What About Rising Costs in Manufacturing?

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Because of newer labor laws, increased environmental protection standards and reductions of export tax reimbursement, many factories and some entire industries are leaving the Chinese coast and moving inland or even outside of China. Moreover, many factories on the Chinese mainland are facing intense cost pressures and some industries have already or are planning to make a move into alternative production bases.

Yes, Yes, Yes!

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If you’ve done any business directly with Chinese manufacturing plants you know that you hear the word “YES” quite often. Unfortunately, yes doesn’t always mean yes. I have had countless reminders that in China, that word may not necessarily mean that they agreed with you or even understood what you are asking. It’s similar to when a person goes on vacation to France and only understands a little bit of French so they say “oui” to pretty much everything! The difference is that a simple conversational misunderstanding on vacation is no big deal but a misunderstanding in the world of overseas manufacturing can be financially disastrous. One of the major benefits to using a reputable and experienced sourcing and import company is that the chance for misunderstandings (and financial loss) is greatly diminished. However, if you are considering the option of trying to import yourself, here are some critical guidelines to evaluate.

A Little Thing Called Deming's Law

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Basically, Deming's law states that it costs $1 to fix a quality issue before the product leaves the factory, it costs $10 to fix it in the warehouse after it leaves the factory, and costs a compounded $100 to fix it once the customer has it.