81–90 of 94 posts
Earlier quoted context omitted.
> there are all sorts of fun import tariffs and such to deal with (at least on the US side) Hopefully some free trade agreements help eliminate blockages like this in the future.
As if China had any difficulty in selling their products already. Cutting taxes even more to benefit Apple et al, why?
Business in China operates via 'Guanxi' [ http://en.wikipedia.org/wiki/Guanxi ] - which losely translates to a heirachy of: family first, then friends, then people from the same town, then of the same province, then of the same country, and then, the lowly gweilo / white devil.
If you don't have previous contacts or a solid history in China, you fall right to the bottom of the stack - meaning you'll have a bad price, bad negotiation point, low priority in the factory, and ripe for being 'disappointed' with your experience.
Likewise, many people who outsource manufacturing to China hop on alibaba, find a manufacturer with a low per item cost, and think they've cracked East/West trading. Not so. There are many, many hidden gotchyas involved - ranging from child labor, poor conditions, the 'factory' you chose isn't even the manufacturer, to hiden nasties in pricing / shipping, etc.
There is a large misconception that products from China are junk. This is partly true. Some products from China are junk - simply because the Chinese can and will manufacture according to the resale price specified by the buyer - that is to say, you. When you buy a $1 item from WalMart, and you know its price 'should be' $5, you contribute actively to this problem. Want to see a great product made in China? Look at your Apple device.
If you're contemplating doing business or manufacturing in China, there's a few basic things to do to avoid common pitfalls: 1. Visit your factory. Fly over, arrange meetings with 4 - 5 similar factories, and inspect them all. If something seems suspicious, return unannounced to see the reality. This is really, really important. Meeting clients and relations are very, very important in China. 2. Understand / learn how Chinese do business. If you don't have local contacts, consider finding a local broker to do the hard work on your behalf, and negotiate Chinese/Chinese (See Guanxi above). Due diligence here is important. 3. Plan for 12-month development cycles. If you're in a big factory, you're competing with their big clients. Most manufacturers plan in 24-month development cycles, so plan at least in 12 month cycles. This is just common sense. 4. Factor in shipment prices / shipment terms. Learn the difference between EXW / FOB / etc. These make huge diffrences to your bottom line. Remember for production runs to have shipping insurance / liability insurance. 5. Don't fall into legal issues: ensure you know what and how your goods are manufactured. Making toys / figurines? Make sure your factory is certified to make them, or be able to live with the consequences. 6. Be realistic about your MOQ. If you're looking for 5 items, don't look to China - you'll only waste your time and the factory's time.
Like any decision in business, you need to consider what works best for your business.
Source: 30+ years of manufacturing hardware [locks, tools, etc], toys [figurines, plush, etc], and electronics [PCBs, injection moulded cases etc] in China.
I have backed a half dozen Kickstarters and Indigogos that were hardware based (consumer electronics) and chose to manufacture in China. Seeing the time and money they spend in order to fly someone over to China to troubleshoot and issue with manufacturing or testing has left me wondering - why do small startups choose to manufacture in China to begin with? > Is it because they assume that despite the initial cost ov…
Poor pricing decisions.
Most Kickstarters can't get people to fund "Thingit X" if it costs over $100.
Hell, I'd be hard pressed to put a Beaglebone+wacky I/O thingy+software in a case and shove it out at a profit at $100. And I think I know what I'm doing after a couple decades at this.
And, electronics is NEVER the problem for me. I can generally spin 50 turnkey boards in a week for around $5K unless there is something amazingly exotic about the board. That's just not that expensive relative to business costs.
The things that kill are always the mechanicals. Injection molds are $15K plus for a single mold--and there is always something wrong with the first mold. And you probably need at least 2.
And that's just the case. If you need to mount a display or battery or something that's even more molds.
So, I'm above $50K for injection molds without blinking for even a VERY simple product.
The real solution is to make sure your product is above $100 (preferably significantly) so you can actually 3D print the required plastics (which will be around $10 per part). Now, you can tune your plastic parts and you don't have the NRE of molds. After you have everything tuned and have some volume, THEN you can cut a mold. And, you may never cut a mold--you can print over a thousand parts at $10 per part for $10K. How many Kickstarters ever ship more that a thousand of anything?
