“Made in China” is not just a stamp on the products you use on a regular basis; it is a symbol of a huge global economic change. China has become the world’s top manufacturer, churning out $4.66 trillion worth of goods, surpassing the combined outputs of four of the other biggest manufacturing countries: U.S., Japan, Germany, and India.
This is not just a coincidental development; it is a testament to China’s very smart and strategic planning.
China’s “Edge” Manufacturing
One of the things that China got a headstart on is industrial manufacturing. They did it at such a massive scale, for better or for worse, which has given them a distinct advantage at industrial scale manufacturing and handling mixed batch sizes compared to their competitors in an “efficient” manner.
The rest of the world has a lot of catching up to do. Other countries must figure out how to match that efficiency, particularly by developing more effective, localised supply chains that can quickly serve local markets.
What factors fuel China’s incredible growth?
- Skilled and resilient workforce
China’s biggest asset? Its people. China’s enormous population provides a huge, affordable labor pool that is increasingly proficient and incredibly skilled at basically everything from basic factory work to advanced, high-tech jobs. Thanks to this seemingly endless supply of workers, China has attracted many businesses from around the world like Apple Inc., Adidas, Samsung, Xiaomi, BYD, and Toyota as prominent examples.
- Superior Infrastructure
China’s competitive economic edge isn’t just about their factories; it’s about the entire network that supports them. The country boasts the world’s largest high-speed rail network, huge ports, and modern industrial zones, supported by the Chinese government. This network enhances supply chain efficiency, ensuring the rapid and cost-effective distribution of finished goods and raw materials, which is a key factor in China’s manufacturing success.
- Centralised Planning for Industrial Dominance
The manufacturing success of China is largely due to a clear, long-term government strategy. The “Reform and Opening” period, initiated in the late 1970s, saw the establishment of Special Economic Zones (SEZs), which is instrumental in attracting foreign direct investment. Its 2001 entry into the World Trade Organisation (WTO) further cemented China as a central hub for countless supply chains.
Currently, China is executing its next move with the “Made in China 2025″ plan, which is a national mission to make not just t-shirts or toys, but to dominate the high-tech industries of the future, from electric vehicles (EVs) to advanced robotics.
China as the global supply chain anchor
Today, China’s manufacturing network has become so vast that most companies find it hard to relocate manufacturing. It is not just about the low cost; it is about the entire ecosystem. China has everything in one place such as suppliers, factories, logistics, and packaging. Their level of efficiency is just hard to find elsewhere.
Some firms are exploring a “China-plus-one” strategy to diversify their suppliers and mitigate risk, but still, China remains the undisputed world’s factory floor.
Looking for a sourcing agent to source from China?
Connected Sourcing helps small and medium sized businesses to scale by finding them great suppliers to partner with. With over 20 years of strategic sourcing experience, we understand our clients and pride ourselves on developing effective solutions to help businesses increase their top-line.
To learn more about sourcing products in China, contact one of our experts at Connected Sourcing today.
Frequently Asked Questions
1. Should I work with a sourcing agent when sourcing fom China?
A key benefit of hiring a product sourcing agent is their vast network of suppliers. Their specialised knowledge and expertise can be highly beneficial in navigating the Chinese manufacturing landscape, especially for startups or those venturing into Chinese manufacturing for the first time.
2. How do I find the best suppliers in China?
Connected Sourcing helps you navigate sourcing complexities by providing a comprehensive supply chain solution, helping you find the best suppliers in China and beyond, fostering reliable partnerships and streamlined operations.
3. How do I ship my finished products from China to my location?
Connected Sourcing provides customised door-to-door global shipping solutions, leveraging trusted logistics partners and expertise in customs and duty regulations, while identifying cost-savings opportunities for your products.
