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newstinxahoi · 5 years ago

Text

Doanh nghiệp nhỏ bấp bênh trong dịch bệnh

Trung Quốc Hôm nay, nhiều nhà máy mở cửa lại nhưng nhiều doanh nghiệp vừa và nhỏ thì lo "chưa chắc có đủ nhân viên quay lại làm việc".

Khi chính quyền Trung Quốc đang ra sức ngăn chặn nCoV lây lan thì đó cũng là lúc Fabien Gaussorgues đang vật lộn để Agilian Technology tiếp tục hoạt động. Đây là một công ty sản xuất hàng điện tử tiêu dùng cho các khách hàng doanh nghiệp nhỏ ở Bắc Mỹ.

Là CEO nhưng Fabien Gaussorgues cũng không chắc chắn 80 nhân viên của nhà máy sẽ quay trở lại đầy đủ sau kỳ nghỉ Tết Nguyên đán kéo dài. Ngay cả khi làm được việc đó, ông cũng không thể đảm bảo quy trình chất lượng vốn có và không thể chuyển hàng đi cho khách, vì rất nhiều chuyến bay từ Trung Quốc đã bị hủy.

"Chúng tôi đã lưu ý khách hàng rằng việc vận chuyển hàng không là không thể trong vòng 3 tháng tới", ông Gaussorgues nói. "Các nhà cung cấp không thể cam kết bất cứ điều gì lúc này. Đó là nguy hiểm số một. Nó có thể buộc chúng tôi dừng sản xuất", ông nói thêm.

Tình cảnh của Agilian Technology là một đ��n cử cho các thách thức mà các doanh nghiệp tại Trung Quốc đang đối diện khi cố gắng hoạt động trở lại sau mùa Tết, nhưng gặp phải dịch viêm phổi. Các khu vực bị phong tỏa, hạn chế đi lại ngày càng nhiều, khiến các nguồn cung cấp nguyên vật liệu sản xuất bị tắc nghẽn. Người lao động cũng di chuyển khó khăn.

Agilian Technology là một trong số các doanh nghiệp vừa và nhỏ hoạt động tại Trung Quốc gặp khó vì nCoV. Ảnh: F.G

nCoV là đòn giáng mới nhất vào các doanh nghiệp trong nền kinh tế sản xuất lớn nhất thế giới, vốn đã bị tổn thương bởi cuộc chiến thương mại với Mỹ năm ngoái. Sự gián đoạn sản xuất dự kiến ảnh hưởng đến các công ty thuộc mọi quy mô, bao gồm cả nhưng gã khổng lồ như Apple và Qualcomm. Tuy nhiên, các doanh nghiệp nhỏ đặc biệt dễ bị tổn thương.

"Đột nhiên, một mối đe dọa lại ập đến. Nhiều tổ chức đang tính toán lại chuỗi cung ứng của họ", Renaud Anjoran, CEO Sofeast, một công ty về đảm bảo chất lượng và kỹ thuật tập trung vào thị trường Trung Quốc, nhận định. Ông cho rằng, hàng nghìn nhà máy nhỏ và vừa tại đây có thể đóng cửa bởi cú sốc này.

"Thật không may, điều này sẽ ảnh hưởng đến việc sản xuất và giao hàng của chúng tôi", Janice Wang, CEO của Alvanon (New York), cố vấn cho các nhà sản xuất bán lẻ và may mặc bao gồm Under Armor, hoạt động tại Thượng Hải. "Chúng tôi dự đoán hàng hóa đã thanh toán của mình sẽ bị trễ trong 4 tuần", ông nói.

Trung Quốc đã cho kéo dài kỳ nghỉ Tết Nguyên đán thêm ba ngày và để hầu hết doanh nghiệp tiếp tục đóng cửa sau đó để hạn chế lây lan nCoV. Nhiều nhà máy dự kiến mở cửa lại hôm nay (10/2) dù không rõ bao nhiêu trong số đó có khả năng. Nhiều lao động vẫn không thể rời khỏi quê nhà để quay lại làm việc trong khi chủ doanh nghiệp vẫn phải chịu tiền lương. Các nhà máy mở cửa lại có thể đạt năng suất thấp hơn do thiếu người.

