Despite severe competition from countries such as Vietnam and India, sourcing products from manufacturers in China still offers many benefits. For several reasons, China still has an edge over competitors, says sourcing and quality control expert Ties Coolen. “In fact, Chinese manufacturers are doing a better job on environmental aspects than they did five to ten years ago. The government’s focus on environmental impact is paying off.”
Coolen, founder and CEO of CoolenChina and Quality Control China, has been an expert in China for more than fifteen years. The 37-year old businessman has a lot of experience in the field of purchasing, quality control and outsourcing in China for large, small and medium-sized enterprises.
With wages going up in most of China’s industries, is sourcing products still interesting?
“It is. Maybe even more than before. It is true that wages have gone up and that eventually comes back in the price you pay for products. Some businesses decided to source products in Europe again, particularly in the period that the dollar value was not favorable. Fortunately, Chinese manufacturers have progressed in their procedures and quality awareness as well, so chances are that you can insist on a better-quality product. One could say they are better able to deliver on the specs that clients from Europe and the US require.”
“The same goes for environmental requirements. China’s government have imposed stricter rules on the environmental impact of production, of the – possibly damaging – raw materials they use in their processes and of the use of certain coatings. Manufacturers comply, as government inspectors have been known to easily close factories that do not abide by the new environment policies.”
Isn’t China suffering from the competition, like Vietnam and India?
“Yes and no. We have been active in these countries for a number of years. Wages are 30 to 40 per cent lower, but besides the cost issue, they have a different offering. These countries produce different products, like hand-decorated furniture and tableware, in a style that is totally different than China’s machine-based products. Other than that, there are communication problems and quality issues in Vietnam and India – it is hard work and it requires a lot of attention to get the quality of sourced products right. Also, there are logistic issues to be aware of. As roads and other infrastructure are not as good as in China, delivery takes many weeks more than when dealing with China.”
What is the current situation?
“Now that the dollar situation is better, clients that can take larger stock find dealing with China attractive again. They also like the relatively shorter delivery times: 4 to 6 weeks of production and 4 to 6 weeks of shipping from China as compared to 6 to 12 weeks of production and 3 to 5 weeks of shipping from India.”
What about your business, how has your offering evolved?
“From the beginning, our Quality Control China business has specialized in Factory Audits (FA), First Article Inspections (FAI), During Production checks (DPC/DUPRO), Pre-Shipment Inspections (PSI), Container Loading Checks (CLC) and several other support services, like Custom inspections and audits. Over the years, we have also taken on the supporting and guiding role in the purchasing process, which means that we function as a partner. We specialize in turn-key delivery of the whole product – including finding a manufacturer, purchasing, quality control and logistics. In a growing number of cases, we deliver additional services, for example to businesses that have been active in China for some time. Often, they prefer to handle certain phases in the sourcing process by themselves, while we optimize specific tasks.”