Got an email from a client with a link to a list of Chinese manufacturers to avoid. The list is described as an extensive list of companies that scam their customers or mishandle their orders, built up over the last few years. The client wanted to know what I thought of this list. I told him I’d get back to him via a blog post, so here goes.
Count me as skeptical, and here is why.
There are good and bad Chinese product manufacturers and there are honest and dishonest Chinese product manufacturers. There are also good and bad Western product buyers and honest and dishonest Western product buyers. Bad and/or dishonest Western product buyers might threaten to add and then add legitimately good Chinese manufacturers to a list like this, simply because they are mad at the Chinese manufacturer for not giving them the discount they thought they deserved, or whatever. I see that sort of thing all the time.
My law firm must get three requests to sue Chinese manufacturers for every one we actually take seriously. Our international dispute resolution attorneys instantly “toss” many of these requests because the angry Western (usually American) company is the one at fault. How was the Chinese company supposed to know you “needed” your product in 20 days when you do not have a contract that says this and your purchase order made no mention of that? Do you really think your Chinese manufacturer violated your contract by simply seeking to enforce it against you even though your company is going through tough economic times? Is your Chinese manufacturer really the one who should have known the particular requirements for product X being sold in Kansas? I could go on and on.
Just about every time we post on China manufacturing problems or scams, someone leaves a comment saying XYZ Chinese manufacturing company did ___ to them. We delete these comments because it is not fair for a company to be besmirched in such a way, without any sort of independent assessment. I think the same of the above list. How does this list verify its information?
I am not saying such a list is completely worthless, because it probably isn’t. I look at product reviews on Amazon.com (though I am certain some of them are rigged) and I also look at travel sites before choosing a hotel. But, those sites typically have so many reviews that the over-gushers and the overly-furious ones can be ignored. Even then though, I still use the reviews as just one factor in my choice. So I guess I am not saying one should completely ignore something like a bad manufacturers list, but I am saying it should be just one tiny factor in your decision on who to use for your Chinese manufacturing.
For our clients that will be sending large amounts of money to a Chinese company — for manufacturing or otherwise — we recommend a basic due diligence investigation. China has all sorts of good databases that reveal a lot about Chinese companies. This plus a Chinese language internet search on the Chinese company is inexpensive and yet incredibly valuable. If you care about the Chinese company with which you will be doing business, a basic due diligence investigation of that company is in order.
Skip the lists.
