When looking for suppliers, many importers ask: "Is your company a foreign trade company or a factory?" If the other party answers that it is a foreign trade company, this communication will be difficult to carry on. Most importers have a prejudice that foreign trade companies are more expensive than factories, or that foreign trade companies are equivalent to expensive prices. So, is this really the case? Let's move on to the next.

I. Foreign trade companies

Foreign trade companies themselves do not have a production base and do not produce products, but they provide services. For example, from the customer place to receive an order for extension sockets, then, they go to the factory, get the price, add their own profit points, and then quote the price to the importer. Because of this quotation process of the foreign trade company, many importers feel that this profit earned by the foreign trade company can be avoided directly by looking for a factory.

In theory, this is indeed the logic, but not necessarily in the actual trade process. As mentioned earlier, foreign trade companies are providing services in the process of order making in additional to the price. If all trade is judged by price only, then it is so simple.

There will be a lot of communication links in the process of foreign trade transactions. New product development, design, delivery date changes encountered in the production process, product packaging, all need communications, and are required to communicate information between the two sides of the transaction in a timely manner. The trading company, as a company selling services, will have an advantage in this respect.

In this way, importers with a large range of product lines and more onerous requirements for design, can consider a foreign trade company, because a factory's production range is generally relatively single. Importers who go factory by factory, this manual communication and time cost is very huge.

For example, if you are an importer of home decorations, glass decorative pieces, ceramic decorative pieces, fabric decorative pieces, etc. are all imported product ranges. Many factories in China have a cluster effect, like ceramic factories in Guangdong, fabric factories in Suzhou. It is indeed a very difficult thing for a faraway importer friend to achieve good docking when facing such a large range of distribution. Perhaps the initial transaction price is an advantage, but there are enough problems at a later stage to make your head spin.

This is when you need to find a foreign trade company. A well-established foreign trade company has the following advantages:

• Foreign trade companies have fixed partner factories. Although they charge intermediate profits, the final price may not be higher than the price a new importer would get if he went to the factory side.

• Foreign trade companies that operate in a single category or a single main category, have established or started to establish their own factories in order to better control prices and coordinate production. This also allows foreign trade companies that rely on service and supply chain to dominate, to find a new breakthrough.

• Good service. Can get in touch first and communicate in time.

• Strong coordination ability. Foreign trade companies generally have several factories of similar products on hand. In the event of a factory production problems, they can coordinate production in a timely manner through several other factories.

II. Production Factories

Production factories have direct control and production knowledge of the product, own the raw materials and technology, and can therefore usually offer lower prices, which is a direct reason why many importers choose factories for their transactions.

For importers with a relatively single product category, choosing a manufacturing factory will indeed bring you a boost in profitability business. For example, wall switches and extension sockets belong to the same electrical appliance category of ancillary supplies and the scope of this industry cluster is concentrated. Then, the buyer can directly find the factory for procurement. On the one hand, you can get lower prices. On the other hand, you can get the latest product information of the factory.

The following points also need to be noted in mind when trading with factories:

• Fully understand the factory's qualifications. When cooperate with the factory, check the relevant business license and other information at the first time.

• Pay attention to the communication ability of the factory's business that whether they can understand and provide timely feedback.

• Factory capacity and business ability. When the peak season comes, whether the production can be completed according to the original delivery date, and the after-sales feedback data of the products.

If the supplier you are looking for has done all of the above points well, then congratulations, this is a very good factory that will bring you good prices while being trustworthy in terms of production and service.

III. Comparison Summary

Importers friends now have a further understanding of production factories and foreign trade companies. Then we summarize the advantages and disadvantages of the two contrasts.

Through the table above, we have a few suggestions for importers when choosing a supplier made in China.

• For single category products, look for factories at the source.

• For multi-category products, look for foreign trade companies.

• When working with a factory, it is important to understand the factory's capacity, communication ability and other information, and not just look at the high or low price.

• Cooperate with trading companies, pay attention to their product development and service capabilities.

Importers friends who have procurement needs in the wall switch, extension sockets, LED lights products, you can also consult us. We are located in the product industry cluster belt where there are three corresponding production factories. We’ve engaged in foreign trade exports for 20 years, and we have a very good reputation in the product quality and service. Welcome to enter our official website for more information: https://www.hbsocket.com/.