Importing From Low-Cost Countries

By Davina Cruella Sandwich

For more years than I have been witness to, companies have been mass-producing their products in Asia, usually in or in the region of Southern China which is now globally seen as the manufacturing capital of the world.

The reason for this is that you get a lot more for your money in China than you do pretty much anywhere else because of the exchange rate, a single unit of their currency (Yuan) is worth far less than a single unit of ours.

And there we have it, pretty much THE reason most products are sourced in China. Cost. But what more reason do you need it it will save a great deal expenditure? There are a few more advantages, and a couple of disadvantages.

There are only a few advantages, but I still think that they by far outweigh the disadvantages. The main one I have already talked about, the price. For every single GBP you get 11.2CNY (Chinese Yuan), so your money really does go a lot further.

Another advantage is the close proximity you gain to their local trading environment. If you can get your company recognised in the Chinese trading industry it can only benefit your organisation. Also there is a good chance that you will end up a lot closer to the raw materials you need to make your product, therefore saving on the acquisition of your raw materials as well.

Now to the disadvantages, one of the main ones is the cost of importing your goods back to your base country. However when you compare the money spent on importing to the money saved on manufacturing, the overall process will still work out cheaper.

Also there's the time that the shipping takes, this could be seen as a greater disadvantage as, depending on level of demand, it could result in loss of turnover. Another disadvantage is that there may be some issues with production quality nearer the beginning of manufacturing as the factory staff become acclimatised to your product, but if you get a good sourcing company to do the communications for you, then you should end up with a high quality production line from start to finish. As well as that, it is difficult to predict what the local conditions are going to be like, financial or otherwise.

In summary, it is my personal belief that sourcing form low cost countries such as Southern China is far more advantageous to businesses than domestic sourcing. - 23159

About the Author:

A great company to do all your import and manufacture with is Red House Global. They have had decades of experience and are well known among the Chinese traders, ensuring you the best price.