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Making the Best of China's Electronics Manufacturing Resources to Obtain Optimal Balance between Cost and Performance from Electronics Manufacturers

China's electronics manufacturing services (EMS) have been picked up as a common solution for world-wide companies concerning electronic products. Nevertheless, it has to be accepted that China's electronics manufacturers have been also blamed for low quality, inaccuracies or extreme low reliability. As one of the largest developing economies in the world, however, China has been featuring infinite development drive and opportunities and as long as they are made best of, optimal balance will surely be obtained between cost and performance from China's electronics manufacturers.

Chinese workers assemble electronic components | PCB Assembly

Chinese workers assemble electronic components at the Taiwanese technology giant Foxconn's factory in Shenzhen, China. AFP/ AFP/ Getty Images

Why Manufacturing in China?

First, China is rich in resources supporting smooth electronics manufacturing. Thanks to a large domestic demand, relatively low labor cost and comprehensive supporting industries, China has become one of the largest countries providing electronics manufacturing services. Specifically, China has become No. 1 among countries around the globe providing electronic manufacturing in that its PCB (Printed Circuit Board) manufacturing has surpassed Japan since 2006. Up to now, PCB industries rooted in China have covered approximately 50% of international business so that China has become the largest supply base of PCBs and PCBAs (Printed Circuit Board Assemblies). Moreover, traditional single/double-sided PCB boards and multilayer PCB boards are accounting for a decreasing proportion while high-tech and high-added-value PCBs are seeing a rising proportion such as HDI PCBs, Thick Copper PCBs etc. Such result isn't awarded by heaven but naturally selected.

Second, China features such steady political, economic and natural environment that there's no need to worry about product security, unpredictably prolonged delivery time or endlessly vacant expectation all of which are significant for electronic manufacturers. As one of the leading countries with economic impetus for vitality and energy, China has been focusing on the constant development of the nation and people in all aspects.

Third, China strives for gradual scientific progress with resolution to convert from "Made in China" to "Created in China". The truth can never be eliminated that China develops as a maker or copier. But if you still stick to that impression today, you'll be laughed at. China has ranked among top groups in electronics manufacturing industry. For example, some companies have achieved high level on top techniques such as Flex PCBs and Flex-rigid PCBs. Along with constant upgrading of PCB fabrication technologies, China has been witnessing a product structure going through steady optimization. Furthermore, a series of newly-established strategic industries have been set up including AI, big data and cloud computing all of which belong to high-level manufacturing domain based on product technology and manufacturing requirement.

Apart from the increased technology, awareness also rises in terms of environmental protection among electronic manufacturers in China. Recent years have witnessed increasingly rigorous regulations manufacturing companies have to abide by in environmental protection and some unqualified factories are even forced to be shut down just because their manufactured items go beyond environmental requirement. When it comes to electronics manufacturing, RoHS certificate and lead-free requirement stand for basic requirement on environment.

Fourth, as early as opening policy was implemented in China more than 30 years ago, China began playing such an active role in the stage of international trade that full-scale exportation promotions have been carried out. Just as President Xi Jinping once said that China suffered from the pain deriving from seclusion, China has been actively striving for opening and reform policies and playing an increasingly enormous role in international trade stage such as G20, APEC etc. Belt and Road Initiative especially has expanded China's international trade scope by connecting history and modern era.

How to Make the Best of China's Electronics Manufacturing Resources?

In spite of listed merits of electronics manufacturing in China, you should keep following rules in mind to avoid "hidden traps" set by irresponsible manufacturers.

Rule#1: NEVER believe too low prices

China stood out due to low prices primarily deriving from low labor cost, low raw material and mass production scale. Nevertheless, this isn't so today. Those elements mentioned above leading to low cost are no longer being held by China as Chinese government has been trying to break away from the name of resource-oriented country. The indispensible developing road is sure to be just a transition period to win development by sacrificing their natural resources. Thus, multiple limitations have been set to electronic manufacturers, especially in terms of environmental protection. Now that resources can't be freely used, the final cost will thereafter rise.

As a result, it's becoming increasingly difficult to find an electronic manufacturer rooted in China that can provide products with equivalently low cost as before. Furthermore, low prices usually look impractical unless you're holding tightly products totally compatible with your requirement. In a word, it's unrealistic to go for sheer low prices, even if in China.

Rule#2: Open door policy is one of the key aspects to testify the reliability of an electronics manufacturer

To ensure the authenticity and reliability of an electronics manufacturer or assembler rooted in China, it's highly-efficient and greatly necessary to pay a visit to capture your own conclusion. After all, there are so many electronics manufacturers in China and some so-called manufacturers are also available that are in fact middlemen. They claim to be manufacturers and are crazy about quotations. But the truth isn't as what they describe. They receive your quotation requirement first and then contact with numerous manufacturing factories in order to pick up the optimal one they regard. During this process, what they only concern is low cost and they take product quality for granted. Nevertheless, even the low cost has nothing to do with yours since middlemen have to gain the majority of benefit. At least, product quality and delivery time can NEVER be guaranteed.

Those companies with their own electronics manufacturing workshops go over a different way. They keep everything tightly in control and they are capable of providing certain replies to you. Moreover, those electronics manufacturers are willing to welcome customers to pay a visit to their companies or factories because they can't wait letting their customers be aware of their reliability.

Differences between electronics manufacturers and middlemen lead to their different attitudes to their customers' visit. The former naturally welcome their customers while the latter possibly refuse customers' visit demand by providing some reasons, which can be therefore one of the most important elements to evaluate the authenticity and reliability of an electronics manufacturer.

Rule#3: It's of much necessity to sign NDA with your cooperative electronic manufacturer

NDA, a short form of Non-Disclosure Agreement, is a primary way to protect your intellectual property from being disclosed. As your core competitiveness, intellectual property can never be compromised or leaked, or it will bring about catastrophe. It's been said that intellectual property is greatly challenged in China. It's partially true for unqualified electronics manufacturers. Up to now, each professional electronics manufacturer in China is able to sign NDA with their customers, which accurately regulates their responsibilities and obligations together with specific clauses. As long as such NDA is signed, there'll be no need to worry about the safety of your intellectual property.

Rule#4: A tip to save cost: to select freight collect

I've known that some companies say no to off-shore manufacturing, like in China, just because they have to pay relatively high freight fee. The expectation to reduce cost through manufacturing in China is broken by high freight fee is usually another key element letting go of manufacturing in China.

Based on my experience, it's extremely difficult to find out an electronic manufacturer who can provide free freight service. Even though such free service is provided, in accordance with the analysis in terms of current cost situation in China, do you think it accessible to simultaneously obtain high quality and free freight fee? I don't think so.

The optimal solution to defeat high freight fee is to pick up freight collect when it is possible. When your partnership with freight companies allows your companies to get a relatively low freight fee, it's definitely a good idea to make the best of such offer instead of paying for the freight fee arranged by your contract manufacturers. After all, the freight collect fee is transparent while freight fee provided by your electronics manufacturers may not be that clear.

To carry out electronics manufacturing in China is not a nightmare. However, it'll be a perfect selection when China's electronics manufacturing resources are best leveraged. As long as the rules discussed above are conformed to, you'll definitely find a reliable electronic manufacturer.

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