Guide to finding the right clothing manufacturers in China

Learn how to find the right partners in affordable outsourcing destinations. 

Looking to design your own T-shirt or launch a knitwear collection? Outsourcing to China or other low cost countries could be your only option.

In this article, I explain what you need to know when selecting a clothing manufacturer, substance regulations, material quality and managing the product development and production process.

Regardless of whether you are an apparel start-up looking to try out a new product line, or you consider yourself the next Karl Lagerfeld, this article is packed with actionable advice for you. But first, I will explain why buying wholesale clothing from China is rarely an option.

Buying wholesale clothing from China

The Minimum Order Quantity (MOQ) of clothing and textile items is often 300 to 500 pieces per design. That translates into a major investment, assuming that you want to launch an entire collection. Many importers assume that the solution to this is skipping manufacturing to purchase off shelf clothing from wholesalers.

Of course, there are clothing and textile wholesalers in China. In fact, there are tens of thousands of them. However, these wholesalers, trade items manufactured for the Chinese market. Take a look at Taobao.com (China’s Ebay) and see for yourself. You can get a T-shirt for 2 dollars and a pair of jeans for the price of a Big Mac meal. But, China is not a magic land where basic economics don’t apply. In other words, you do get what you pay for.

In fact, you might get a bit more than you really want. At least in terms of regulated substances, such as Formaldehyde and AZO-colors. China’s substance regulations are more lax than those in the west. Thus, buying wholesale clothing from China is rarely (if ever) an option, unless you are willing to risk having your items seized by customs – or face a forced recall.

Important factors when selecting a clothing and textile factory

Not all clothing and textiles manufacturers are equal. Making a random factory selection online, without verifying that the supplier is able to reach your quality requirements, is likely to end up in disaster. Below follows an introduction to the three main factors that really matter, when selecting clothing manufacturers in China.

#1: Substance control and compliance with foreign textile regulations

Clothing textiles are regulated in most countries, including the United States, Europe and Australia. Most applicable safety standards, such as REACH (Europe) and FHSA (United States) regulate substances, such as formaldehyde, AZO-colors and asbestos. Most Chinese manufacturers, especially the smaller ones, are not aware of the substance content in their textiles.

It’s a deeply rooted issue that goes way beyond the manufacturer. All clothing manufacturers purchase fabrics and components from sub-contractors. The number of sub-contractors can range from two or three, to more than one hundred. Ensuring that no non-compliant fabric slips through requires the supplier to test a large number of samples, which most small factories consider too expensive and time consuming.

#2: Textiles labeling requirements

Clothing and textile regulations are not only limited to substances, but also product and packaging labeling. These labeling requirements vary greatly between different countries. However, most countries require labeling to cover Country of Origin (Made in China), textile fiber content and washing instructions.

However, a supplier cannot really be compliant or non-compliant with labeling requirements. In fact, it’s your job to design the textile label, and verify that it’s compliant with applicable regulations in your country. The supplier’s job is to print it. That said, they must be able to provide you with information about the textile fiber content and washing instructions.

#3: Fabric quality

Good suppliers provide high quality fabrics and bad suppliers provide low quality fabrics. But, it’s not that simple. A couple of years ago I learnt that myself, the hard way.

In 2011, we were tasked with managing the product development process of a new polo shirt collection for a European brand. They had already selected a new supplier in the southern Fujian province to manufacture their new designs. It was a good supplier. Clean facility, long history, plenty of capital, modern machinery and a strict quality management system.

The client received the samples and testing began. A few weeks of usage and washing later, it was clear that the material quality was far below the clients' expectations. While they wanted to match brands like GANT and Ralph Lauren in terms of quality, this sample would go straight to an outlet.

Obviously, the client was upset about this, and we submitted a complaint to the supplier. They made another batch of samples. But the result was the same. This was when we realized that this may be a reliable supplier, yet unable to match our buyers quality requirements. It turned out that they were indeed specialized in making low end apparel, and pretty good at it too!

Before you get started, you need to get your fabric specifications in order. Never assume that a Chinese clothing and textiles manufacturer is specialized in making items matching your quality requirements, regardless of their technical qualifications.

