low-priced exports. In response to China&#;s unfair trade practices and to counteract the resulting harms, today, President Biden is directing his Trade Representative to increase tariffs under Section 301 of the Trade Act of on $18 billion of imports from China to protect American workers and businesses.
The Biden-Harris Administration&#;s Investing in America agenda has already catalyzed more than $860 billion in business investments through smart, public incentives in industries of the future like electric vehicles (EVs), clean energy, and semiconductors. With support from the Bipartisan Infrastructure Law, CHIPS and Science Act, and Inflation Reduction Act, these investments are creating new American jobs in manufacturing and clean energy and helping communities that have been left behind make a comeback.
As President Biden says, American workers and businesses can outcompete anyone&#;as long as they have fair competition. But for too long, China&#;s government has used unfair, non-market practices. China&#;s forced technology transfers and intellectual property theft have contributed to its control of 70, 80, and even 90 percent of global production for the critical inputs necessary for our technologies, infrastructure, energy, and health care&#;creating unacceptable risks to America&#;s supply chains and economic security. Furthermore, these same non-market policies and practices contribute to China&#;s growing overcapacity and export surges that threaten to significantly harm American workers, businesses, and communities.
Today&#;s actions to counter China&#;s unfair trade practices are carefully targeted at strategic sectors&#;the same sectors where the United States is making historic investments under President Biden to create and sustain good-paying jobs&#;unlike recent proposals by Congressional Republicans that would threaten jobs and raise costs across the board. The previous administration&#;s trade deal with China failed to increase American exports or boost American manufacturing as it had promised. Under President Biden&#;s Investing in America agenda, nearly 800,000 manufacturing jobs have been created and new factory construction has doubled after both fell under the previous administration, and the trade deficit with China is the lowest in a decade&#;lower than any year under the last administration.
We will continue to work with our partners around the world to strengthen cooperation to address shared concerns about China&#;s unfair practices&#;rather than undermining our alliances or applying indiscriminate 10 percent tariffs that raise prices on all imports from all countries, regardless whether they are engaged in unfair trade. The Biden-Harris Administration recognizes the benefits for our workers and businesses from strong alliances and a rules-based international trade system based on fair competition.
Following an in-depth review by the United States Trade Representative, President Biden is taking action to protect American workers and American companies from China&#;s unfair trade practices. To encourage China to eliminate its unfair trade practices regarding technology transfer, intellectual property, and innovation, the President is directing increases in tariffs across strategic sectors such as steel and aluminum, semiconductors, electric vehicles, batteries, critical minerals, solar cells, ship-to-shore cranes, and medical products.
Steel and Aluminum
The tariff rate on certain steel and aluminum products under Section 301 will increase from 0&#;7.5% to 25% in .
Steel is a vital sector for the American economy, and American companies are leading the future of clean steel. Recently, the Biden-Harris Administration announced $6 billion for 33 clean manufacturing projects including for steel and aluminum, including the first new primary aluminum smelter in four decades, made possible by the Bipartisan Infrastructure Law and the Inflation Reduction Act. These investments will make the United States one of the first nations in the world to convert clean hydrogen into clean steel, bolstering the U.S. steel industry&#;s competitiveness as the world&#;s cleanest major steel producer.
American workers continue to face unfair competition from China&#;s non-market overcapacity in steel and aluminum, which are among the world&#;s most carbon intensive. China&#;s policies and subsidies for their domestic steel and aluminum industries mean high-quality, low-emissions U.S. products are undercut by artificially low-priced Chinese alternatives produced with higher emissions. Today&#;s actions will shield the U.S. steel and aluminum industries from China&#;s unfair trade practices.
Semiconductors
The tariff rate on semiconductors will increase from 25% to 50% by .
China&#;s policies in the legacy semiconductor sector have led to growing market share and rapid capacity expansion that risks driving out investment by market-driven firms. Over the next three to five years, China is expected to account for almost half of all new capacity coming online to manufacture certain legacy semiconductor wafers. During the pandemic, disruptions to the supply chain, including legacy chips, led to price spikes in a wide variety of products, including automobiles, consumer appliances, and medical devices, underscoring the risks of overreliance on a few markets.
Through the CHIPS and Science Act, President Biden is making a nearly $53 billion investment in American semiconductor manufacturing capacity, research, innovation, and workforce. This will help counteract decades of disinvestment and offshoring that has reduced the United States&#; capacity to manufacture semiconductors domestically. The CHIPS and Science Act includes $39 billion in direct incentives to build, modernize, and expand semiconductor manufacturing fabrication facilities as well as a 25% investment tax credit for semiconductor companies. Raising the tariff rate on semiconductors is an important initial step to promote the sustainability of these investments.
Electric Vehicles (EVs)
The tariff rate on electric vehicles under Section 301 will increase from 25% to 100% in .
