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Frequently Asked Question

Frequently Asked Question

Home - Frequently Asked Question

1, What do I need to know about approaching a Chinese manufacturer independently

Overcoming the barriers of language and culture can be a challenge. Trade negotiations are often drawn out and should be begun several months before you plan to start trading or manufacturing. In fact, your first couple of meetings with your supplier will usually be ‘getting to know you’ sessions. This is because business relationships in China are built upon friendship and trust, hence the saying ‘no friendship, no trade’. The good news is that, when you have successfully nurtured such a relationship, you can expect it to be a long lasting one.

A Chinese native and native language speaker is regularly offered a more favourable price than non-Chinese westerners. This is often because an outsider simply does not have the opportunity to get to know the supplier. In our experience, this could mean a difference of up to 25 percent between the unit cost price we are offered and the price our client was given when approaching the same supplier independantly.

2, I am a business in the UK wanting to import from China. If Gigabiz acts as my import agent, how does it work?

We deal with manufacturers on your behalf, and secure the best price, quality and terms available. Once you are happy with the price, quality and, where applicable, samples, you will need to raise a letter of credit payable to ourselves, or to the manufacturer depending upon the model we negotiate. Once this is in place we will place the order with the manufacturer. For repeat orders we will continue to act as your broker with the manufacturer.

3, How we charge?

We can match our payment model to suit your requirements.

We can, through our extensive network of approved manufacturers, incorporate our costs into their price or alternatively we can charge our client (you) a percentage of the cost of goods to be agreed upon.

If you require us to get involved in negotiations over design, specifications and so forth then we will charge a fee to cover this.

We will in all cases inform you of all costs and commissions.

All charges will be agreed with you before any work commences so there will be no unexpected invoices.

4, What are the purchasing channels for doing business within China?

As you are a foreign company, products which originate in China currently reach you through several purchasing channels, almost all of which involve commission being added to your cost of goods - even if you believe you are dealing directly with a factory, this does not necessarily mean that this is so.

Other companies currently source through the expensive gateway of Hong Kong or, as an outsider, get charged premium rates for their goods. This is because there is very often a significant difference between the prices manufacturers charge to native customers and those they charge to foreign ones. The difference is further exacerbated by membership of, or exclusion from, a trusted clique or network of business relationships. With our connections we are already on the inside and can secure you significantly better prices and terms than you could manage independantly.

Gigabiz can, furthermore, introduce you directly to the manufacturers, in order to help you develop an intimate, trusting and long-lasting personal relationship--something that is not to be expected of other third-parties or middlemen, who are aggressively interested in concealing their sources.

5, What business etiquette should I be aware of when working with Chinese companies?

You could do a lot worse here than consulting our consultancy page for more information.

6, Can I get my goods independently inspected?

Yes, there are world recognised inspection companies such as SGS with offices in China who will send an inspector to the factory and produce a report showing how many pieces were sampled, comparing the product against the samples produced, packaging, labeling etc. against your requirements set out in the purchase order.

This is useful to do if you are dealing with a new factory or are buying products which require testing such as electrical goods. Once you are giving repeat orders a full SGS inspection is not necessary.

If the goods are to your specification or require expert evaluation, we always recommend that a technical expert from your company visit the factory to liaise check quality and for future orders it is very useful for the factory to understand your requirements and for you to understand their capabilities. Once again, we emphasise that business in China is built on relationships. (Gigabiz is able to arrange visits, interpreters, flights etc.)

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