Product development process

When you have selected a few suppliers (not only one, as explained further down in this article) it’s time to put them to the test. Keep reading, and find out how to manage the clothing product development and production process:

Step #1: Design drafting, material selection and product specifications

Chinese manufacturers are entirely accustomed to producing items according to buyer specifications. While some suppliers offer design services, they will certainly not help someone to design a new collection based on a random inquiry on an e-commerce platforms like Alibaba.

Before you even bother to contact manufacturers, you need to get your specifications in order. These include, but are not limited to, the following:

• Design drafts
• Design elements (e.g. collar)
• Dimensions
• Fabric type (e.g. 96% cotton and 4% spandex)
• Fabric weight (e.g. 120 gsm)
• Printing or embroidery (e.g. screenprint)
• Pantone colors
• Buttons (design, material)
• Seams
• Textile label (design files and dimensions)
• Compliance requirements (e.g. AZO-free colors)

You may also complement a product specification with physical product samples, in case you intend to replicate a certain color, material or design elements of an existing product. However, certain components, such as buttons, are better left open until you know what the supplier has to offer.

In case you fail to provide sufficient product specifications, you are likely to receive items of very poor quality. Misunderstandings occur easier than you could possibly imagine, and there is no universal definition of what “good quality” is. Nothing should be left out of your product specification.

Step #2: Sample development

This is when it gets interesting, but act with caution. First of all, it’s way too early to make a final supplier selection at this stage. Instead, you shall select at least three or four suppliers that produce clothing samples simultaneously.

In my experience, roughly 50% of the suppliers fail to manufacture satisfying samples. They might lack the precision to get the seams straight, provide low quality material or prove that they don’t really care that much about following your design requirements.

Samples take time to develop, and often require a few revisions. All of a sudden three months have passed. If you have made a final supplier selection too early, you might need to start all over again. That’s why it’s critical to keep several supplier options at hand at this stage. Thereby, you can simply ditch the supplier failing to produce satisfying samples, and move on with those that succeed. Yes, it costs a bit extra to buy samples from four suppliers, rather than only one. But, considering the time and money you will save, it’s well worth it.

Step #3: Compliance testing

Previous compliance means that a supplier can prove that they are able to ensure compliance. While that is a key qualification requirement, it’s not a guarantee for future compliance. Thus, you shall submit material samples for compliance testing, before mass production begins.

But, this is also when it gets really complicated. Fabrics are purchased from sub-contractors, and suppliers rarely keep them in stock. The fabric samples that are available during sample production may not be available by the time you place your order. Even if the fabric used for mass production is visually identical, it may come in another batch (thus it may contain other chemicals) or be from a completely different sub-contractor.

In a worst case scenario, this means that you could end up with clothing made of non-compliant fabrics, even though the pre-production fabrics passed compliance testing. However, despite this risk pre-production fabric testing is critical. One way to minimize the risk further is to have fabric samples compliance tested as soon as the batch used for your items arrives in the supplier warehouse, but before mass production begins. That way you can at least avoid a situation where you are left with an entire batch of non-compliant apparel. Sounds complicated? Not so much, if you follow the process below:

1. Select fabrics and confirm applicable substance regulations
2. Ask your supplier if the fabric used for mass production originates from the same batch and/or from the same sub-contractor
3. Collect and submit pre-production reference fabric samples to the test laboratory
4. Supplier begins mass production and order fabrics from one or more subcontractors
5. Collect and submit batch sample reference fabrics to the test laboratory
6. If compliant: approve production

As one material, and sometimes color, requires a separate compliance test, costs increase if you use many different fabrics and colors. If you are on a small budget, try to limit the number of different fabrics used in your apparel.

Step #4: Sales contract

Before you pay the deposit and production begins, a Sales Agreement shall be signed by the clothing manufacturer. The main purpose of the sales contract is not to get prepared for future disputes, but to prevent them.

First of all, it shall prevent misunderstandings. Thus, it shall include product specifications, design drafts, material specifications and color samples. You may also attach physical samples, for the supplier to sign and stamp.

