In this blog, we will be looking at importing from China: advantages and potential risks. There is a lot that can be gained when importing from the world’s leaders in manufacturing. If you’re deciding whether importing from China is the right investment for you, this blog is a good place to start!
Why Companies Choose To Import From China
China has previously been coined ‘the world’s factory’. And it doesn’t get its title without reason. In 2022, Chinese exports equated to the value of $3.73T, making it unquestionably the world’s biggest exporter.
Since China embraced the global market in 1979, they’ve continued to gain significant economic power, in terms of manufacturing and purchasing influence.
Many of the world’s global brands have moved their resources and manufacturing facilities to China, so they too can benefit from China’s low production costs.
China’s population means it has a very large workforce. This leads to relatively inexpensive wages, as well as a huge market to sell products to.
The rapid production of mass-market products helps businesses to maintain their competitive edge, as it enhances supply chains and ensures stock is always readily available.
Businesses that have outsourced their manufacturing processes to China have improved their productivity, as they can solely focus their resources on market research and development.
Importing From China: The Advantages
Reduced Costs
One of the main advantages of importing from China is reduced manufacturing costs. Importing from another country accrues its own costs, which must be managed closely to ensure profitability.
Companies that can reduce their liabilities, while maintaining consistent product production tend to be more profitable.
As the world’s greatest manufacturer, China can offer affordable prices to global importers. This allows businesses to price their products competitively.
Range & Quality Of Products
China doesn’t just specialise in manufacturing one product. From textiles and machinery to consumables, electronics, and consumer goods. They can really do it all.
There aren’t many limitations to their manufacturing capabilities, so a diverse range of businesses can capitalise on their resources. Alternatively, a singular business can extend its product range to virtually anything. Through alliances, Chinese manufacturers will customise products, meaning businesses can diversify and tailor their products.
Despite the myths out there about the ‘made in China’ label being an emblem of poorly made products, this is simply not true. Yes, there will be some quality issues, but that could be said for any mass manufacturer.
For the most part, Chinese exports are of higher quality than competing Asian manufacturers. As a whole, their quality has drastically improved due to the demands of European markets.
Scalability
While you would think it’d be unattainable to meet the demand of global importers, China’s manufacturing capabilities make it possible. China houses 2.8 million production plants. They are accustomed to mass production, so scalability is not a concern.
Importers who choose to partner with manufacturers in China can rely on their consistent supply chain, which reduces the risk of stockouts and customer unrest.
Innovation & Technology
When importing from China, you are granted access to their advanced manufacturing technology. China is acclaimed for making significant progress in electronics, renewable energy, and telecommunications. Their access and innovations provide businesses with cutting-edge products.
The juggernaut that is Chinese manufacturing also means they are equipped to bring forth new innovations faster. Businesses that import from China tend to be one step ahead, consistently giving them a competitive edge.
Importing From China: The Potential Risks
Hidden Costs
There are a number of hidden costs associated with shipping from China to the UK. It could be in relation to shipping, suppliers, customs taxes, duty, or insurance.
Some other shipping companies do not provide comprehensive quotes, which detail all the direct and indirect costs associated with importing from China. This can have damaging effects on businesses that are blindsided by unexpected billings.
That’s why, at Shippo, we include all relevant costs with getting your shipment from A to B in our quote. We would rather our bill initially seem higher than our competitors, so our customers can make fully informed decisions with no surprises down the line.
Communication Barriers
As a society, we have improved by leaps and bounds when it comes to global communication. Technology has made it possible to contact anyone, at anytime, anywhere.
However, there is not much that can be done about time differences or language barriers (for now – no doubt Apple or Google have something in the works). Communication can sometimes be challenging with manufacturers based in another continent.
As part of our shipping process at Shippo, our local overseas agent will contact your supplier to organise collection and shipping. We’ll take care of the international communications, so that’s not something you will need to worry about.
Damage/ Loss/ Breakage
There are a number of risks associated with sea freight and importing from China. Transporting a shipment from China to the UK, undoubtedly, requires a lot of movement and handling. Accidents can happen, environmental disasters may occur, and the threat of theft must always be monitored.
There are also risks associated with the specific type of shipping, such as FCL or LCL. When it comes to LCL shipping, your cargo is sharing a container with other shipments. If another shipper has not properly packaged their goods, leaks or spills could threaten your cargo so it’s important to ensure your goods are packed correctly to minimise damage. You can read more on risk management for your LCL shipment here.
Upon your request, our team at Shippo will help arrange marine insurance for your shipment. Knowing that you’re covered will give you peace of mind. We even have an online marine insurance calculator, so you can get an estimate of the costs in advance.
Importing From China With Shippo
We hope this blog has been a useful guideline to ‘Importing From China: Advantages And Potential Risks’.
When choosing to ship with us, it’s our priority that you get to enjoy all the benefits of importing from China and any potential risks are managed and minimised.
Of course, we ship from China, but we also ship from other major ports across Asia. If you’re interested in learning more about ‘Importing From China: Advantages And Potential Risks’, or would like to get a quote, then contact us today.