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Evolution of Industrial Sourcing in China

For decades, China’s unprecedented economic development was supported by its success in manufacturing cheap consumer products. This well knows success has hidden another irreversible trend: the rise of a broad network of suppliers producing competitive and quality industrial equipments and parts as well as professional electronic systems.

Sourcing Evolution

In “Why industrial goods are going next” the Boston Consulting Group (BCG) explained the reason of this in 2003 already. Today, the real China sourcing opportunities are with quality suppliers of industrial equipment and high technology products. Many of them do not have world famous brand names yet, but these excellent factories provide unique value proposition in all technologies required for industrial and professional products (s.a. SMT lines, sheet metal forming, plastic injection molding, metal machining, control system design, visualization and display technology).

Photo Long Distance RunningNo one is pretending that the process of finding, qualifying and contracting these suppliers is easy. In fact, it is paved with numerous challenges and pitfalls. It requires a strong commitment, the ability to focus resources on the project and, often, a readiness to adapt some existing work practices. But the rewards are worth the effort: the creation of a sustainable competitive advantage with high barriers of entries. Companies in the industrial and high tech sectors that have developped strong ties with quality and reliable suppliers, have build a unique set of competitive advantages that will make them not only more profitable but also more flexible and more fit to face their business challenges.