Nhà sản xuất ôtô Đức Volkswagen AG đã lùi ngày sản xuất trở lại tại một số nhà máy đến 17/2, với lý do thách thức trong chuỗi cung ứng và đảm bảo an toàn cho công nhân nhà máy, khi họ phải đối mặt với các lựa chọn đi lại hạn chế.

"Nếu một số nhà cung cấp chính đột nhiên đóng cửa, hoặc trễ vài tháng trong giao hàng, thì đó là một mối đe dọa chết người đối với một doanh nghiệp", ông Anjoran nói rằng việc chịu thuế quan thêm 10% vẫn không nặng nề bằng tình cảnh hiện tại.

Theo nền tảng phân tích rủi ro Resilience360 của DHL, vận tải hàng hóa nội địa Trung Quốc đang phải tốn thêm 4-5 giờ cho mỗi hành trình khi các xe tải 18 bánh tắc nghẽn tại các trạm kiểm tra thân nhiệt. Vận tải hàng không và đường thủy cũng bị ảnh hưỏng. Kể từ khi dịch viêm phổi bùng phát, hơn chục quốc gia đã dừng các chuyến bay đến và đi từ Trung Quốc. Các hãng tàu cũng ngừng hoạt động. Nhà vận tải CMA CGM SA cho biết đã hủy các chuyến hàng đến cảng Trung Quốc.

Terry Newman, Tổng giám đốc một công ty sàn gỗ ở phía đông thành phố Hồ Châu, không rõ về khả năng vận tải hàng hóa diễn biến ra sao. Ông còn chưa chọn được ngày mở cửa lại nhà máy vì đang vật lộn để tìm đủ khẩu trang cho 25 nhân viên. Việc đeo khẩu trang đã trở nên bắt buộc tại một số địa phương của Trung Quốc.

Các doanh nghiệp trong và xung quanh thành phố Vũ Hán bị ảnh hưởng đầu tiên của dịch viêm phổi. Trong số đó bao gồm cả nhà máy của Hyundai và Hitachi. Sau đó, chuỗi cung ứng trên khắp đất nước bắt đầu bị ảnh hưởng lan tỏa.

Sự gắn bó ngày càng mật thiết của Trung Quốc với nền kinh tế toàn cầu trong hai thập kỷ qua đã thúc đẩy xuất khẩu tăng gấp 11 lần, lên 2.700 tỷ USD trong năm 2018, tính từ năm 2000. Cùng giai đoạn đó, nền kinh tế thế giới mở rộng gấp 2,6 lần. Do đó, thế giới hiện phụ thuộc hơn bao giờ hết vào Trung Quốc đối với các hàng hóa và dịch vụ quan trọng, làm tăng tác động của nCoV với nền kinh tế toàn cầu.

Agilian Technology có trụ sở tại Đông Quan, miền nam Trung Quốc. Ông Fabien Gaussorgues nói với khách hàng là sản xuất sẽ bị ảnh hưởng ít nhất trong tháng này và rất cỏ thể là tháng sau. Trong số 80 nhân viên của mình, ông dự kiến có 15 người sẽ trở lại làm việc tuần này, nếu nhà máy được phép mở cửa. Con số có thể cải thiện lên khoảng 30 người sau đó.

"Kế hoạch kinh doanh của chúng tôi có tính đến những rủi ro như hỏa hoạn nhưng không phải là tình trạng tê liệt cả nước thế này", ông nói sự kết hợp giữa chi phí tăng và rủi ro sản xuất có thể khiến ông cân nhắc rời khỏi Trung Quốc.

"Vào năm ngoái, chúng tôi đã cảm thấy áp lực về việc chuyển đến một quốc gia khác. Chúng tôi chắc chắn thấy áp lực mạnh hơn để làm điều đó vào năm 2020", ông nói.

