Avoid Chinese supplier scams? How to achieve it? It is really a most frequently asked question from the overseas buyers. Here are some tips:
I.Verify if the supplier is legally registered in China
By online research in the government database, the overseas buyers are able to verify if the supplier company is legally registered. However, this is only the first step and minimum requirement for risk control. There are more that the overseas buyers need to do.
II. Do background check against the supplier
A legally registered company does mean safe trading. It totally depends on good luck to get a good supplier with integrity, which do the same as what they said and agreed. But it is always good not to give any opportunity for the supplier to play tricks, thus background check will be quite important to judge if the supplier so far is in good reputation. The overseas importers may check if the supplier has registered cases for being sued in the court, if the supplier has any negative records on its credit certificate, etc. Also, on-site visit to the supplier company will be necessary if big amount of money is involved.
III. Supervising of whole transaction process
Why is it important to supervising the whole transaction process? How can ensure that the supplier deliver the goods exactly you want, rather than something else or even rubbish? We suggest the overseas buyers to do inspection during, after production and before delivery, also do the on-loading inspection as well as discharging inspection, recording or notarizing the whole process, etc. i.e supervising from the beginning to the very ending until you get the right thing.
IV. Drafting tailored contract in advance
Drafting tailored contract means preparing a detailed and well written contract just for you. We notice that many overseas buyers use the same sales & purchase contract with difference suppliers or for different products, or even just with a simple PI instead of sales & purchase contract, which always cause big problems. Never neglect the important role of your lawyer in China, as there is a saying: Nothing is more expensive than a cheap lawyer.