Should a small startup, dealing with electronics, go factory direct?

We manufacture electronics and deal with Chinese companies to buy electronic items. We are still in the beginning stages almost, so how can I benefit from the subject matter under the title “Too small to go factory direct”?


Thanks for your email and congratulations on your new business and dealings with China. You asked how to benefit from the article “Too small to go factory direct?”

I think the article was suggesting that new buyers should ask themselves if they have the minimum financing in place to cover the costs of essential items like 3rd party QC and Auditing. Because, as the article says, QC is so important, if you can’t afford to do the audits and inspections on your own in China or via a 3rd party, then the buyer is probably too small to go factory direct. 

If the article helps some small buyers realize they are too small, then it is helping them save money because they would probably end up losing a lot more money in bad quality and failed China sourcing if they try to move forward without enough budget to do the basics.

Suppliers will make it sound like China sourcing is easy and no need to do audits and inspection.  However, in my experience, sourcing is not as easy as the suppliers would like you to believe and it is an industry full of dangers for small or new buyers. So while the message of the article may scare some small buyers away from doing business in China, these small buyers should feel lucky that somebody let them see the truth upfront so the buyer can make an educated decision to deal direct with China or not.

Thanks again for your question and best wishes on your sourcing program!


Mike Bellamy

Chairman of the Advisory Board, China Sourcing Information Center

China Operations Director, PassageMaker Sourcing Solutions

Author, “The Essential Reference Guide to China Sourcing


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