George-Tech Frequently Asked Questions (FAQs)

1. We have reduced our purchasing costs significantly over the last few years but we still need to do more just to remain competitive. We know that some of our competitors are working with oversea suppliers but we feel that it is too risky for us - how do we do it?

Working with oversea companies has its risks. George-Tech has developed an approach to get companies up and running rapidly with oversea manufacturers. It is suggested that a gradual ramp up is used instead of a big bang approach. Of course, some companies need to take more drastic action just to survive.

2. We have heard that it takes many months, if not years, to get up and running with oversea suppliers. How do we collapse the time scales?

You are right, establishing a good working relationship does take a very long time with any oversea suppliers, particularly in China. The Western system works using legal contracts. In China, however, business is done on the basis of trust (known as Quanxi in Mandarin) and is much more important than legal contracts. George-Tech can help you get started with development and purchasing from China in a matter of days.

3. Product quality is an issue with oversea companies. How do we make sure that we get world class quality levels from our oversea suppliers?

Chinese manufacturing companies are known to have notoriously low quality levels. George-Tech understands the importance of producing quality products to you without costing an arm and a leg, or worse, to produce something that is both cheap in pricing and inferior in quality and can not be accepted in the market place. We are aware and proceed in compliant with quality system and international standards. In addition, George-Tec can provide various independent quality inspections (including raw material and/or final inspection). You should consider the fact that many “quality” Western and Japanese products are now actually made in China – next time you buy a mobile phone or TV just look at where it is made!

4. What types of parts and products are suitable for manufacturing in China?

Although most types of products and parts can be made cheaper in China, the bigger savings are with those which have high volume parts and products that require labor intensive operations. Having parts or products that are stable and are not subject to frequent design changes also helps but is not essential. Even with airfreight costs, tooling and molds can offer huge financial benefits.

5. How do we make sure that sourcing from China will not increase our overheads in Purchasing and Finance?

George-Tech has established a network of companies that will provide a “door to door” service for you. This includes quality inspection, Chinese Customs Clearance, Shipping, Insurance, Customs Clearance and delivery to your factory. we will provide an “all in” quote with the service elements that you require so that you can compare costs with local suppliers. George-Tech does all the “administration” for you.

6. How should we start making parts in China?

George-Tech suggests that you start in a small way to gain confidence in working with us. Identify parts that you currently purchase from local suppliers and get quotes through George-Tech to quantify the benefits.

7. Are there any special Contract Terms?

Chinese companies are reluctant to do business with new overseas companies on a credit basis. George-Tech has secured more favorable terms than is normal in China with the main suppliers. Even so, you should expect to pay a down payment and use Letters of Credit.

8. What are the next steps?

After a few months you will become confident in working with a small number of Chinese suppliers. There are a number of potential next steps and the most appropriate course of action will depend on your unique circumstances. Getting George-Tech involved in your design process may be the right move. As your new low cost suppliers have changed your business economics your make vs buy criteria should be reviewed. Sourcing sub-assemblies or the complete outsourcing of products could give you the edge over your competitors. You could go as far as establishing your own operations in China (Representative Office, Joint Venture or Wholly Owned Foreign Investment). Your next move should be more than just “cost down” it should offer you sustainable competitive advantage.

9. What does George-Tech provide?

Being a quality manufacturer, George-Tech also has close working relationships with "Quality” providers. It is these connections that will allow you to quickly source engineered parts and products from these companies. The proven quality of these companies also de-risks the sourcing of parts and products from China. George-Tech also takes the hassle out of managing the global supply chain (customs, shipping, insurance, etc.) and provides a door to door service, if needed.

10. How do I contact George-Tech Services?

Email: info@george-tech.com