However, these specifications may be useless unless you put pressure on the supplier to actually comply. This can only be achieved if you make the supplier understand that you will verify compliance, and that you have a bargaining chip at hand, in case they wouldn’t.

In order to verify compliance, you need to follow up with Quality Inspection. I’ll get back to that in a bit. The payment is also critical. If you pay a supplier 100% in advance, they no longer have an incentive to remake or repair defective items, in case the quality inspection fails. This is why the final balance payment shall be withheld until the quality is verified.

Step #5: Quality control

Manufacturing is not a science. Quality issues are certain to occur, to a varying degree. They can’t be completely eliminated, but they can be managed and reduced to a degree that they don’t affect the viability of your business.

Forget about returning defective items to China. Low cost manufacturing is cheap for a reason. Instead, you must verify that your clothing reaches your quality requirements before it’s packed and shipped. Thus, a Quality Inspection shall be executed in the manufacturer’s facility, after production – but before shipment.

There are a number of defects that may occur when manufacturing clothing. Below follows a list of defects I have stumbled upon:

• Poor seams (e.g. not straight, loose threads)
• Discoloration
• Skewed embroidery
• Incorrect dimensions
• Loose buttons and zippers
• Dust and dirt

However, certain quality issues cannot be detected during a single factory inspection. For example, poor quality fabrics may lose fitting, only after a few washes. This is why extensive sample testing, and actual usage, is critical, before production begins. 

This article is re-published with permission from Frontier's content partner, ChinaImportal, an e-commerce platform that assists businesses looking to import products from China.

See the original article here.

Meet the Nigerian fashion designer building Africa's Hermès

By Mfonobong Nsehe

From Goldman Sachs to launching her own fast-growing high-end fashion start-up, Nigerian entrepreneur is looking to tap into Africa's growing luxury goods market.

Kunmi Otitoju, a 30-year-old Nigerian fashion designer and entrepreneur, holds two Computer Science degrees – a Bachelor of Science degree with first-class honors from Howard University and a Master of Science degree from Virginia Tech.

But her first love was Fine Art. As a high school student in Lagos, she won the Fine Arts prize at school every year for 3 years. Having moved to the U.S. when she was 17, and then to Europe at the age of 25, Otitoju found herself deeply enmeshed in western culture. Keen on preserving her Nigerian identity and eager to propagate facets of Nigerian culture, she conceived the idea of lining high-quality leather bags with Aso-oke fabric, a hand-loomed cloth woven by Nigeria’s Yoruba people.

In 2011, after stints at Goldman Sachs and a few other international corporations, Otitoju established Minku, a fast-growing high-end Afro-centric brand that produces luxury bags, wallets and other fashion accessories for men and women by subtly blending Aso-oke into contemporary Spanish leathers to present a transcontinental finish.

All Minku’s products are hand-made at a workshop in Barcelona, Spain, but they are sold at high-end stores in Nigeria and on the company’s website.

Otitoju recently spoke to me about her journey, her future plans, and the state of luxury goods in Africa.

Why Aso-Oke?

For me, Aso-Oke is luxury. It is hand-woven, the weaving is dense, in the imperfection of the weaving lies evidence of the human touch, and it comes in sophisticated colours and patterns. What is luxury afterall? For me, it is the finest aspects of one’s culture, distilled, packaged, presented to, and accepted by the rest of the world. For example, Italy has leather and coffee as some of the finest aspects of its culture, and that is evident with the luxury companies out of Italy. Same with Switzerland and watches. Africa was a bit late to the branded luxury game, but we are catching up. Aso-oke lets me contribute to this in a small way.

Are you expanding into other goods and services?

Yes. We now offer a personalization service that lets our clients customize a purchase with their name/initials/message embossed onto the leather. It is a nice way to personalize one’s Minku bag, or just to include a message that is a reminder of love or a feeder of good vibes.

In our latest collection, I introduce bracelets for men. Men’s bracelets have gained wide acceptance among males, from surfers in Cape Town to investment bankers in New Jersey. I personally buy into the idea of a man wearing a beaded bracelet — it tells a story of travel and daring, and it alludes to an open mind. So combining precious metals — 18kt gold, sterling silver — with powder glass beads hand-made by the Nupe people of Nigeria, I created a collection of men’s bracelets. Each bracelet comes in an Aso-Oke lined watersnake leather drawstring pouch of varying designs. The pouches double as key-chains.

