At parsonsKellogg, we’re often asked by buyers of promotional products whether it makes sense to source products from overseas manufacturers. If a client has unique designs for a product and plans to purchase it in large quantities or in regular shipments, then overseas sourcing can often result it significant cost savings.
However, overseas sourcing of promotional products is not without risk, especially if you use a distributor that isn’t experienced in working with overseas manufacturers. On the other hand, if you use a promotional products distributor who has significant experience, you’ll likely be able to leverage all of the advantages of overseas sourcing without any of the potential headaches.
The overseas market is full of quirks and unique characteristics, and there are a few common challenges of which you should be aware. When searching for a distributor, it may be helpful to ask about these specific issues to gauge the distributor’s experience level:
1) Overseas sourcing of promotional products works best with large quantities or regular orders. Overseas manufacturers make money by producing large quantities of products, and in many cases, charge higher prices for smaller quantities. The exact amount that constitutes a large quantity varies by product. An experienced overseas distributor could advise you on whether your orders are large enough to take advantage of the cost savings.
2) The right manufacturer can save you time. Overseas sourcing always takes time. Depending on the product, delivery could take anywhere from 30 to 120 days from the time an order is placed. However, a distributor who knows the overseas market can help align you with manufacturers who have a track record of timeliness.
3) Some manufacturers are more flexible than others with payment terms. Generally, 50 percent of the order price is paid upfront. The remaining 50 percent is paid when the job is completed. That’s not set in stone, though. A distributor who has a solid working relationship with manufacturers may be able to help you negotiate more flexible terms.
4) Finding a quality manufacturer requires boots on the ground. There is no shortage of manufacturers available for overseas outsourcing. The trick is finding one that is reliable. Many distributors claim to handle overseas outsourcing when, in actuality, they may have little practical experience working with manufacturers. An experienced distributor can rely on their own unique knowledge of the market to pick the manufacturer that’s best for the job.
5) Production time is based off a different calendar. When you source from overseas, you work on the other country’s calendar. That may mean the manufacturer could shut down for a major holiday, like Chinese New Year, regardless of what it does to your timeline. A knowledgeable overseas distributor will advise you on when to get orders in to avoid costly holidays and shutdowns.
6) Local insight can help with price negotiations. Prices for overseas manufacturers aren’t static. In fact, they change constantly based on current demand, competition, and the quality of the product. Effective negotiations require deep insight into the market, which can only be gained by working with a distributor who has its fingers on the pulse of the overseas manufacturing market.
The best method for overseas sourcing of promotional products is to work with a distributor who is experienced and knowledgeable about the market for your product and potential overseas manufacturing partners. The distributor’s knowledge could help you establish a strong relationship with a high-quality manufacturer, which could produce significant cost savings and profits.
