In many countries, the buyer’s references are taken for granted. I mean, how else do you know you can trust a potential supplier. And, after all, this supplier should work to sell themselves to you, not the other way around. Well, that’s how things should go. However, there is a certain difference between how things should go and how, on the contrary, it happens in reality as far as Chinese suppliers are concerned.
In this article, we explain why many Chinese suppliers are not too scrupulous in sharing information about their buyers and why you are part of the problem. We also explain why references are not relevant from the outset when making OEM products.
1. Suppliers fear that their competitors may deal with their customers
Transparency is, for several reasons, a foreign concept to most Chinese manufacturers. When discussing this issue with the managers of the country’s industries, most Chinese manufacturers consider giving customer references as an invitation to their competitors to try to steal customers from them.
And they are right. Considering that many buyers are price-sensitive, suppliers are right not to disclose their clientele to competing manufacturers.
2. At the same time, buyers are not too keen on revealing the names of their suppliers
Imagine seeing your company name listed on a supplier’s website, or on the Global Sources or Alibaba page, and your competitors see it. I bet 15 USD (100 RMB) that you wouldn’t like it.
It is a fact that many buyers force their suppliers not to share any information about their products and not to reveal that they are their customers.
It is for this reason that suppliers are often very limited when it comes to sharing references on buyers. Of course, they are careful not to risk upsetting an existing customer, potentially in the long term, for the sake of pleasing a “possible future” buyer.
3. And, in all honesty, would you associate your brand with manufacturing in Asia?
We have had customers come to us asking us to remove their references, once they found out that our site was visible on Google and someone searched for their company name. They want advertising, but not the kind of advertising that tells everyone that these customers import their products from China.
Personally, I would consider the testimonial on the sites to be a signal that the brand in question takes those customers’ purchases, product safety, and social compliance strategy seriously. After all, we know that their merchandise is produced somewhere in Asia anyway.
That said, I see where they come from. Yet, before you ask your competitors to publicly label their products as “Made in China,” consider whether you’re willing to do so yourself.
4. Ultimately, the buyer’s references are rather irrelevant
Suppliers make products for Disney that, as such, must be “good”. This probably happens when they assemble the merchandise for Disney. However, these providers are not divided between “good” and “bad.” A number of factors must be considered.
Firstly, many providers focus on the different price ranges. What works for a business, may not work for you. Suppliers may not have experience in making the type of product, they may not know the function or quality your business needs. They may not even have the right network of subcontractors.
Secondly, it is true that a “good supplier” (for various reasons, I don’t like to use this term at all) represents the foundation for a company that relies on production abroad. However, finding the right supplier is only half the equation. The second half is based on your product development, product safety, and quality assurance procedures.
Disney has an army of engineers, product compliance and procurement experts who can make it happen. You can’t do that. As such, their positive outcome with a particular provider doesn’t automatically translate to the same outcome for your business.
Third. You are not Disney, so your orders will not be treated like theirs. This means that you will not be able to get as much attention in the production line. As a result, the defect rate can, among other things, increase.
That said, the fact that Disney buys from them is not a bad thing. But it’s not enough to make you make up your mind about a partner manufacturer.
5. If buyer references are not that important, what should we keep in mind when selecting a manufacturer?
The moral is not that you don’t have to ask for buyer’s references. Actually, you should ask for them. And, as Mike Bellamy of Passage Maker said in this podcast (taken from Global from Asia), a good tip is to ask for buyer references that you can’t find in your home market. For example: If you’re based in the United States, ask for references in the European Union or Australia.
On the contrary, here the fact of the matter is that you should not rely on buyer references when choosing a supplier. At best, they’re a bonus. One of the many elements used for the evaluation of manufacturers in China and other Asian countries.
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