Advantages and Considerations
A. Rising quality, falling demand for brand names
Many retailers are growing less dependent on brand names in part because they, and their suppliers, demand and receive good value from Chinese suppliers. When two products are equal in specifications and one is significantly cheaper, a retailer can provide great value to the end customer by choosing the less-expensive product as long as the customer does not demand a brand name. Many large, well-known Western retailers are thus no longer willing to pay premiums for brand-name products when they can get products of equivalent quality for less money.
B. Better service
China's low product and labor costs are well known; its advantages in services are often underestimated. Today, when a small or medium-sized importer needs labor-intensive, value-added services, Chinese suppliers and logistics service providers are capable of responding. Applying labels or mixing products on a pallet can be extremely time-consuming and labor intensive. Since Chinese labor costs a fraction of US labor, it is worth examining whether a particular service can be performed in China.
In Summary, with lower costs for products and labor in China and an ever-growing selection of more sophisticated logistics services, you may find that the time is right to explore sourcing in China. In fact, you may find you cannot afford to pass up the opportunity. |