With extensive subsidies and non-market practices leading to substantial risks of overcapacity, China&#;s exports of EVs grew by 70% from to &#;jeopardizing productive investments elsewhere. A 100% tariff rate on EVs will protect American manufacturers from China&#;s unfair trade practices.
This action advances President Biden&#;s vision of ensuring the future of the auto industry will be made in America by American workers. As part of the President&#;s Investing in America agenda, the Administration is incentivizing the development of a robust EV market through business tax credits for manufacturing of batteries and production of critical minerals, consumer tax credits for EV adoption, smart standards, federal investments in EV charging infrastructure, and grants to supply EV and battery manufacturing. The increase in the tariff rate on electric vehicles will protect these investments and jobs from unfairly priced Chinese imports.
Batteries, Battery Components and Parts, and Critical Minerals
The tariff rate on lithium-ion EV batteries will increase from 7.5%% to 25% in , while the tariff rate on lithium-ion non-EV batteries will increase from 7.5% to 25% in . The tariff rate on battery parts will increase from 7.5% to 25% in .
The tariff rate on natural graphite and permanent magnets will increase from zero to 25% in . The tariff rate for certain other critical minerals will increase from zero to 25% in .
Despite rapid and recent progress in U.S. onshoring, China currently controls over 80 percent of certain segments of the EV battery supply chain, particularly upstream nodes such as critical minerals mining, processing, and refining. Concentration of critical minerals mining and refining capacity in China leaves our supply chains vulnerable and our national security and clean energy goals at risk. In order to improve U.S. and global resiliency in these supply chains, President Biden has invested across the U.S. battery supply chain to build a sufficient domestic industrial base. Through the Bipartisan Infrastructure Law, the Defense Production Act, and the Inflation Reduction Act, the Biden-Harris Administration has invested nearly $20 billion in grants and loans to expand domestic production capacity of advanced batteries and battery materials. The Inflation Reduction Act also contains manufacturing tax credits to incentivize investment in battery and battery material production in the United States. The President has also established the American Battery Materials Initiative, which will mobilize an all-of-government approach to secure a dependable, robust supply chain for batteries and their inputs.
Solar Cells
The tariff rate on solar cells (whether or not assembled into modules) will increase from 25% to 50% in .
The tariff increase will protect against China&#;s policy-driven overcapacity that depresses prices and inhibits the development of solar capacity outside of China. China has used unfair practices to dominate upwards of 80 to 90% of certain parts of the global solar supply chain, and is trying to maintain that status quo. Chinese policies and nonmarket practices are flooding global markets with artificially cheap solar modules and panels, undermining investment in solar manufacturing outside of China.
The Biden-Harris Administration has made historic investments in the U.S. solar supply chain, building on early U.S. government-enabled research and development that helped create solar cell technologies. The Inflation Reduction Act provides supply-side tax incentives for solar components, including polysilicon, wafers, cells, modules, and backsheet material, as well as tax credits and grant and loan programs supporting deployment of utility-scale and residential solar energy projects. As a result of President Biden&#;s Investing in America agenda, solar manufacturers have already announced nearly $17 billion in planned investment under his Administration&#;an 8-fold increase in U.S. manufacturing capacity, enough to supply panels for millions of homes each year by .
Ship-to-Shore Cranes
The tariff rate on ship-to-shore cranes will increase from 0% to 25% in .
The Administration continues to deliver for the American people by rebuilding the United States&#; industrial capacity to produce port cranes with trusted partners. A 25% tariff rate on ship-to-shore cranes will help protect U.S. manufacturers from China&#;s unfair trade practices that have led to excessive concentration in the market. Port cranes are essential pieces of infrastructure that enable the continuous movement and flow of critical goods to, from, and within the United States, and the Administration is taking action to mitigate risks that could disrupt American supply chains. This action also builds off of ongoing work to invest in U.S. port infrastructure through the President&#;s Investing in America Agenda. This port security initiative includes bringing port crane manufacturing capabilities back to the United States to support U.S. supply chain security and encourages ports across the country and around the world to use trusted vendors when sourcing cranes or other heavy equipment.
Medical Products
The tariff rates on syringes and needles will increase from 0% to 50% in . For certain personal protective equipment (PPE), including certain respirators and face masks, the tariff rates will increase from 0&#;7.5% to 25% in . Tariffs on rubber medical and surgical gloves will increase from 7.5% to 25% in .
These tariff rate increases will help support and sustain a strong domestic industrial base for medical supplies that were essential to the COVID-19 pandemic response, and continue to be used daily in every hospital across the country to deliver essential care. The federal government and the private sector have made substantial investments to build domestic manufacturing for these and other medical products to ensure American health care workers and patients have access to critical medical products when they need them. American businesses are now struggling to compete with underpriced Chinese-made supplies dumped on the market, sometimes of such poor quality that they may raise safety concerns for health care workers and patients.
Today&#;s announcement reflects President Biden&#;s commitment to always have the back of American workers. When faced with anticompetitive, unfair practices from abroad, the President will deploy any and all tools necessary to protect American workers and industry.
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