You have been running Minku for three years now. How is it received?

Minku has been well received. Like any other entrepreneur, I have had some discouraging moments. But many good opportunities have also arisen, sometimes unexpectedly, and it is those that have helped Minku to grow. So I work hard on product and marketing, but I have also learned that serendipity is part of entrepreneurship.

Are there any specific experiences that shaped your resolve to be an entrepreneur?

My parents have been entrepreneurs for most of my life, so I had exposure to the idea of becoming one, quite early on. In 2010, I was accepted to Stanford University to study product design under the Stanford Mechanical Engineering Masters program. This was a dream come true for me because I love Formula 1 and I wanted to study how to design faster cars (I still do; I love working with constraints, and Formula 1 car design provides constraint sets that fascinate me). However, I had just moved to Barcelona less than a year earlier, and did not yet want to leave.

So, I had a hard question to answer: if I didn’t go to Stanford, could I still do good design, at a level similar to if I was a Stanford Product Design grad? I was not sure, but I decided to try. I think a lot of the courage to set out and start Minku came from desperately wanting the answer to that question to be a ‘yes’.

What do you think about the luxury market in Africa?

I think there is a fast-growing market for African-made luxury goods in Africa. Building this market to last will take a paradigm shift as to why it’s as cool to own a leather bag designed by a Nigerian or Kenyan luxury house as it is to own one from an Italian powerhouse. But it also takes much product/service refinement on the part of African designers and manufacturers. Recently, African designers have been hitting the mark on product refinement, even with local production. This has been producing results, and needs to continue. International gatherings like the 2012 IHT Luxury Conference also help to focus on Africa’s capacity for luxury creation and consumption. I like the idea of Africa as a destination for handmade luxury.

As a person running a business, what are some skills or attributes that you have found to be indispensable?

As a person running a business, I have found that optimism has helped me get far. If you combine an optimistic disposition with research and hard work, you can do great things.

As a creator of quality leather goods, what are some skills or attributes that you have found to be indispensable?

The main skill for me is creativity. I will go meta and say that an indispensable skill has been knowing how to get myself into my best creative mode.

Where do you see Minku in 5 years?

I try not to plan ahead much, because there are too many factors beyond my control. At the moment, growth for Minku is centered on making the most desirable products I can conceive. I am working with unusual materials: Aso-oke from Nigeria, and leather. So there is already some novelty there, but I am interested in seeing just how much excitement I can wring out of people, both men and women, on the mundane topic of bags. So much of my current focus is on that.

I belong to the generation where the most successful social network was started out of a dorm room, so for me, having a small atelier for working and an online storefront has not been unusual, and I am lucky that this model has been well-received. In five years, I would love to have a flagship store for Minku, perhaps in Lagos or New York City.

This article was first published by Forbes here

Mfonobong Nsehe travels across Africa, helping Forbes to chronicle the stories of successful African enterprises and entrepreneurs.

Top 6 private equity deals in Africa

Consumer-facing sectors are proving to be the most compelling for private equity in Africa, as demonstrated by the type of deals in July.

The Abraaj Group invests in Tunisian private hospital

The Abraaj Group announced its funds had acquired a majority stake in Polyclinique Taoufik S.A., the second-largest private hospital in Tunisia with 164 beds.

The investment will help the hospital to consolidate it’s strong position in the market by further increasing patient capacity and adding new services, upgrading and renovating the hospital, and investing in human resources and training.

To implement its growth strategy for Clinique Taoufik, Abraaj will draw on its extensive experience in the healthcare sector, gained from investing in businesses across the Middle East, North Africa and Turkey.

Population growth in North Africa is expected to reach 190 million by 2020, and with life expectancy also on the rise there is potential for further demand for quality healthcare services.

Tunisian healthcare sector made up almost 7% of GDP in 2013.

