For example, you may want to customize the crown’s logo to the entire dial for a watch. This can save a lot of time and cost for the factory, including you, because the factory does not want to produce multiple samples because you forget the design details.

Although Mexico’s manufacturing sector has in many ways surpassed pre-NAFTA expectations, the country still experiences stagnant labor productivity. Brazil’s “Operation Car Wash” has revealed some of the illegal dealings that have taken place in the country, but there are several holes that need to be filled or else there exists a very real possibility this corruption will never be completely eliminated. A healthy manufacturing sector is contingent upon transparency in financial transactions, relative certainty in a future a country’s political environment, and individuals being held accountable for illegal action. Every country seeking to improve their manufacturing sector should decrease corruption because Brazil has shown how the ripple effects of such corruption hampers manufacturing growth. In addition, we compiled data on manufacturing output, manufacturing employment, and changes overtime. China is the top nation in terms of manufacturing output and the percentage of its national output that is generated by that sector.

Step #2: How to Find a Factory in China

Read more about Quality Control in China here. When starting an ecommerce business, it’s natural to try and source your products as cheaply as possible. In doing so, you will more than likely find yourself looking at Chinese suppliers on sites like Alibaba and Made in China. If Beijing were to respond to a sharp drop in exports with a sharp rise in government borrowing to fund consumption, once again the contraction in the Chinese trade surplus could be matched with a contraction in Chinese savings. The main way in which this might happen would be if the government (mainly local governments) were to borrow money to fund consumption on behalf of households, such as school costs, medical bills, or higher pension payments.

Onshore spot and offshore forward markets for RMB: Evidence from the “8.11” exchange rate regime reform

Not all China-based manufacturers are unethical and incompetent — though many certainly are. Some are very good… and very busy, which means they are less likely to be interested in a small project requiring a lot of engineering work. Thousands of companies are formed every year to develop and make new products, they are not “China-ready”, and they have the confidence to go at it without proper advice and support. Sometimes they find a way to get some products to market and get some oxygen. When they have run out of funds and there is no clear path ahead, it is often wiser to admit defeat. Inspections help verify whether products meet quality requirements and comply with regulations or relevant product safety standards.

Over the coming years, Chinese authorities will continue to refine the system and draw on a pool of thousands of promising firms to advance its technological capabilities in key areas. There is no guarantee that China will succeed in any particular product or sector, and as shown above, the system has its flaws. Yet in many areas, SMEs aligned with national strategic objectives will gain a significant boost thanks to Beijing’s new industrial focus. Foreign firms will need to continue to innovate and deepen their own competitiveness to stay ahead. The blurry lines between private ownership and state backing will make it difficult to hold China accountable and ensure a level-playing field. Foreign firms will likely be reluctant to challenge the preferential treatment granted to government-certified SMEs for fear of retaliation and therefore need to rely on the efforts of their home governments to advocate on their behalf. However, the new system of state support is in large part opaque, given the incorporation of further market mechanisms and private actors.

A few years ago, Pramod’s Chinese supplier suggested an alternate method which some European manufacturers had perfected. The Chinese partner designed and manufactured the machinery needed for this process and installed it at Pramod’s India factory. His Indian competitors have not been able to duplicate this process in spite of years of trying. This is one of the reasons why Pramod believes that even in relatively simple manufacturing operations, the skill levels of Chinese are much higher than that in India. Chinese employees and entrepreneurs learnt from this experience and built local companies. One important way this support was provided was by making sure that their inputs were cheap.

This is mainly the case for manufacturers who use parts that they import from Chinese factories. When are you ready to begin your own product sourcing with Chinese suppliers? We can get started immediately and find you the perfect manufacturer.