Many importers have some misunderstandings about trading companies, thinking that they are middlemen who purely make money from the price difference. In fact, different partners have different characteristics and advantages. Through this article, you can understand the characteristics of a trading company and the type of trading company that is most suitable for you!
In China, there are many types of trading companies that cater to different needs and industries. Here are some common types:
General Trading Companies:
These companies offer a wide range of products and services in various industries. They act as intermediaries between buyers and sellers, facilitating transactions and providing logistical support.
The supply of goods for this type of trading company depends on the factories surrounding the location. For example, there are many electronic product trading companies around the Huaqiangbei business district in Shenzhen, and trading companies in Yiwu, Zhejiang provide various small commodities.
If the importer purchases dozens, hundreds or even thousands of products in multiple categories at the same time, then this type of trading company is a good choice.
Specialty Trading Company:
Specialty trading company focuses on a specific industry or product category. For example, there are trading companies that specialize in electronics, textiles, machinery, etc.
These companies have in-depth knowledge and expertise in their respective fields. In a professional field, a manufacturer often produces product models that it is good at, rather than all products. This makes procurement more difficult for importers. If you find it difficult to find suitable manufacturers of different models of products, you can leave this job to such professional trading companies.
In fact, in terms of communication, professional knowledge and service, there is no difference or even better between professional trading companies and professional manufacturers.
Purchasing agent trading company:
Purchasing agents help overseas buyers find suitable suppliers in China. They assist with supplier selection, negotiations, quality control and logistics. Purchasing agents are especially helpful for buyers who are new to the Chinese market and need help navigating complex purchases.
The above two trading companies are suitable for relatively mature importers, who are often local dealers, supermarkets or importers with physical stores. Many importers are small businesses or even just start-ups. They may be Internet sellers, or they may want to start a business on Amazon or try to sell goods on social media. They don’t know much about manufacturing in China. In this case, the one-stop service of the agency purchasing trading company directly solves all the problems.
Procurement agency services generally include:
- Supplier investigation and screening
- Assist price negotiation
- Sample confirmation
- Order follow-up management
- Quality control
- Logistics coordination
- After-sales service
Export Trading Company (ETC):
ETC specializes in exporting goods produced in China to international markets. They work with manufacturers to export products to overseas buyers and often provide value-added services such as quality control, packaging and shipping.
Import trading company:
Import trading company specializes in importing goods from overseas markets to China. They work with foreign suppliers to import products into China and then distribute them to domestic buyers.
When choosing a Chinese trading company, you can consider which one is suitable based on your actual situation.
For the above types of trading companies, there is a saying in China: choice is greater than effort. The right choice is often half the battle. I hope every importer can meet the most suitable trader.