The investment is the sixth by Abraaj in Tunisia. It’s portfolio includes baked goods company Moulin d’Or; Unimed, a leading player in sterile form pharmaceutical products; and Plastic Electromechanic Company (PEC), which specializes in plastic injection, the assembly of electrical equipment and harnesses, and medical products.

AfricInvest Group and FMO form SFC Finance

AfricInvest Group and FMO (The Netherlands Development Finance Company) are part of a consortium which created SFC Finance, a senior secured lender providing funding for growth or expansion to small and medium enterprises (SMEs) in Africa.
SFC Finance will structure its loans with tenors adapted to the cash generation capabilities of its customers. Shareholders committed equity of US$20-million, alongside an initial US$50-million debt facility extended by the Overseas Private Investment Corporation. 

Debt financing for SMEs in Africa is poor, particularly the lack of credit facilities with repayment schedules that reflect company cash flows, a factor which has inhibited their growth. SFC Finance will address these needs, and also SME governance and environmental and social responsibility.

Amethis Finance announces final closing at US$530m

Private investment fund, Amethis Finance, saw final close of their first fund at US$530-million, which included institutional investors from Europe, US and Africa, together with close to 40 European and US entrepreneurs and family offices. 

Amethis has already made five investments since announcing their first close 18 months ago, in fast -performing companies in Kenya, Ghana, Cote d’Ivoire and Mauritius - in the banking, oil and gas, retail distribution, and logistics sectors. 

The Fund's shareholding structure mixes classical institutional investors (banks, insurance companies, fund of funds) with successful private entrepreneurs from the manufacturing and services sectors who are investing often for the first time in Africa and are looking to know better the continent. It assists its investors in their expansion, notably through co-investments.

Economic models are rapidly changing in Africa, with consumer and retail oriented companies taking advantage of those evolutions. This rapid growth is creating significant capital needs for local companies, and Amethis’ strategy is to foster long-term ties with well-established, high-growth African businesses that need long-term capital. 

Private European and US entrepreneurs and family offices are increasingly investing in Africa, and see the continent as the next world frontier for growth.

DPI and PIC in consortium acquisition of RTT

Development Partners International (DPI), through African Development Partners II, and the Government Employees Pension Fund (GEPF), represented by the Public Investment Corporation (PIC), acquired 80% of the RTT Group, Africa’s largest privately owned parcel distribution company, for an undisclosed sum. Ethos Private Equity leads this consortium.

The investment will expand RTT's offerings, and help to tailor services to specific customer needs.

RTT is a market leader in third-party logistics and distribution, and a forerunner in break bulk and express distribution. The company operates across sub-Saharan Africa, comprising over 120,000m2 of warehousing and cross docking facilities. RTT has a combined fleet in excess of 1,200 vehicles and employs close to 5,000 people. Revenues exceed R2.5-million per annum.

Fusion Capital buys equity stake in Kenya’s first free newspaper

Fusion Capital acquired a 40% equity stake in Xtra Publishing Limited, a free newspaper and digital content company in Kenya. 

Xtra will leverage free print and digital services in an attractive new media hybrid model. The company launched the region’s first free newspaper in March and is already the third-largest newspaper in Kenya. The newspaper will be supported by online and mobile services targeted at the young professional demographic. IPSOS/Synovate readership surveys confirm that the newspaper has secured the young, urban professional readership, providing near zero wastage for advertisers.

The investment by Fusion will be utilized in advancing IT and editorial systems, and for working capital requirements.

Kenya and East Africa is showing encouraging trends in digital news and entertainment dissemination. The statistics show impressive growth with Internet usage having doubled between January 2010 and 2011, from 3 million to 7.5 million users. Usage further increased by another 65% between October 2010 and October 2011, rising to 14.3 million users.

That figure corresponds to over 36%of the population having access to the Internet (WAN-IFRA 2012).

Helios Investment Partners and IFC in US$630-million equity fundraising round for Helios Towers Africa

Telecommunications towers company, Helios Investment Partners, and the International Finance Corporation (IFC) participated in Helios Towers Africa’s latest equity fundraising round, which raised US$630-million in new equity resources from existing and new shareholders.

