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Why outsourcing manufacturing to China is the right choice

By Jesus David Cano Romano
March 25, 2016
Chinese Factory


At China 2 West we are convinced that outsourcing manufacturing to China is the best choice you can make. Our assumption is based on several reasons that we’ll show you here.

 

 

  1. Costs

 

Of course this is the most obvious reason but a pivotal one, that is worth emphasizing. Pricing is one of the primary determinants of a buying decision. To stress the importance again, this means that your product’s price is influencing your sales significantly. If you’re not planning on spending a great fortune on Marketing and building a brand, price will be a factor that may give you the advantage over a competitor’s product. Even though labor costs in China have been rising perceptibly, they’re still 30-80 % lower than in the United States. Furthermore the capital costs, which equal the money required for bringing your project in a commercially operable status, are lower in China as well.

  1. Service

Every company starts as a small company. It takes time and years of investing and building a network to grow. Walmart, Apple and Amazon didn’t pop up overnight either. Unfortunately not every supplier is willing to work with small companies due to lower order quantity or higher risk. Speaking from our own experience, this problem tends to occur more often with domestic suppliers in the United States. Due to the specialization of China on manufacturing, it’s easier for the supplier to produce for small companies.

  1. Efficiency

As mentioned already, the specialization of China on manufacturing brings many advantages. The capacity limits of manufacturing quantity as well as the capacity limit of time are higher than average in China. The Chinese suppliers are able to produce a great output in a short time. This again means that efficiency for manufacturing in is typically higher.

  1. Innovation

In a previous blogpost about stunning megaprojects in China we presented some fascinating outcome of innovation in China. So what makes China so successful when it comes to innovation? First of all China is doing research and development with higher efficiency mainly by externalization. Another key point is the commercialization of test products  to get a feedback from the market for constant improvement. Chinese are also very good in working in teams and with the largest population of the world, China has many potential talents and knowledge.

  1. Experience

China’s manufacturing boom attracted many international companies with the broadest variety of products in all fields. This means that suppliers have a lot of experience already and you can benefit from that knowledge. Of course you need to find a supplier that has experience in your specific production field. At China 2 West we can help you finding the right supplier for your products. Also see our Blog on how to find reliable suppliers.

 

We hope China 2 West gave you a good overview of the advantages coming along with outsourcing manufacturing to China. To get more information about manufacturing in China you can visit our Homepage. If you want to find out more about the different regions, we have an post for you in our Blog.