Sourcing · 9 min read
China Sourcing 101: Verify a Chinese Factory in 10 Steps
The exact ten-step protocol Makehe uses to qualify a Chinese factory before any payment moves — from AIC license to on-site audit.
Most of the China-sourcing horror stories you hear — the empty container, the wrong specs, the "factory" that turns out to be a four-person trading desk in a Shenzhen apartment — share the same root cause. Someone skipped due diligence to move fast. Here is the exact protocol we run on every new supplier, ordered by how often each step catches a problem.
- 01
Pull the AIC business license
The first hard signal. A real Chinese factory has a Unified Social Credit Code (统一社会信用代码) — an 18-character identifier you can verify on tianyancha.com or qichacha.com. Match the licence holder name to the bank account name. Mismatches are the single most common indicator of a trading-shell pretending to be a manufacturer.
- 02
Verify export rights
Not every Chinese company can export directly. Check whether the entity has its own customs registration number (海关注册号). If they don't, your order will move through an agent — adding cost, complexity and a hidden counterparty.
- 03
Cross-check on Alibaba, Made-in-China, GlobalSources
Search the company name (not the storefront name) across all three. Look at registration year, response rate, and whether they have a Gold Supplier badge backed by a third-party verification report. Storefronts under 2 years old need extra scrutiny.
- 04
Demand third-party audit reports
Request recent SGS, TÜV, BV, Intertek, BSCI or SEDEX audit reports. Read them — don't just check the box. Capacity numbers should align with their lead-time claims. Worker headcount should fit the stated MOQ.
- 05
Ask for reference clients
Three reference clients in your category. Ideally clients in a market other than yours so they'll speak freely. A factory that has only sold "to Africa" and won't name a single customer is a red flag — even if the factory is real, your category may be outside their core competence.
- 06
Video walkthrough of the production floor
Schedule a live video call on WeChat. Have them walk the production floor — not a meeting room. You want to see machines in operation, current WIP (work in progress), and the QC bench. Stitched showroom footage tells you nothing.
- 07
Sample with full spec sheet
Pay for samples even when offered free. Provide a one-page spec sheet covering materials, dimensions, tolerances, finish, packaging, and labelling. The fidelity of their sample to your spec is the single best predictor of bulk-run quality.
- 08
On-site audit (or hire one)
For orders above USD 20k, an on-site audit by Makehe staff or a third-party (SGS, AsiaInspection, V-Trust) costs around USD 300–500 and is the cheapest insurance you'll ever buy. We grade across capacity, equipment, QC system, social compliance, and financial signals.
- 09
Pre-shipment inspection, AQL 2.5
Never release the final 70% payment until pre-shipment inspection (PSI) is signed off. AQL 2.5 sampling, function tests per spec sheet, label and packaging check, photo/video report within 24 hours. We will not advise releasing payment without it.
- 10
Lock the relationship in contract
A bilingual (English + simplified Chinese) Master Services Agreement with Chinese jurisdiction clauses is enforceable in Shanghai courts. Add penalty clauses for delivery slippage and quality defects. This single document changes the negotiating dynamic on every future order.
Bottom line
You don't have to run all ten steps yourself. The point is to ensure they happen — by your team, by a third party, or by an intermediary like Makehe. The cost of running them is a small fraction of the cost of skipping them.
Next step
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