Existing shareholders including Quantum Strategic Partners, Helios Investment Partners, Albright Capital Management, RIT Capital Partners and IFC, added to their current stakes and are now joined by new shareholders, Providence Equity Partners and IFC African, Latin American, and Caribbean Fund.

Helios also expects to complete negotiations shortly on new and extended debt facilities of over $350-million with a strong syndicate of international and local lending institutions.

Following this latest injection of capital, Helios will have raised over $1.8-billion in external financing since inception in late 2009 to fund acquisitions and organic growth.

The telecommunications towers industry in Africa has huge potential. There is need for 100,000 Points of Service (PoS) to merely satisfy demand for 2G coverage and associated capacity demand over the next five years. This PoS requirement is underpinned further by the growing demand for 3G and 4G data, which is driving the need for significant additional infrastructure capacity and in-fill across the continent.

Helios owns over 7,800 towers in Africa.

5 steps to planning a business trip to China

By Fredrik Grönkvist

So, you’ve found a couple of suppliers online and want to find out if they are everything they claim to be. That’s a good first step.

But, boarding the next flight to China, with a list of three random suppliers you found online, is most often a complete waste of both time and money.

In this article, I explain how you need to prepare yourself before your business trip to China, and what to should look for while you’re there.

#1: Is the supplier able to show compliance with product regulations in your country?

In most industries, less than 5% of the suppliers are able to show previous compliance with American, European and Australian product regulations and standards. Assuming you don’t verify their compliance prior to your visit, you’ll waste a lot of time visiting suppliers that are neither willing nor technically capable of complying with the relevant standards.

Besides, compliant suppliers tend to be above average in other aspects. Apart from the obvious legal requirements, I also consider compliance a strong indication of the supplier’s technical expertise.

#2: Schedule meetings with as many suppliers as possible

All manufacturers are not equal. Expect at least 50% of them to not be what you expect. It’s bad out there. I’ve been taken to factories that have not been operational for months. Factories that would barely pass for junkyards.

I can even recall one really weird situation a couple of years ago, in Xuzhou, when I was taken to the same factory twice in the same day. First in the morning, when a representative of a Trading Company took me there. The second time in the afternoon, when the actual owner of the factory picked me up.

It felt quite awkward to tell the boss that I had already visited their factory earlier that day. Not to mention that I wasted my entire afternoon. Not that there’s much else to do in Xuzhou…

The lesson here is that you’ll return home empty handed if you visit one or two random suppliers. It’s not enough. Schedule visits with at least five or six suppliers, and list a handful of backup suppliers – in case the first round fails to live up to expectations.

#3: Make yourself familiar with the geography

China is a big country, with hundreds of industrial clusters on the east coast. If you’re lucky, you can limit your visit to a single city. Certain industries are in fact concentrated to single cities, such as Shenzhen. However, in other industries, suppliers are scattered all over a province – or even the entire east coast.

First of all, you need to make a traveling plan. Getting to China is easy, and there are direct flights to major cities such as Shanghai, Hong Kong, Shenzhen, Guangzhou and Beijing. But most suppliers are not located in these cities (with the exception of Shenzhen). Instead, you are likely to find yourself spending time provisional cities like Taizhou, Foshan, Dongguan and Changzhou.

Getting there is not that much of a hassle though, thanks to China’s high speed train network. You can get to basically any city on the east coast by train. And that’s about as far as you need to get on your own. Any supplier worthwhile visiting will take you from there to their factory by car.

#4: Confirm the suppliers factory address

It’s common that suppliers, even those who are manufacturers, trade products supplied by subcontractors. It’s not always a bad thing though, but I prefer to be aware of such arrangements before I make my way to whatever village the supplier is located in.

All Chinese companies have a registered address. If the supplier is actually manufacturing the products, the factory should be located at the same address as specified on their Business License. There are exceptions, but this is the general rule.

If the supplier brings you to another address, they are probably taking you to a factory that’s not theirs. But then again, sub-contracting is not always a bad thing. What’s important is that you make your supplier understand that they are going to be held liable for defective products. This is a relatively small issue when dealing with qualified and organized manufacturers, that are in turn outsourcing certain products to sub-contractors. They have assets, and it’s not so easy for them to “disappear” in case things turn out bad.

