November 22, 2021
The times where “Made in China” was a sign of fast-produced and cheap products are changing. Many factories have become modern and a shift from low-end manufacturing to higher-end manufacturing is recognizable.
Sourcing via Chinese manufacturers has become indispensable. But identifying a supplier is time and resource intensive. Check out our general blog post about verifying suppliers here.
Language barriers as well as the distance to the factory are factors that make it way more complicated to find your right business partner – especially if you are looking for a supplier in China.
In the following, we provide five helpful tips and tricks to verify a China-based company that go beyond checking “gold” or “verified” supplier ratings on Alibaba or other sourcing platforms such as Global Sources and Made in China that connect buyers to Chinese manufacturers.
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Every authentic business in China owns a business license and registration number. You can ask a potential supplier to show you their documents in order to check their legitimacy. The business license discloses the business scope (经营范围). Check for the business scope to be “produce” (生产) or “manufacture” (制造).
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More generally, the Chinese registration number , also known as Unified Social Credit Code (统一社会信用代码), consists of 18 digits and is handed out to all businesses by the Chinese government.
Nowadays, business licenses also consist of a QR code that you can scan to confirm a business’ authenticity.
Once you have the registration number at hand, you can doublecheck the document’s authenticity in the National Enterprise Credit Information Publicity System (NECIPS), which is a Chinese governmental database.
The database is, however, only available in Chinese.
Chinese manufacturers who export goods, need two important documents.
1) China Customs Registration Certificate (中华人民共和国海关报关单位注册登记证书) issued by Chinese customs
2) Foreign Trade Operator Record (对外贸易经营者备案登记表) issued by the Ministry of Commerce.
Only if manufacturers possess these certificates, they can apply an import/export permit. The above mentioned documents can be checked also at the official government database. To do so, however, you need an account to verify the details. As the database is only accessible in Chinese, you may need support from a third-party to look up the details for you. As we have access to the database, you can reach out to us directly for support in this matter.
The database of the Chinese Supreme Court makes information on previous legal issues visible. You must simply type in the Chinese company name and see if the supplier is stated on the site. Details on the website include whether the company was given a sentence and if they failed to pay damages. Unfortunately, this site is available only in Chinese. So you might also need help from a third-party to translate the matter to you.
If your potential supplier claims to be a larger manufacturer, you can ask for their factory auditing report to check their previous performance. If the manufacturer was never audited, you could also assign a third-party provider to audit the factory on your behalf (in consultation and cooperation with the respective manufacturer). Whether you review an existing audit report or appoint one yourself, we suggest to investigate the following:
To prevent stress, to ease your mind quickly and to save time all at the same time, you can order a Chinese company verification report from third-party authentication service. Via such reports, you will get a compact information for various checks. Mostly, you will get valuable insights about legal representatives, the shareholder structure, business scope, trade mark and patents, legal activities and other information.
Our Shiftery verification report can, for example, be helpful for:
The main benefits of these reports are that you have reliable information fast. Our Chinese company verification report, for example, can be issued within 24 hours, which means you do not lose momentum but get valuable information at a reasonable price.
Reach out to us at hi@shiftery.io to get your company verificationreport for only $99 or order it directly on www.shiftery.io/verification-report
To summarize, Chinese databases can easily support you to identify a Chinese entity’s authenticity. The language barrier, however, is a hurdle to tackle.
Using third-party services to be on the safe side, especially for large order volumes for high-quality products, will ease your mind and make sourcing in China worthwhile.
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