4 Reasons Why Trading Companies Are Better than Manufacturers

Most people who want to import certain products from china will always say “I want to find the factory” because they think factories offer the lowest price. This is not always true. Sometimes, a trading company offers cheaper prices than factories. Buying from factories also has various other troubles such as quality issues and late delivery.

In China, trading companies are sometimes more popular than factories, that’s why the number of trading companies is times more than that of factories. IKEA, Walmart, and other large customers are also supplied by various trading companies. Li & Fund Ltd, a well-known Hong Kong Company is one of the most successful trading companies and serves countless international groups in different industries.

Trading companies offer professional and better service, and I’m going to introduce its advantages in following 4 reasons.

1. Trading Companies Are Easier to Communicate with

Sales from trading companies tend to have higher and better English understanding and communication level as compared to those of factories. Thus, they won’t get problems in communicating with customers. They also reply to customer’s emails in time. If there is any problem in production, shipping, or inspection, the trading company’s sales always notify their clients at the first time.

Many middle or small-scale factories tend to put more emphasis on production, and cooperation with local trading companies. Those factories may also have foreign trade sales, but they are not good at communicating in English and are usually slow to reply to customer’s emails (Chinese mostly use Wechat and phones for daily contacts and rarely use email). In addition, most qualified sales prefer working at trading companies because that’s where they get more working experience.

For instance, our factory supplier for kid toy helmets is the best among the suppliers of this product in China. Although they also have foreign trade sales, they spend over 90% of their time dealing with trading companies. Thus replies to inquiries at Alibaba may take two to three days, and others don’t even get replied.

2.Trading Companies Have More Product Choices

Every single product supplied by a trading company usually gets many factory suppliers, thus there are more designs and types. Even for just one item, the trading companies may offer products of different qualities according to customers’ requests.

Factories usually specialize in one product, which leads to great limitation, they cannot offer you many choices.

For instance, if you do cup business and you choose a trading company, you will get the choices of materials such as stainless steel, plastic, and glass, or cups suit for kids, sport, teens, etc. If you choose a factory, you will have to contact 5 to 10 of them because you will be getting only one choice from each.

3.Trading Companies Have Smaller MOQ

MOQ refers to the minimum order quantity. The MOQ of trading companies is usually small, but they are also able to serve well both small and large businesses. Even for small orders, quality is strictly controlled.

The MOQ of factories is much higher, so they prefer customers who can place large orders such as one container for just one single item. For small orders, they prefer taking them from trading companies，so that can save the time of complicated communication with foreign customers. They can just deliver goods to trading companies, which usually place orders to them.

4.Trading Companies Are Safer to Cooperate with

Trading companies choose their suppliers carefully. They tend to choose stable factories that produce good quality goods so that they can enter into long-term cooperation.

If a customer has an issue with the quality of the product, the trading company will be readily available and willing to help, and if necessary they will ensure that you get a part refund from factories. Because it is the trading company that brings business to the factory, so factory has to satisfy the request of the former.

If you don’t usually buy large quantities from factories, when quality issues arise they will not readily help the way a trading company does.

5. The following tips may be helpful for those who prefer buying from factories

You specialize in just one product type and you just need that from one supplier.
You are familiar with factories based in the local or some other cities and you can easily find them. Because finding factories is sometimes challenging even for native Chinese. You better focus on the selection of the various products that trading companies offer instead of spending too much precious time finding factories.