Phiên An (theo Wall Street Journal)

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rolandfontana · 5 years ago

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How YOU Can Avoid Problems when Manufacturing Overseas

Sorry, But Overseas Factory Problems are Likely YOUR Fault

The genesis for this post is an excellent post written by Renaud Anjoran and a series of Linkedin comments on that post. The post is on Renauds Quality Inspection Blog and it’s called 28 Common Problems Chinese Suppliers Cause Importers. Renaud is the long-term owner of a Shenzhen-based QC+ firm (Sofeast) with whom our international manufacturing lawyers have had the pleasure of working on many China manufacturing projects. If you do manufacturing in China (or even elsewhere), you really should be reading Renaud’s blog.

As per its title, Renaud’s 28 Common Problems post lists out 28 common problems foreign buyers face with their Chinese suppliers. And like so many of the posts Renaud writes, I found myself (last night) nodding my head the whole time while I read it. I then thought it would be helpful to share Renaud’s post on Linkedin so I did, here, with the following blurb: “Not just Chinese suppliers, but suppliers in most other countries are consistently guilty of these 28 things as well. A very helpful piece for anyone manufacturing overseas.”

I woke up this morning to see that Richard Brubaker, another long-time China hand, who too knows China as well as anyone, Left the following comment: “After 20+ years of this conversation, and dozens of book available at any airport in Asia, I think it’s time to reframe this as the 28 ways your process failed you.” Renaud responded to this by saying “absolutely” and I responded to it by saying I 100% agreed. The sad truth is that at least 90 percent of the time, the so-called problem with Chinese or any overseas product supplier lies with the foreign buyer not having taken the right steps to protect itself. In other words, all three of us are essentially blaming “the victim.”

Overseas Manufacturing Problems are on the Increase (Again)

With foreign buyers fleeing China, many factories in China are getting scared and desperate, and their common remedies for that are to cut corners on quality and to take their foreign buyer’s IP and compete with them. We had this to say about the increase in trademark thefts in China Trademark Theft. It’s Baaaaaack in a Big Way:

But starting about a year or so ago, our China trademark lawyers started getting a ton of China trademark theft calls, and the number of those calls has been accelerating ever since. Why has the tide on trademark “theft” come in again? Two reasons. One, there is hardly a soul in China who does not know how to get around the prohibition on an agent registering the trademark that rightfully should go to the foreign company for whom it is acting as an agent. If your manufacturer in Shenzhen wants to secure “your” trademark in China it will not go off and register it under its name, as it knows that cannot work. So instead of registering the trademark under its own Shenzhen company name, it will ask a cousin or a nephew in Xi’an to register it under its company name, making it nearly impossible for you to invalidate the trademark. Two, many (most) Chinese factories are hurting and they desperately want to improve their profit margins. What better way to do so than to sell a product under a prestigious or well-known American brand name — or even just any American brand name? See Your China Factory as your Toughest Competitor.

In China Factory Disputes: The 101, we had this to say about the increase in product quality and other Chinese factory problems:

Many China factories are in deep trouble due to declining sales stemming from the US-China Cold War. I base this not just on the economic statistics everyone is seeing but also on the fact that our China lawyers are getting a steady stream of emails from foreign companies reporting the usual range of problems whenever China’s factories start suffering.

Our international manufacturing lawyers have been getting a ton of emails from foreign buyers that are being pursued by their Chinese factories for refusing to pay for defective products. Typically the foreign company is trying to achieve some sort of compromise while the Chinese factory is insisting on full payment.

There are a lot of huge risks for foreign companies in these situations, and the typical first question we ask a company in this situation is how easily can they just up and move their manufacturing outside China. If they say they can, then we start working with them to achieve that as quickly as possible. If they cannot, we start talking about the sorts of defenses they need to start building.

We then went on in that post to explain what to do if you find yourself in a dispute with your Chinese factory.

