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A shipment arriving late…no one wants to hear that. This situation can cause the loss of a large customer, a loss in profit, and cost some serious dollars. Many managers responsible for goods manufactured in China are “caught by surprise” when a shipment is late. Tsunamis, dock strikes, and pandemics, which no one can control aside, there are ways to maintain a consistent supply shipment.
Know the National Holidays
The major source of China supply interruption stems from Holidays and National Observances. China has quite a few national observances throughout the year. In fact, some of them are major public holidays where factories shut down for several days. These holidays can cause disruption during what the USA customer would consider normal working weeks. What American business people sometimes do not do is verify the length of time the factory manufacturing their particular item(s) will close. The actual holiday dates are not as important as the days the factory will actually be closed. Truly, some factories shut down days before the holiday starts and won’t reopen several days after the holiday officially ends. However, this depends on the industry, the product, and, in some cases, the location of the Chinese factory.
New Year’s Day, the Chinese New Year, Qingming, May Day, and Memorial Day cause major production and shipping interruptions. Likewise, China’s National Day and the major Holidays we celebrate in the States at year-end also causes delays. China’s New Year, much like our holidays from Thanksgiving through the New Year, is one of the most important festivals on the global calendar.
Understand Your China Manufacturer’s Holiday Schedules
A company doing business in China MUST understand the China holidays. Not only understand the relevance of the holiday itself but the actual, official dates of the holidays. It also helps that you know the traditional “time off” days that factories will take for each one. And, as we discussed earlier, American companies could do themselves good by verifying these timeframes each year. You’ll want to know ahead of time what days the factory will be doing business around the holiday times. In fact, when US companies work with a China manufacturing liaison, that liaison should keep their company clients aware of all upcoming holidays. Lastly, they should also let US companies know about the impact of production from their China factories around the holidays.
ITI Manufacturing helps companies in the States understand holiday production schedules and order supplies far enough in advance to mitigate the delays that will come without fail. When your company knows when the manufacturer will be closing – and for how long – it’s much easier to navigate through the ordering process. Many factories are located near the coastal provinces near warehouses and major shipping ports. However, many of China’s factory workers live more inland and raise their families several miles away. Therefore, when major manufacturers shut down for the Holidays the downtime is greater on the front side and the end of the holiday. This time allows workers to travel home to spend time with family and then return back to production.
ITI helps our customers navigate through these schedules. We ensure our customer’s orders are placed in a timeframe that coincides with the holidays. As a result, our customers’ shipments do not “miss the boat” – literally – and can continue tending to other important business matters.
Other Outsourcing Tips from ITI Manufacturing
Below are a few additional suggestions…
ORDER EARLY
This should be a no-brainer. Your company will always want to place orders early enough so that you can receive them before you need them. Meaning, the factory can either ship early and beat the holidays, or be ready to ship immediately after they end.
HAVE PAYMENT READY
Depending upon your financial agreement be sure to verify your payment schedule especially near Chinese New Year. Some shippers and factories raise prices during holiday times and for “rush” orders. Be sure to confirm these details so you are not caught by surprise.
CONFIRM SMALL ORDERS
Never assume that your small orders will be easy for factories to manufacture quickly when it’s close to holiday time. Unfortunately, many companies assume this idea and make the same mistake. You should always ask or consult with your manufacturing liaison to confirm if factories are even taking small orders close to holiday time. Many customers of the factory you are using may want their large quantity orders rushed so they can ship before whatever holiday. In other words, confirm early.
KNOW LOADING DEADLINES
Knowing when a factory will close is only part of the equation. Container loading deadlines may be different the closer it gets to a holiday. There’s a difference between when products ship to the port and when they actually sail from the port. Most companies do not always know how to avoid the dilemmas associated with container loading overbooking. It’s possible for your product to “ship” to the port on time but then not make the deadline for ship loading.
EXPECT “LIMITED” TO “NO” COMMUNICATION
If you are doing business directly with a Chinese factory you will likely not be able to reach them near or during a holiday. This won’t mean that they aren’t reliable it just means they’ve shut down for the holidays. China factories sometimes work with skeleton crews a few days prior to the holidays and before their re-opening date. There may be production happening but it’s a fraction of a factory’s normal throughput. This is why communication remains limited and you should coordinate with your supplier early enough to confirm your orders and shipments.
UNDERSTAND THEIR BUSYNESS WHEN THEY RETURN
Know that when factory personnel return to their factories they will be extremely busy as will the truckers, the material suppliers, as well as the port and customs personnel. Because of this timing from the factory to when the shipment is loaded on a ship and that ship leaves the port could take much longer after a holiday than during “regular” times. Also, a factory may be shut down for a few days or weeks but that doesn’t mean they won’t have orders to fill upon their return. You can also expect ports to be just as busy, if not more so.
Therefore, when you order from your supplier, you’ll not only want to order early to cover the holidays, you’ll also want to order enough supply to last a few weeks AFTER the holidays. If you don’t, then you can expect delays if you expect to order immediately after the factory re-opens after a holiday.