But that doesn’t apply to smaller trading companies, that consist of little more than an a small office and a few employees. Apart from old laptops and dusty product samples, these companies have no assets. They can’t afford to compensate you if they would run into quality issues. It may also be in their interest to align with the manufacturer, rather than you, in case of a dispute. Stay away from these companies.

That being said, there are also reputable Trading Companies that act as exporting platforms for tens, sometimes hundreds, of manufacturers.

#5: Prepare product related questions

When communicating with a supplier on the internet, you rarely get further up their organization than the sales agents. However, you can expect a lot more attention when you show up in person at the suppliers factory. This means that you’ll get access to their managers and engineers - the people who are actually qualified to talk about their products and manufacturing capabilities.

Whenever I go out to visit suppliers and sit down with their engineers, I get to hear things the sales agents never told me. Probably because they are more concerned with making the sale, rather than telling me the truth. But also because sales agents are not engineers, they spend their days drinking tea and gossiping with their friends on WeChat -  apart from a few occasional conversations with potential customers. The engineers, on the other hand, are qualified to tell you what they can do, and what they can’t. I can recall plenty of times when the sales agents had promised things the supplier was simply not able to deliver on.

While you got the manager’s attention, it’s also a golden opportunity to make them understand that you’re not a gullible idiot. Make them aware of planned quality inspections and lab tests. It’s always good to put pressure on a supplier to comply with your quality requirements and product specifications.

Chinese companies are top heavy, and the only way to make things run smoothly on the production line is by applying pressure on the people in charge.

Inspecting the factory

The production line tells a lot more about a supplier than their brand of instant coffee or what car the owner is driving. Perhaps his new Audit was (involuntarily) financed by the last customer who didn’t bother to hire a quality inspector. The first thing to look at is how well they monitor product quality during the different stages of production. This is what you need to take a closer look at:

#1: Incoming materials

Manufacturers are not “Santa Claus workshops” that make every single material and component in house. They purchase components and materials from tens, sometimes hundreds, of domestic and foreign subcontractors. When quality issues occur, these subcontractors are often to blame (and many suppliers try to use that card).

What really matters to you is that the supplier checks the quality of the incoming materials and components. They shall also separate components and materials that are compliant with certain standards (such as REACH), from those that are non compliant. A supplier that’s not able to manage such separation is a major liability.

#2: Production lines

Manufacturing is not a science, there are always quality issues. What differentiates a good supplier from a bad supplier, is that the former monitors quality during the production process – and minimizes the number of defect units that slips through unnoticed.

A supplier that cares about maintaining a high quality standard has several checkpoints throughout the assembly line. They shall also be able to show how they define and manage defective units. A supplier claiming to have a zero defect rate during production is simply not monitoring their production well enough – if at all.

#3: Assembled products

Products coming off the assembly line shall also go through a final check. While a supplier is not necessarily testing every single unit, a final quality check shall include 2-5% of the batch. Finally, the supplier shall also maintain quality control records. If they claim to be ISO certified, they are even required to maintain records.

Is the supplier’s production lines busy?

It speaks for itself. A supplier with empty warehouses and dozing workers is obviously not doing that well. There’s a lot of overcapacity in China. Plenty of suppliers barely get enough orders to make ends meet. Doing business with such manufacturers is a liability. Even if they have the best intentions, suppliers operating on the edge of bankruptcy are not liquid enough to compensate buyers in case serious quality issues occur.

Before you leave, check out the factory warehouse

Not all manufacturers in China are geared towards Western markets. Many, of not most, are primarily made products for the domestic Chinese market, and developing markets in Asia, Africa and Latin America. That’s not saying that these suppliers are “bad”, but it may indicate that the supplier is not that knowledgeable about Western quality requirements and product certification requirements.

That’s why spending some time in the factory warehouse is a wise decision. This is where the suppliers stack hundreds of cartons, before being loaded into containers and shipped to buyers around the world. There’s only one thing that’s better than a warehouse full of goods about to be delivered, and that’s a warehouse full of goods addressed to buyers in your country.