With all the problems with China these days, one of the easiest things you can do to avoid or resolve a China factory dispute is to move your manufacturing out of China. See Moving Your Manufacturing Out of China: The Initial Decisions and How to Move Your Manufacturing from China AND Protect Your IP. The risks of manufacturing in China are shooting through the roof these days, and those risks are even higher if you are in a dispute with your Chinese factory. See Has Sourcing Product From China Become TOO Risky? But those risks are also typically at their highest at the beginning of any new relationship with a factory, whether that factory is in China or in Thailand, Mexico, Vietnam or wherever. And in the end, it is really up to you to reduce your risks.

How to Avoid your Overseas Manufacturing Problems

The first thing you need to do to reduce the likelihood of having problems with your overseas product suppliers is to recognize that these problems are mostly on you. I am NOT saying that if something goes wrong your overseas manufacturer will not be at fault as well — because it probably will be — but I am saying that most of the time when a foreign buyer comes to one of my firm’s international dispute resolution lawyers with an overseas manufacturing problem, we find all sorts of things the foreign buyer could and should have done differently that would have avoided the problem or reduced its damage.

We wrote extensively on this in China Factory Problems: Always YOUR Fault?:

The title is somewhat of a stab at humor. It stems from my blaming most (but certainly not all) China factory problems on the foreign buyer. We have written countless times of what is required to secure good product from Chinese factories.

* * * *

We have also written how our China lawyers constantly get calls or emails from American and European companies that have received bad product from their Chinese factory suppliers and how there is nothing we can do for them. We wrote about this just last week in How To Get Bad Product From China With No Legal Recourse. To a certain extent, we like being able to blame the victim in these situations because that way we as lawyers can comfortably sit back and tell ourselves that had they only contacted us BEFORE they started having problems, we could have prevented all of their problems.

Everything written above about China holds true with equal force about your manufacturing pretty much everywhere outside of China, as well.

But what exactly can and should you do to protect yourself when manufacturing overseas? The below six basic things are key.

Use a Good Company. Sounds rather basic, but we constantly see this rule violated. If you do nothing else that we suggest in this post, do this one thing because it matters as much as all the other factors put together.

Use Good Manufacturing Agreements. Good contracts ensure that your overseas manufacturer knows what is required of it and what will happen to it if it does not meet those requirements. For what constitutes a good Overseas Manufacturing Agreements go here. For what constitutes a good overseas Mold Protection/Mold Ownership Agreement, go here. For what constitutes a good overseas NNN Agreement, go here. For what constitutes a good overseas Product Development Agreement, go here. Most overseas manufacturing contracts we see are worthless because they are usually written by someone who either does not know manufacturing or does not know international law, or both.

Use Detailed Documents. Overseas factories that engage in contract manufacturing tend to do exactly what you tell them to do. This means you need to clearly convey what it is that you want them to do, and that means your instructions and specifications should be detailed and in their language. See China OEM Agreements. Why Ours Are In Chinese. Flat Out. Be overly specific.

Visit the Factory. Either your own people or a third party QC company should pay regular visits to your factory. Doing this allows you to make sure your factory understands what you want and lets them know that you are serious about making sure you get it. It also humanizes you and tells them that you really do care and are not just putting things down on paper to look good to your own buyers or to abide by some regulation somewhere. Trust me when I say that this one should not be underrated.

Inspect Your Products. Perform regular product inspections appropriate to the product you are having made.

Register Your IP. If you have IP worth protecting (and pretty much all of you do), make sure you do everything you can within reason to protect it wherever you are manufacturing your products and wherever you sell your products. This means trademarks, patents and/or copyrights.

If you do all of the above your odds of avoiding overseas manufacturing problems go way down. If you don’t do the above, expect to see people blaming you for your problems on Linkedin and elsewhere. Your thoughts?

