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Sourcing Manufacturers Outside of China?

Are your suppliers located in China? Are you struggling due to rising costs and extra tariffs? Looking to move your supply chain outside of China and save costs?

With the trade war between the US and China, more and more companies sourcing from China are considering other options. The increase in import tariffs is up to 25% in some cases. Therefore, importing from other countries besides China can simply save costs on tariffs.

Here are the labor costs in 2020 for countries located in Asia. It shows that labor costs in India, Cambodia, and Vietnam are the lowest. They are the popular back up manufacturing countries for companies to consider.

So, is it easy to save costs by sourcing outside of China?


Since 2019, SVI have been working on sourcing outside of China for our customers. Here are our insights regarding sourcing in Vietnam, India, Cambodia, and other countries.


Although sourcing in countries like Vietnam and India have very low labor costs, they do NOT necessarily provide lower costs than China. One reason for this is because a lot of raw materials must be imported to these countries from China.


Sourcing away from China requires more work, longer lead times, lower product quality, dishonest suppliers, slow response in communications, and expensive tooling cost.


Overall, companies need to spend more effort on the above factors with suppliers in Vietnam and India than they do when working with Chinese suppliers. But you can hire SVI to work out all of the solutions for you , check out what SVI can help.

With that in mind, you have to source from these countries wisely. Here are the best-suited product categories you can source from each country.


Vietnam

Vietnam has seen apromising pattern of export growth, particularly Electricalmachinery and equipment and Footwear products.

India

India has seen a promising pattern of export growth, such as travel/tourism and Industrial Machinery products.


Cambodia

Cambodia has seen a promising pattern of export growth, particularly apparel, knit and travel and tourism products.


It is the time to make back up plans for your supply chain so you don’t fall behind. If you want to learn more info and are interested in hiring SVI to be your sourcing agent in Asia, contact us now.