Hiring the right Chinese suppliers plays a crucial role in the quality of your products. The only problem is making the time and effort in searching for credible suppliers. If you have limited knowledge of the Chinese market, you are bound to choose the wrong suppliers which can be detrimental for your business. Here is where sourcing agents can step in.
Sourcing Agents Are a Boon for Businesses
Many businesses turn to overseas manufacturing as it keeps their labour costs down and improves their profit margin. If you look for a China sourcing agent for UK, the internet will give you a lot of options to choose from. You can then research the agents and hire the ones that best suit your preferences.
When you plan to source from countries such as China, there are lots of complicated processes involved that can prolong your hiring process. Sourcing agents are experienced in such matters and know their way through the legal systems. In addition to this, they are proficient in the local language and can act as a mediator in resolving issues.
Now you might wonder why you would want to hire sourcing agents when other options might be available to you. Some of the reasons include:
- They can quickly help you find the right suppliers
- They even conduct audits and on-site visits
- They can help overcome the language barriers and help with negotiations
- They will conduct factory visits, do a quality check for the products and share the reports with you
- They even help deal with the shipment and deliveries of your orders
- They might even offer value-added services like customization of products and packaging solutions
- If you go for high-end sourcing agents, they might even promote your products on many of the popular e-commerce platforms
When you are looking for a China sourcing agent for UK, you need to tread carefully. There are many frauds and scammers out there that claim to be sourcing agents, but will easily dupe you. Here is where you might need to identify the red flags by asking proper questions such as:
- How long have they been in business?
- How will they get paid?
- How often would they visit the factories?
- Will the quality inspection be conducted by them or by third parties?
- How often would they share the reports with you?
- What precautions are taken by them if the suppliers fail to deliver on time?
- Do they have any offices in China?
- Can they share referrals or testimonies from their customers?
- Are they certified and registered?
So how do you know whether you have found the right sourcing agent? Your sourcing agent will make you feel comfortable. They will go out of their way in helping you get the right supplier for your products.
They will have a proper plan in place right from the logistics to the customs clearance. They might even give you suggestions and advices on emerging opportunities that can help boost your production. Last, but not least, they will have no issues if you suggest for third-party inspection companies audit the quality of your products.
Certain red flags to look out for when it comes to sourcing agents include:
- They will be disorganized and might not go and verify the suppliers
- They might bring in their friends or relatives who might have contacts to the manufacturer to become your supplier
- When things go wrong, they will automatically side with the supplier rather than your company
- They might not conduct sample checks and if issues are found, they might not disclose these to you
If you notice any of the above mentioned red flags with your sourcing agent, you might want to terminate your contract and find yourself another sourcing agent.
Charging Models with Sourcing Agents
When you have finally hired China sourcing agent for UK, you need to ensure that they are in line with your requirements. It is always better to sit with them and go over your contract, the payment mode, and other documentation.
Some of the common charging models with sourcing agents include:
- Hourly rates
- Flat fees
- Commission basis
The hourly rate refers to paying your sourcing agent on an hourly basis for their time and effort spent on searching for Chinese suppliers.
Flat fees are a fixed charge paid to sourcing agents. Your sourcing agent will locate the supplier, verify their credential, shares your requirements with them. After negotiating and finalizing the supplier, they will hand over the details to you and charge a one-time fee for their services. This can be per product basis, or for a fixed period.
Commission basis as the name suggests sourcing agents might charge a certain percentage of commission depending on your product or orders.
There are certain things that you might need to trust your China sourcing agent for UK with. This can be a bit of a drawback since you will not have complete transparency and would have to rely on your sourcing agent for details. Some of the common scenarios include:
- You will have no control over the prices negotiated
- Your sourcing is your only means regarding the prices and they can include their commission and come up with the final quote
- Your sourcing agent will only get paid once the orders are shipped
- This can lead to putting pressures on suppliers leading to poor quality products
- In some cases, your sourcing agent might withhold supplier information from you
Sourcing agents are not required for all businesses. Certain businesses have excellent networking and get find reliable suppliers for their products. The services of sourcing agents are required if:
- You are new to the imports business
- You are looking at diversifying your business
- If you are planning to create a niche market by supplying only one product line
- If you are into wholesale business and deal with bulk orders
Hiring sourcing agents in China proves to be advantageous especially if you are a newbie. You can leave all the legal hassles involved in the supplier hiring process with your sourcing agent and concentrate on the operational part of your business.