How YOU Can Avoid Problems when Manufacturing Overseas syndicated from https://immigrationattorneyto.wordpress.com/

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simplyopulentliving · 9 years ago

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Mock Cheddar Bay biscuits. Yo! I'm feeling these. 1.5 net carbs and gluten free. I don't remember where I found this recipe but a quick Google search will do it. Perfection. #SOHealth #SOFeasting #SOLiving #lchf #ketogeniclifestyle

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rolandfontana · 5 years ago

Text

How YOU Can Avoid Problems when Manufacturing Overseas

Sorry, But Overseas Factory Problems are Likely YOUR Fault

Overseas Manufacturing Problems are on the Increase (Again)

With foreign buyers fleeing China, many factories in China are getting scared and desperate and their common remedies for that is to cut corners on quality and to take their foreign buyers IP and compete with them. We had this to say about the increase in trademark thefts in China Trademark Theft. It’s Baaaaaack in a Big Way:

But starting about a year or so ago, our China trademark lawyers started getting a ton of China trademark theft calls and the number of those calls has been accelerating ever since. Why has the tide on trademark “theft” come in again? Two reasons. One, there is hardly a sole in China who does not know how to get around the prohibition on an agent registering the trademark that rightfully should go to the foreign company for whom it is acting as an agent. If your manufacturer in Shenzhen wants to secure “your” trademark in China it will not go off and register it under its name as it knows that cannot work. So instead of registering the trademark under its own Shenzhen company name, it will ask a cousin or a nephew in Xi’an to register it under its company name, making it nearly impossible for you to invalidate the trademark. Two, many (most) Chinese factories are hurting and they desperately want to improve their profit margins. What better way to do so than to sell a product under a prestigious or well-known American brand name — or even just any American brand name? See Your China Factory as your Toughest Competitor.

In China Factory Disputes: The 101, we had this to say about the increase in product quality and other Chinese factory problems:

Many China factories are in deep trouble due to declining sales stemming from the US-China Cold War. I base this not just on the economic statistics everyone is seeing, but also on the fact that our China lawyers are getting a steady stream of emails from foreign companies reporting the usual range of problems whenever China’s factories start suffering.

There are a lot of huge risks for foreign companies in these situations and the typical first question we ask a company in this situation is how easily can they just up and move their manufacturing outside China. If they say they can, then we start working with them to achieve that as quickly as possible. If they cannot, we start talking about the sorts of defenses they need to start building.

We then went on in that post to explain what to do if you find yourself in a dispute with your Chinese factory.

With all the problems with China these days, one of the easiest things you can do to avoid or resolve a China factory dispute is to move your manufacturing out of China. See Moving Your Manufacturing Out of China: The Initial Decisions and How to Move Your Manufacturing from China AND Protect Your IP. The risks of manufacturing in China are shooting through the roof these days and those risks are even higher if you are in a dispute with your Chinese factory. See Has Sourcing Product From China Become TOO Risky? But those risks are also typically at their highest at the beginning of any new relationship with a factory, whether that factory is in China or in Thailand, Mexico, Vietnam or wherever. And in the end, it is really up to you to reduce your risks.

How to Avoid your Overseas Manufacturing Problems

We wrote extensively on this in China Factory Problems: Always YOUR Fault?:

* * * *

Everything written above about China holds true with equal force about your manufacturing pretty much everywhere outside of China as well.

But what exactly can and should you do to protect yourself when manufacturing overseas? The below five basic things are the key.

Use a Good Company. Sounds rather basic, but we constantly see this rule violated. If you do nothing else that we suggest in this post, do this one thing as it matters as much as all the other things put together.

Use Detailed Documents. Overseas factories that engage in contract manufacturing tend to do exactly what you tell them to do. This means you need to clearly convey what it is that you want them to do and that means your instructions and specifications should be detailed and in their language. See China OEM Agreements. Why Ours Are In Chinese. Flat Out. Be overly specific.

