I have met several small businesses in the UK who are excited about sourcing products and raw materials from China to sell in the UK, but are nervous about the perceived risks. Yet they could learn a lot from the many successful SMEs already harnessing the power of global trade by making the most of the huge possibilities in the country.
The vast size of China can be intimidating for companies concerned about possible pitfalls, or those simply unsure about where to start. Yet scale breeds opportunity – and China most definitely has it. The country is already the world’s second largest economy and now also stands as the largest manufacturer on the planet, with growth in the sector having accelerated even further in recent months. As the economy moves ever faster towards truly global trade, more and more UK companies are acknowledging the benefits of sourcing, manufacturing and building supplier relationships in a thriving market.
This is evident from the fact that the UK is now one of the largest and most active buyer markets from Europe on Alibaba’s B2B cross-border marketplace Alibaba.com, which is set up to enable businesses in the UK to work with safe and reliable Chinese manufacturing partners. It also helps to cut out the middle man and simplify transport and delivery for you. Such platforms exist to clarify the process of trading with China and offer support, dispelling concerns small business owners may have about being left to fend for themselves.
When working with Chinese manufacturers, there are common concerns about quality, as well as logistical issues around shipping and quality control. Trade Assurance Policies exist to ensure you get the standards you’re looking for. These can ensure a business is protected throughout their manufacturing journey on quality, payment and on-time shipment. For example, Alibaba.com has a policy that guards against any problems during the manufacturing process. This policy clearly ranks suppliers so that businesses know that they are sourcing from reputable places and even offers a refund if it is not met to the service level agreement put in place.
There are numerous other benefits to working with these manufacturing partners. Quality products are matched by cost-efficiency and streamlined processes, whilst they have a flexibility and ability to work to really tight specifications. The fact that they have an understanding of local markets means they are expertly placed to advise on materials. They are also aware of the best marketing tools and platforms available for you to use, and understand logistics and regulations. All of this can lessen costs, whilst dramatically reducing the time and effort spent on planning and production.
Going international to help grow a business can be daunting – having a reliable manufacturing partner who is engaged and passionate about the brand is invaluable, making the entire process smoother, reducing the weight on the shoulders of those in the UK and allowing them to focus on getting their product right. Fashion firm Gandys is one company that has been sourcing their products from China via Alibaba.com since its inception. They have cited how using the platform has helped in terms of time and budget when finding the right supplier for products that now fly off the shelves at the likes of Selfridges and Accessorize.
A further challenge brands consider is establishing their Minimum Order Requirements (MORs) and the costs they might entail. In the UK, these are often very high, meaning it can be harder to get your physical product without significant investment – something that isn’t ideal for smaller businesses with naturally smaller pockets to dip into. However, in China there are options available to help you find MORs that do not require substantial investment. For example, Garcon Wines, inventors of the world’s first full-sized postable wine bottles, used Alibaba.com to receive several proposals that offered MORs that were 90 per cent cheaper than what they received back home.
Brands in the UK are looking to find the most efficient and cost-effective way to enhance their respective businesses. That’s why increasing numbers are throwing themselves into the vast pool of opportunity in China – not just to sell to consumers hungry for foreign products, but to source them – attracted by an intoxicating combination of scale, demand, cost, quality and support.
As the world gets smaller, the opportunity to do business anywhere simply gets bigger, something we’re focused on at Alibaba. The chance to source high volumes of quality products and raw materials from China is one the UK’s smaller businesses should be determined not to miss out on.
Stephanie Gao is head of B2B marketing for Alibaba UK
Further reading on China
