Why Do You Need a Sourcing Agent in Asia?
A sourcing agent in Asia leverages your company for greater potential growth and success.
Access to the internet positions the world at your fingertips. Timbuktu endures as a place of legend, but its distant landmarks materialize on your screen in the blink of an eye. Similarly, at the press of a button you can connect with manufacturers on the other side of the world.
It is possible to identify ‘partners’ from the comfort of your own home or office, prompting some companies to buy from suppliers at arm’s length. But they miss out on one of the most valuable services in their supply chain. Qualified sourcing agents in Asia introduce expertise capable of saving time and money along every step of the process. From identifying cost-effective sourcing materials to conducting audit-level quality control checks, professional sourcing agents devote care to managing their clients’ sourcing needs.
Why Source from Asia?
Improved manufacturing capabilities and low labor costs cement Asian sourcing opportunities as some of the most cost-effective in the world. Although China has been the dominant force for the past two decades, other regions such as Vietnam and India are developing a breadth of manufacturing.
At the government level, both China and India have committed to investing in smart manufacturing. Their efforts are developing a manufacturing base for the future that is driving efficiencies through technology.
With the implementation of the Belt and Road Initiative and “Made in China 2025”, China doubled down on commitments to increase transnational supply chains and advancing sustainable manufacturing techniques. One of the pillars of modern outsourcing, China has developed complex supply chains across a vast range of product categories.
Vietnam earns recognition as one of South-East Asia’s fastest growing manufacturing nations. With a lower cost base, it has a comparative advantage in certain categories. A wealth of free-trade agreements reinforce Vietnam as manufacturing hub of the future.
With a newly elected pro-business government, India is entering a bright era of skilled manufacturing and production. Best known for expertise in textiles and electronics, the nation is expanding their horizons with Prime Minister Narendra Modi’s “Make in India” campaign. Following the recent election, India is now committed to further investment in technology for the manufacturing sector.
How a Sourcing Agent in Asia Can Help You:
Sourcing agents in Asia can help companies of all sizes source in the region. Scalability and breadth of resource is something that is particularly beneficial. Whether you have just started searching or are looking to enhance your vendor penetration and supplier management capability, sourcing agents present opportunities that a direct sourcing model may struggle to find.
If You Have Never Explored Opportunities in Asia Before
You may feel the risks outweigh the benefits to give it a go without any support. There are certainly suppliers (on platforms like Alibaba) that warrant skepticism and may present pitfalls when it comes to product quality. Sourcing agents, especially those with more years of experience, are some of the finest domestic resources for building your new supply chain.
For companies looking to outsource manufacturing for the first time, entering the market with a sourcing agent in Asia that you trust is equivalent to sitting before a judge with an experienced lawyer as your counsel. They know how the system works and will ensure that your interests are protected whether quality or price.
If You Already Source from Asian Suppliers
A direct sourcing model requires ‘on the ground’ management. In whatever guise, having the ability to develop deep and meaningful relationships will put you in good stead in the future. Just as if your company was manufacturing in your local market, there would be an expectation that you would need to visit and have visibility of any production.
Of course, companies are now able to go direct to suppliers across Asia. It depends on resource and capability in the company doing the sourcing. For example, a sourcing company can help bridge the communication and time difference that companies outside of Asia will face.
There is also an opportunity to leverage breadth of resource and expertise which already exists in-house. When you engage directly with suppliers and manufacturers, you need to manage multiple relationships. With a sourcing agent at the helm, what used to be numerous check-ins, six with suppliers and two with third party quality control, reduces into a single meeting encompassing your entire supply chain.
If You Encounter Communication Issues or Inconsistent Quality
Vendor accountability can be one of the most frustrating aspects of managing your supply chain. If you don’t have visibility of your production until items are fully “produced,” there is a wide margin for error. Miscommunication and insufficient quality control can ruin entire shipments and waste hard earned cash.
Qualified sourcing agents and companies arrange quality assurance checks along every step of the process to ensure early identification of any issues and present viable solutions. From sourcing from certified suppliers to load monitoring inspections, some agents cover your entire supply chain with transparency. Others may only cover sourcing and require clients to hire their own third party services. Be sure to verify exactly which services your sourcing agent is willing to perform.
If You Plan to Expand or Launch New Products
While your current capability might be sufficient for the time being, you might want to grow in the future. Suppliers may not be capable of taking the next step forward due to their own limitations.
Sourcing agents specialized for your industry are well-equipped to help you expand your business. With a wide range of suppliers, sourcing agents can not only manage potential problems upstream at the factory, but also help you consider the best way forward.
Sourcing agents can also play an integral role in enabling companies to scale their businesses. The allocation of resource combined with local expertise can ensure that a broad supplier base is easily managed.
If your company plans to expand production in their five-year plan, now is the time to connect with a sourcing agent.
How to Choose the Best Sourcing Agent for Your Company
Identifying an agent or company which understands your sourcing strategy and drivers can be a challenge. To learn more about what factors to consider when choosing the best agent for your company’s individual needs, check out our last article here.
We at ET2C International value understand your needs whatever size of the company. We would love to discuss how our team can provide sourcing solutions for your individualized needs. No matter your current sourcing situation, our team can assess your current sourcing strategy and identify potential opportunities. Contact us to learn more about what we can do for you.