How to lower my exposure to risk when sourcing?

We have to make a 30% down payments to some suppliers in China against orders. How can it be secured and how to guarantee delivery of goods?

The answer to your question has two parts.

How to find the right supplier in the first place to ensure they are a legit seller and not a scam or under-performing vendor?

After the order has been placed, how to verify that the goods shipping are to your quality standards.

Here are links to videos and short articles that will answer these two fundamental questions with authority.

Video 1: Finding Suppliers

Video 2: Evaluating Suppliers

Video 4: Project Management and Quality Control

Video 8: Avoiding Scams

Essential sourcing skills: Supplier Verification

If you only take away one thing from the above resources…be sure to link the supplier’s performance with your payments.  In other words, don’t make the final payments until the terms of the contract (quality, delivery…) have been completed.  And be sure to verify quality with an independent party before the goods ship out of China.

If you would like introductions to China based companies that can help you manage your supply chain in a more efficient fashion, please check out where I keep a list of endorsed service providers who have done a good job for me on similar cases.


Let me know how things work out for you.


Question answered by Mike Bellamy.

Advisory Board Member & Featured Blogger at the not-for-profit China Sourcing Information Center ( Author of “The Essential Reference Guide to China Sourcing” and founder of PassageMaker Sourcing Solutions.

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