These are strong indications that the supplier is not only kept busy with regular reorders, but also that they are well aware of product regulations and quality expectations in your market. And that is something you shall never take for granted when doing business in China.

This article was first published here

Fredrik works at ChinaImportal, an e-commerce platform that assists businesses looking to import products from China.

Growing a footwear brand in Africa

Nigerian footwear company, Maducho Luchi, saw a lucrative opportunity to supply luxury fashion products to the country's increasingly affluent middle class.

Africa's growth story is encouraging more people to start their own businesses, with the aim of taking advantage of the huge opportunities especially in consumer-facing sectors.

In Nigeria, footwear manufacturer Maducho Luchi successfully tapped the country's vibrant fashion industry to produce footwear for local and international markets. 

In this interview, Graham Chike, sales and business development director at Maducho Luchi, narrates the company's challenging but rewarding journey of starting a contemporary African shoe line.

Tell us about Maducho Luchi

Maducho Luchi is a brand that is focused on designing and creating fashion products that are fused with a touch of African culture and a modern appeal. We kicked off the brand with men shoes and have plans to diversify in to other products in the near future. Our target is to create a system whereby fashion products from sub-Saharan African are appreciated overseas, thereby creating growth in several sectors of the economy on the continent. 

It all started in September 2012, when I met with my first creative director. Then there was no name to the brand. We just wanted people in the United Kingdom to experience shoes designed and made in Nigeria. They loved them, and in February 2013 when I returned home after completing my MSc degree, we started Maducho Luchi. The name Maducho Luchi came from a fusion of some African names. We had to think of something easy to pronounce, yet outstanding. Marketing brands today is different from what it was in the past. So one has to think of how a brand name can sell now and also in the future. It has been many ups and downs since then. We are over a year old now and I can say that we now have some good level of acknowledgement by users and celebrities. We have also managed to ship luxury shoes to many parts of the world and generated revenue that has kept the brand running smoothly. 

Why are most of your marketing campaigns focused on Europe and the Middle East? 

A lot of companies and brand facilitators really appreciate talent in these markets, so yes, we are deliberately focusing there. The fashion industries in Europe and Middle East are very keen to see new products. Smart designers take advantage and use that as a good path to success overseas which triggers success back home. 

How has the brand being received locally?

Brand appreciation in Nigeria has been wonderful. Some people love good craftsmanship here. And with little or no marketing, we have been able to grab a fair market share.

What strategies have you used to brand and market within Africa?

We have a big model waiting for good investors to buy in. We won’t let the cat out of the bag now. But once the investors come on board. It would spread like wildfire. A strong campaign that anyone who wants to copy would key into. But for now we only take on social media campaigns which is a growing trend in Africa. It has also done us well.

What challenges have you faced locally since starting Maducho Luchi?

Starting a brand in Nigeria is hard. We need more support but get less. The system doesn’t encourage good export trends. We don’t have a good market structure to engineer products so as to generate more jobs locally. You don’t get investors at the right time. And many others challenges.

How has Maducho Luchi managed to maneuver such challenges so far?

We have always set a goal and a target. The team has many technocrats, and most of us have schooled and worked in Nigeria and overseas - this has worked to our advantage. We leverage on this combined experience and education to overcome the challenges. We have firm goals - to produce and deliver an excellent product that will make our local and international customers happy. 

Is the market for luxury shoes sustainable in Africa? 

There is supporting data on the increasing demand for luxury products in Africa, and many international brands have already moved in to exploit the opportunities in countries like South Africa, Kenya, Angola, Ghana and Nigeria. So, there is definitely a big market for the shoes - we have done so well with very little marketing push. This is a profitable venture, and we really encourage investors to come on board. 

What advice would you offer potential startups in Africa?

A lot of fashion brands have come up in Africa and are now successful. In this line of business, it is possible to create a sustainable brand and profits. But one must have a firm plan, great passion and drive, and be ready to build a strong team because, as we say here, two brains are better than one. Find reliable and talented people who believe in your dream and you can make a fortune together. 

This article is re-published with permission from Frontier's content partner, Ventures Africa.