What you should know before manufacturing in China!

The Basics

China is the world's largest manufacturing country. In 2016, it produced $3.2 trillion worth of goods, according to World Bank data.

Manufacturing in China has been a long-standing practice for many companies, with the country becoming a leading exporter of products across a range of industries. This has resulted in many foreign companies setting up manufacturing plants within China's borders to take advantage of its low costs and large skilled workforce.

China's manufacturing capabilities are second only to those of the United States , while its economy is the second largest in the world behind that of the US. With this in mind, there has been considerable growth in recent years and it is expected that this will continue into 2020 when growth is predicted to reach 7 percent annually.

Why Choose China

China is the world's largest manufacturer. In fact, it is estimated that China produces between 20% and 30% of all goods worldwide. It is also the world's largest exporter, making up nearly 15% of global exports.

Many companies are choosing China as a manufacturing location because of its large population, low labor costs and well-developed infrastructure. There are also many reasons why you should consider manufacturing in China:

China produces an array of goods for export to countries around the world. It has been able to do so because it has an abundance of natural resources and cheap labor force. When you manufacture in China, you can take advantage of this by outsourcing your production to local factories that specialize in producing products such as clothes, shoes, electronics and toys.

China offers consumers a variety of goods at a lower cost than other markets around the world due to low wages and low costs associated with production facilities and transportation costs. The average hourly rate for manufacturing workers in China was $1.50 per hour in 2013 which was significantly less than other countries such as Brazil ($3) or Mexico ($2). These low wages allow manufacturers to keep their prices competitive while still turning a profit on their products sold overseas

The Advantages and Disadvantages of Manufacturing in China

For more than a decade, China has been the destination of choice for companies looking to manufacture their products. The country offers low costs and an abundance of skilled labor. Many companies have already made the move, but there are some disadvantages that you should also be aware of before deciding whether or not to set up shop in China.

The advantages and disadvantages of manufacturing in China are very different depending on the type of product you plan to produce. But one thing is certain, if you want to create a sustainable business with a high return, you need to be able to manufacture in China.

pros

Cost Savings

Manufacturing in China can save companies a significant amount of money. This is due to the fact that labor costs are significantly lower than they are in the United States or Europe. In addition, companies do not have to pay as much for shipping since they can ship their products by sea rather than air. This means that less fuel is used and fewer emissions are produced when shipping products across the ocean instead of across the country or continent.

Availability and Quality Control

When manufacturing products in China, there are many different options for finding suppliers who can meet your needs and provide you with quality materials at affordable prices. These suppliers will often have years of experience working with other companies from around the world, which allows them to offer more competitive pricing than you might find if you were trying to source materials locally or from another country where English may not be as widely spoken or understood.

Speed and Flexibility

When manufacturing products in China, it is possible to get your products quickly because there are so many factories producing the same products. In addition, Chinese factories are flexible and can often change their production schedule or adjust to your needs quickly because they understand how manufacturing works. When it comes to sourcing materials for your project, you may need something that is only available in one place in the world. This is where the problem starts. If you are trying to source materials from one country and manufacturing from another, it can be very difficult to get everything in place quickly enough for your project. You may also find that the factories or suppliers are not flexible enough to adjust their schedule or comply with your needs, which could seriously delay production.

Cons

Manufacturing in China is an attractive option for many companies. The country has a huge population, low labor costs, and a strong manufacturing infrastructure.

However, despite the advantages, there are also some disadvantages that you should consider before making the decision to manufacture in China. Here are some of the most common:

Foreign investment restrictions

Foreign investors must partner with a Chinese company to set up a joint venture or invest in an existing company. In addition, foreign companies are limited to 49% ownership of their joint venture or foreign-invested enterprise (FIE), and are forbidden from investing directly in certain industries such as banking and telecommunications. These restrictions may make it difficult for foreign companies to grow independently in China without diluting their brand identity by partnering with local partners.

Language barriers

A language barrier can cause delays in communication between management teams during production processes and delivery schedules can be difficult to maintain due to poor translation skills on both sides. Additionally, Chinese workers may not feel comfortable working directly with international teams due to cultural differences which can also lead to problems with efficiency and productivity levels during production processes.

Slow shipping times

One of the most annoying things about working with Chinese manufacturers is the amount of time it can take to get items shipped from factory to warehouse — or worse, from one warehouse to another. Since most factories in China are located on the opposite side of the country from where you live and work, this means that you're going to have a lot of delays if your product is made there — especially if it contains electronics or other sensitive parts that require testing or certification once they arrive at port. Some companies have started using the Southern California Logistics Airport just north of Los Angeles as an alternative shipping hub because it offers better access to major ports like Long Beach and San Pedro than China does.

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