OEM Manufacturing in China: More Pros for Business than Cons
For many years, China has been the manufacturing hub of the world. Last year, this production rate shrank, partially due to the impact of COVID-19. This means that China needs your business and there has never been a better time to manufacture in the country. If not you don’t know how to benefit, then we can help. Read on as we discuss why you need to outsource OEM manufacturing to China.
One of the more obvious and important benefits of OEM manufacturing in China is the reduction in cost. The bottom line is that the better your product and price, the more units you will sell. Even if you are putting out a high-end brand, then you can increase your profits by lowering manufacturing costs.
Domestic manufacturing sounds good in theory. However, it has increased overheads that do not exist in China. This makes locally produced products expensive and is why manufacturing in Western countries has declined in modern times.
Of course, you will have to pay to ship the products and pay import tax. But even if the overall price works out fractionally less, you are still saving. Over time and in increased volumes, you can expect this to be a substantial amount added to your balance books.
When OEM manufacturing in China, many manufacturers will offer you a warranty for a given period of time. This can set your mind at rest when ordering products from across the world. If a product has issues, then you can ask for a replacement or ask for a solution to the problem.
Quick Output and Turnaround
China creates goods for companies all around the world. This means they have scaled up their manufacturing to unprecedented levels. If you need a large number of goods in a short time, they will deliver them.
These factories will have produced similar items to yours before. That means they have all of the procedures in place to get things manufactured quickly and on time.
One of the arguments against this is the unfair conditions of Chinese workers. However, if you research the plant you are using you will be able to find out if workers are paid a fair amount and treated fairly. You should also take into account that the attitude to work in China is culturally different from that in the West.
Manufacturing in China brings with it the exceptional service inherent in their culture. Even for smaller businesses, you will get the same treatment as a larger, global operation would.
This service also carries through to product support. When you contact an OEM manufacturer’s support team, you will get to talk with their engineers. Speaking to their technical team cuts out the middlemen, meaning you can make informed decisions and get great advice on how to improve and refine your product.
By no means do you need to counterfeit a product. However, when manufacturing in China you can specify things you like about one item and have them replicated.
Perhaps you want to include a feature you have seen on someone else’s products or use the same dimensions. By discussing this in advance, Chinese manufacturing companies will be able to arrange this for you easily.
This is how a product evolves. By taking something great and improving, you have the opportunity to make it even better. With each iteration of the item, you can expect the quality to improve as well.
Lead Time Reduction
When you outsource OEM manufacturing to China, you have a number of options to help you reduce lead times. One way is to use automation software to manage your inventory. This will ensure you stay on top of how much stock is needed, ordering at the precise time as you begin to run low.
The other option is to order regularly and consistently. This will mean a reduction in delivery and you won’t miss out when orders run low.
Expansion and Diversification
Outsourcing allows you to add new product lines and verification to your portfolio. This has been something you have been thinking of for a while but did not think possible with your current manufacturers. All of this can be done while keeping prices low and with better production.
This can also help you engage more international markets. You can ship to areas all over the world, allowing you access to markets not possible in the past.
Low Labour Costs
Another of the main benefits of OEM manufacturing is that you gain access to all the best that the company has to offer, including their labor. This means you get expertise without having to search, recruit and train your workers. Not only are labor costs lower in China, but you will not have to pay many of the expenses related to hiring local workers.
If you deal directly with overseas manufacturers, scamming is a possibility. You may find deposits or whole budgets go missing. In addition, even delivered products could be below standard if you have never dealt with the company before.
That means it is important to get a reputable company to arrange this for you. They will have trusted manufacturers who work to the highest standards. In addition, they will have agents who can traverse language and cultural barriers for you.
Now you know the benefits of OEM manufacturing in China, speak with an expert. They will be able to work out the best way for you to benefit. You may be able to improve profit more than you think.
Your first stop should be Shield Works. We are a British company working in Southern China for OEM manufacturing needs. Contact us here and see what we can do for your business.