There's plenty of great manufacturing in the US. Since I'm a software guy, we had one company build us a prototype and handle industrial design (Tomorrow Lab, http://tomorrow-lab.com/; Pepin is a friend) and found an integrated mechanical engineering and manufacturing firm just over the river in NJ (Tech Products, techproductsco.com; Bob is an awesome human being) for the final product and first few real runs.
Having an actual partner we could meet with all the time, understand clearly, and iterate with was incredibly valuable for us. Plus obviously there are important technical integrations (I was writing all the software myself while the ME and EE was happening) and multiple suppliers, and if you're in charge of managing a few bespoke engineers who sometimes don't see eye to eye, you'd better be able to work with them all carefully and personally.
> If you’re based in Germany, there is a 7 hour time difference to east Asia, if you’re based in California, it is 16 hours. No, in California, it's 8 hours (in the other direction). It doesn't make sense to talk about more than 12 hours of time offset except if you really care about aligning the calendar day instead of just the hour of the day.
Earlier quoted context omitted.
Read your own comment. You're basically saying that laser cutting and CNC stitching - operations performed by robots based on files uploaded by computers - are done better in China than here. That's like someone in China saying that we are better at standing. People on both sides of the ocean probably do just fine at both. ;)
> You're basically saying that laser cutting and CNC stitching - operations performed by robots based on files uploaded by computers - are done better in China than here. Not done better. They're not done here AT ALL . That's a big difference.
I have backed a half dozen Kickstarters and Indigogos that were hardware based (consumer electronics) and chose to manufacture in China. Seeing the time and money they spend in order to fly someone over to China to troubleshoot and issue with manufacturing or testing has left me wondering - why do small startups choose to manufacture in China to begin with? > Is it because they assume that despite the initial cost ov…
> why do small startups choose to manufacture in China to begin with? Poor pricing decisions. Most Kickstarters can't get people to fund "Thingit X" if it costs over $100. Hell, I'd be hard pressed to put a Beaglebone+wacky I/O thingy+software in a case and shove it out at a profit at $100. And I think I know what I'm doing after a couple decades at this. And, electronics is NEVER the problem for me. I can generally…
Good points there -- I have a scenario in mind that resembles this example. Do you have a favorite 3D printer for small instrument/device cases? Or do you outsource that work to someone who does?
So, I'm above $50K for injection molds without blinking for even a VERY simple product.
Also, something I've never understood about injection molding is why the hobbyist-accessible CNC revolution of the past 10 years or so hasn't reduced the cost of creating molds. If I do a GIS for "injection molds," it shows me a lot of pictures of things that, although concave, could easily be built by aggregating a small number of machined parts.
A lot depends on the product you are manufacturing, and the relationship you have with the manufacturer. Business in China operates via 'Guanxi' [ http://en.wikipedia.org/wiki/Guanxi ] - which losely translates to a heirachy of: family first, then friends, then people from the same town, then of the same province, then of the same country, and then, the lowly gweilo / white devil. If you don't have previous contacts…
I'll add one word of caution, I've looked into getting a product made that had a textile component and a separate product that had a leather component. Precision, automated stitching is either totally absent or completely unaffordable in the US. There are great shops India and China that can do laser cutting and CNC stitching super cheaply and if you want to make an inexpensive product to tight tolerances this is exa…
Read your own comment. You're basically saying that laser cutting and CNC stitching - operations performed by robots based on files uploaded by computers - are done better in China than here. That's like someone in China saying that we are better at standing. People on both sides of the ocean probably do just fine at both. ;)
A lot depends on the product you are manufacturing, and the relationship you have with the manufacturer. Business in China operates via 'Guanxi' [ http://en.wikipedia.org/wiki/Guanxi ] - which losely translates to a heirachy of: family first, then friends, then people from the same town, then of the same province, then of the same country, and then, the lowly gweilo / white devil. If you don't have previous contacts…
Good points, and another one worth mentioning: watch out for the case where the single unit or small quantity of sample product you order when evaluating a new supplier turns out to be of much, much better quality than the bulk order you eventually place.