What to establish before the first purchase order: the legal entity, where the goods are made, whether that site can make yours, and the records you keep.
Establish the company before the conversation goes further
A mainland Chinese company has a business licence carrying an 18-character unified social credit code, tied to a registered name, a legal representative, registered capital and an approved business scope. Check that the scope covers what you are buying, that the entity you would pay is the entity on the contract, and that the trading name used in email corresponds to a real registration. This costs very little and removes the failure mode that no amount of later diligence recovers from: paying the wrong company.
- Unified social credit code, registered name and legal representative
- Approved business scope covering your category
- Payee, contracting party and negotiating party all the same entity
Separate the seller from the maker
A valid licence tells you a company exists, not that it manufactures. Trading offices and factories look identical on paper, and both are legitimate — but the difference changes what a price means, who can answer a technical question, and how long a problem takes to reach the person who can fix it. Ask directly, then verify: registered address against production address, equipment and capacity against your volume, and evidence of having made your product category rather than a general assurance. A live video walk-through arranged at short notice is harder to stage than one scheduled a week in advance.
- Ask whether they manufacture or resell, then verify the answer
- Registered address checked against the production address
- Evidence of your specific category, not a general capability claim
Judge capability against your actual order
Capability is relative to what you are buying. A factory comfortable with 50,000 units may handle your 2,000-unit order badly, and one used to domestic wholesale may never have applied the labelling your market requires. Put your real specification in front of them early — materials, tolerances, packaging, market-specific labelling — and pay attention to whether they ask questions. A supplier who accepts a specification without querying a single tolerance has usually not read it.
- Match capacity and typical run size to your order, not to their largest
- Confirm experience with your market's labelling requirements
- Treat an absence of questions as a warning, not as agreement
Decide what evidence you will keep, before you need it
Retail buyers are usually asked to justify a supplier decision twice: once internally, and once when a product is questioned. Decide at the outset which records you will hold — the entity record, the specification and approved sample, inspection reports with photographs, and the test reports your market requires — and where they will live. Product safety obligations fall on the retailer or importer in most markets, and the practical form they take is a file you can produce. What we can supply is the sourcing side of that file; the compliance conclusion for your market is yours to reach, with your own advisers.
- Agree the record set at onboarding, not at the point of a complaint
- Supplier file, specification, samples and inspection evidence held by you
- Compliance conclusions for your market come from your own advisers
What a factory visit can and cannot establish
A visit confirms that a site exists, what is on the floor, whether the process for your product type is running, and how the place is kept. Our people can observe and photograph working conditions and site conditions and report what was seen. We do not issue reports under the name of any social-compliance or certification scheme, and an observation is not an audit finding under such a scheme. If your customer or your own policy requires a named scheme, that assessment is commissioned separately from an accredited body.
- Observation and photographs of what was on site on the day
- No reports issued under any named certification or audit scheme
- Scheme audits are commissioned separately, from an accredited body
Authoritative references
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