Visit the Factory. Either your own people or a third party QC company should pay regular visits to your factory. Doing this allows you to make sure your factory understands what you want and lets them know that you are serious about making sure you get it. It also humanizes you and tells them that you really do care and are not just putting things down on paper to look good to your own buyers or to . abide by some regulation somewhere. Trust me when I say that this one should not be overrated.

Inspect. Perform regular product inspections appropriate to the product you are having made.

Your thoughts?

How YOU Can Avoid Problems when Manufacturing Overseas syndicated from https://immigrationattorneyto.wordpress.com/

0 notes

rolandfontana · 6 years ago

Text

Outsourced Product Manufacturing: Large Company Advantages

In yesterday’s post, On SMEs Trusting China Manufacturers. Don’t. Just Don’t., we wrote about product outsourcing mistakes often made by small companies (SMEs). The same day we wrote that post, The Quality Inspection Blog did a post, 9 Things Only a Large Company Can Obtain in China/Vietnam, comparing what large companies are able to achieve when outsourcing their product manufacturing that small companies cannot.Before I discuss Quality Inspection Blog’s post (by analyzing the nine things it cites) I want to note how true it is. Small companies sometimes read how they should do X with their product manufacturing and then insist on doing X even though virtually no product manufacturer in China or Vietnam or Thailand or Mexico or Cambodia or the Philipines or wherever would ever go along with X unless HUGE product quantities are ordered. Put simply, Walmart can require certain things of its product suppliers around the world that your company cannot.

The first thing that springs to mind is product exclusivity. Our manufacturing lawyers usually ask our clients that are looking to have a product made overseas whether they are concerned with their foreign manufacturer making the same product for others. When we ask the question using the word “same,” and our client responds “yes,” we then ask what for them constitutes the same product. Sometimes they will respond with something broad like “I don’t want them making IoT devices for anyone else” When I get this sort of response, my thought is that this is never go to happen unless our client is prepared to purchase billions of dollars a year in IoT devices from this one manufacturer. I say this because most contract manufacturers that make products for small companies make their products for from 3 to 300 foreign companies. No manufacturer that makes IoT devices for 100 companies will stop making IoT products for all 100 companies just to secure your $800,000 in yearly business. The economics of that are just not there.

In this sort of situation, our manufacturing lawyers will usually provide the following sort of explanation as to why what our client seeks is both impossible and unnecessary:

Wait a second. This company you wish to use to make your IoT product. It makes all sorts of IoT products for all sorts of other companies around the world, right? And your IoT product is a health device you plan to sell to health clubs in Canada and the United States, correct? So why do you even care that this company makes and sells IoT devices for olive growers in Spain, Israel and Greece? You don’t care about that do you? I am asking these questions because there is no way this manufacturer is going to stop making IoT devices for olive growers in Spain, Israel, and Greece just to get your start-up order for 10,000 health club IoT devices and I am not aware of any reason why this should matter to you. So how about we just try to get this manufacturer to agree (with China-enforceable NNN provisions) not to make or sell health club IoT devices?

Quality Inspection Blog starts its post by discussing how there is much good advice on “Linkedin and elsewhere, aimed at importers sourcing products from China, Vietnam, or other low-cost Asian countries” but much of this advice is NOT applicable to companies buying under 20 million USD a year — and, sometimes, not under 1 billion USD a year.” It then lists out the following nine things large importers can get from their suppliers but small companies usually cannot. Note that my summary below of the Quality Inspection Blog is in regular font and my own comments/opinions are in italics.

1. Negotiate with large contract manufacturers in many countries. Apple has been looking at producing iPhones in Vietnam and/or in India. Apple knows “large contract manufacturers (e.g. Foxconn) are willing to set up a plant wherever Apple wants.” But if you are a company looking to buy 5,000 mobile phones in Vietnam or India, you very well may not be able to find anyone to make them for you in such a small quantity. This is so true. Our law firm has been working a lot lately with clients looking to source electronic products from Vietnam and Thailand and the Philipines and unless they are willing to buy in fairly large quantities, they are not having much luck in finding suppliers. But much depends on the product and the country. For instance, many of our toy and houseware product clients were able to relatively easily shift their contract manufacturing manufacturing to Vietnam and Thailand.

