Why certain Chinese factories prefer NOT to work with third parties like us? (1/2)

by CIL1

Why certain Chinese factories prefer NOT to work with third parties like us? (1/2)

by CIL1

by CIL1

We are located within the borders of mainland China. As an officially registered company in China, we can act equally in comparison to any other local company. Because of our registry and location within China, we bring more weight to the table than a foreign company located outside of China ever could. As a foreign company, you have practically no options to make use of local laws and organizations. It is difficult to operate within China which is one of the many reasons you are not able to defend your interests properly.

Factories know that you can’t defend your interests until a level that would hurt them. They experience a situation in which they feel untouchable. The foreign company is almost not able to do anything if a factory doesn’t deliver according to agreements made. 

Because we are an officially registered company in China (WFOE) the factory knows that we can defend interests properly. It loses its untouchable position. The distance between the factory and the foreign company suddenly doesn’t exist anymore. Making their position less comfortable and forces a factory to handle agreements with more care. 

Defending the interests of the buying party in China

Factories know that a third party like us defends the interests of the foreign company. Meaning in their eyes that we would be less cooperative in solutions that mainly serves the profitability of the factory. We demand that delivery will be according to the agreements made instead of what suits the factory’s profit. It makes operations for manufacturers more difficult and complicated, but it’s leading to more result for you as a foreign company in China. 

Switch and intervene fast within China

At the moment a situation or process requires intervention and fast action, we can help you to do so within China. A third party like u scan directly contact a factory and be at a location within a limited amount of time. Due to this capability, factories can’t easily walk away from their responsibilities. Manufacturers like to be in control of situations that can influence their profitability. They can walk away from their responsibilities by manipulating you in a way that you understand they will not deliver according to what they agreed. Think about creating time urgency to push you to accept certain quality failures as proper solutions are time-consuming. Think about hiding reality about their factory or that a product is manufactured somewhere else at a less qualified factory. In these kinds of situation, a third party like us can act directly. We can bring control back to you as a buying company. In this situation, factories are obviously not happy to work with a third party like us. However, using us will lead to more transparency and profitability for you. 

Factories prefer direct lines

Some factories do not prefer to work with third parties in between communication. Mainly because these third parties have more knowledge about China and the factory their working way. Many Chinese factories tend to not solve a problem by seeking an effective solution but focus on convincing the client to accept a certain problem. Factories in China have a strong focus on finding reasons why an issue for the client is not a problem or that the origin of the problem is out of their powers making them not able to solve the problem.  

A third party knows and recognizes the way how factories work. We, as a third party, do not fall for any of the mentioned strategies of these factories. By recognizing these strategies and acting defensively towards such kind of actions you make it difficult for factories to have issues and problems due to their performance being accepted by the buying party. Therefore, some Chinese factories prefer to have direct lines with clients to avoid any involvement of a third party. To create a higher success rate of their strategies benefitting their profits.  

Many factories also tend to prefer direct lines with clients to be easy in contact with them. Easy contacts create the possibility to easily settle agreements by a phonecall. However, within mass production, order values are high. Issues and problems within mass production represent a possible high financial damage for the buying party. It is in the interest of the buying party to overthink a certain problem or solution for a moment, instead of settling it fast by phone. However, for the factory its beneficial to try to quickly push a solution through by phone before the buying party had time to properly think about it. Fast solutions in direct lines also erase the time and possibility to have a second opinion of a third party about the situation and solution.