Global outsourcing has evolved at a rapid pace over the past decade, and western companies are increasingly choosing low cost countries such as China for finished goods and components at unbeatable prices. Purchasing from China has allowed businesses to increase their international competitiveness and most importantly, focus on their core business. Quite simply, outsourcing allows businesses to focus on marketing and sales, while their outsourcing partners in China take care of product development and manufacturing.
Over the past few years, China has been praised as the “factory of the world” and it has become an appealing option for any business seeking cheaper raw materials, semi-finished and finished products with the goal of improved profit.
Why is China a Leader in Outsourcing?
One of the main reasons that China has emerged as a global outsourcing leader is the experience and education the country has in delivering products that adhere to the rigorous standards of western legislation and consumers. China’s labor is also significantly cheaper than Indian markets for example, where rapid inflation is hindering growth.
Outsourcing vs. In-House Manufacturing
There are many advantages to outsourcing when compared to in-house manufacturing. Business schools across the globe teach us that we should always focus on our core competencies. What does this mean? It means that you should consider the advantage that your business has over its competitors. Perhaps this is an idea for a product. Maybe it is your ability to offer cost-effective solutions. Or, maybe you have an intricate understanding of a certain sector or demographic. Whatever it is that your business has core competencies in, you should highlight them in what you do in-house, and outsource the other aspects of the company. For example: Why are you spending time focusing on manufacturing when that time could be better spent on sales, marketing and business development.
Outsourcing can be a great source of profit for your company when you consider the cost savings in materials and labor, and pair that with the timesaving that allows you to focus on your growing business.
Here are some questions to consider when deciding to outsource:
- Is your company moving into a market where it lacks experience and skill; is it an area outside your core competencies?
- Do you lack the resources needed to increase manufacturing capacity to respond to increased demand or to accelerate product time to market?
- Will outsourcing help mitigate the initial investment and risk involved in entering a new market?
- Will outsourcing help ramp-up time of a newly released product?
- Are you a start-up company that needs to add resources to meet high engineering demands?
If the answer to any of these questions is yes, then, outsourcing may be the best choice for you.
Outsourcing Partners in China – How Sourcing Experts Can Help
Recognizing the need for outsourcing partners in China that can assist western companies in finding quality manufacturers in China, sourcing companies have the ability to assist you in making the transition to outsourcing as smooth and successful as possible.
- An experienced outsourcing partner can help you find reliable Chinese manufacturers
- They provide management of the end-to-end manufacturing and sourcing process
- They will be your eyes and ears on the ground, providing complete on-site support
- They deliver quality inspection services and complete logistics solutions
When you choose to partner with an outsourcing expert like our team at Trans-Pacific Facilitators, they can help you avoid the common pitfalls associated with outsourcing and can ensure that you receive the quality product you paid for.
Outsourcing can be a powerful tool for any company. Whether you’re looking to speed up the time to market of a new product or simply want to enjoy the cost savings, choosing the right outsourcing partners in China is key to your success. Ensuring that this is an effective tool, and not one that turns into a nightmare, requires asking some critical questions at the beginning of the project. The initial time and investment involved in getting the answers can mean the difference between a successful project and an expensive failure.
We’ve put together a list of some of the best questions to ask regarding outsourcing and think you’ll find them most useful.
Are you thinking about finding outsourcing partners in China? Contact our team at Trans-Pacific today to learn more about the many ways we can assist you in finding the manufacture that best suits your needs and product requirements. Connect today!