2. Reserve production capacity for the mid- or even the long-term. Quality Inspection Blog mentions having heard how VF Corporation was able to reserve the capacity of several buildings in Chittagong, Bangladesh. Large companies with mature planning and distribution systems have a good idea about their needs five years into the future and they can often find contract manufacturing companies that will reserve them the capacity to realize those plans. So true, but for a small company this is just virtually never going to happen.

3. Negotiate directly with large sub-suppliers. Li & Fung can reserve greige fabric and dyeing capacity before it knows for certain the colors its massive list of clients will choose. Li & Fung can do this because it has massive buying power and because it is able to talk directly with large sub-suppliers. In many cases, contract manufacturers will refuse even to reveal from where it gets its materials and components to its small company buyers.

4. Open-book visibility about the manufacturing facility. Large buyers are often able to get deep-dive costing information from their contract manufacturers. Things like the “what their supplier pays for rent, per employee, for each line on the bill of materials, and so on. For large buyers such as General Motors or Airbus, this is a given. Any part supplier not willing to share this level of detail is discarded.” Small companies generally should not even bother asking for such information.

5. Force the factory to use your own ERP system. Many tier-one auto suppliers have to use an SAP implementation that perfectly integrates with the SAP implementation used by their buyers. “So, if 50% of a plant’s activity is for GM, 40% is for Chrysler, and the rest is for smaller customers, the plant will need to use 3 different ERP instances.” Small companies often work with suppliers that don’t use ERP at all.

6. ‘Open account’ payment terms. This is much more common for large companies. I am always impressed by small companies that are able to pay 50% or less upfront. For more on manufacturing payment terms, check out China Manufacturing Payment Terms.

7. Product warranty & liability from the supplier. Large companies can get their manufacturer to sign legally-enforceable contracts that make it liable for product warranty and liability obligations and that require the manufacturer to carry liability insurance. “This is pretty much unheard of for an importer buying ‘only’ 500,000 USD a year from a given factory.” I disagree with this statement as we are nearly always able to get overseas factories to sign for good warranties. However, this whole area of warranties and liability insurance is a minefield. How valuable is a warranty if you are working with a manufacturer that has only $100,000 a year in profits? See China Manufacturing Warranties. How valuable is it to get your manufacturer to buy a crappy insurance policy written in Vietnamese? Also, if you require your manufacturer to spend 30 cents per widget for insurance, it likely will just flip around and charge you 30 cents more per widget to cover this cost. Might you not not be better off just buying your own insurance in your own country for 30 cents per widget? See The China Price and Product Liability Insurance: Never the Twain Shall Meet.

8. Shaping the supply chain PHYSICALLY. “You set up a mammoth plant and you don’t want your high-value component suppliers to be more than 1 hour away from you, for just-in-time inventory replenishment? They can be requested to set up a new manufacturing facility next to you.” Small company? No way.

9. Have their own teams on site all the time. “When you develop new products, can you afford to have your own engineers at the main factory, and going around component factories as well? Probably not with the same intensity as, say Apple (who dispatch not only engineers but also supply chain security staff and so on and so forth). In the end, that makes a very large difference in quality & time-to-market performance.” True, but there are a number of very good quality inspection companies, including the company — Sofeast —behind the Quality Inspection Blog. Not quite the same thing as having ten of your own people live in the factory, but a thousand times better than no monitoring at all.

I am going to add a tenth item: price stability. Large companies are often able to get their suppliers to commit to long-term pricing, whereas this is just not possible for most small companies.

So what can small companies that use overseas contract manufacturers do to protect themselves? Go with the basics, as described (at least in part) in our post yesterday.

What are you seeing out there?

Outsourced Product Manufacturing: Large Company Advantages syndicated from https://immigrationattorneyto.wordpress.com/

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