Business Daily Media

How to check the legitimacy of new Chinese supplier?

  • Written by News Co

1. Is your supplier a manufacturer or a trader?


What's the problem

70% of companies you find on Chinese marketplaces are not original manufacturers, they are intermediaries.

What can Company Inspector do

Company Inspector will check an official Chinese name of a company, its business scope, and number, position of employees, as well as registered trademarks and licenses.

How to use that

You will understand who you are dealing with and how they will be able to resolve issues related to product quality.


2. Do they have a valid export permit and experience in overseas sales?


What's the problem

If a company doesn't have an export permit, then most likely invoices will be issued from another entity. This is a risk of scam.

What can Company Inspector do

Company Inspector will check a permit expiration date and validity, analyze a company's shipments for the last 12 months in customs.

How to use that

You will make sure your supplier is involved in international trade, has clients abroad, valid export documents.



3. What is an ownership structure, who are the final beneficiaries, and risks in affiliated companies?


What's the problem:

Chinese owners may use one company as a cover for trade while keeping unprofitable and unreliable companies.

What can Company Inspector do

Company Inspector will analyze an entire group of affiliated business owners as well as key staff members and estimate the risk for every affiliated company.

How to use that

Know your supplier from all sides. You will see a list of final beneficiaries and risks that may harm your supplier.



4. How to estimate the size of the company


What's the problem:

Chinese companies can introduce themselves as large manufacturers or suppliers, but in reality it may be a small trading company with one or two managers. Therefore, they will redirect your order to other manufacturers or traders and as a result they will not be able to influence the quality of the products themselves.

What can Company Inspector do

Company Inspector will analyze the size of registered capital and compare it with the peer companies. We check financial information and the number of employees for the last four years. We also analyze job offers published by the company for several years.

How to use that

You can estimate the size of the company. This will help you to understand if you are dealing with a small company or with an intermediary instead of manufacturer, therefore reducing the risk of getting poor quality late.

5. How to estimate risks of dealing with an insolvent company


What's the problem:

The number of bankruptcy filings in China doubled in 2019 compared to 2017.

What can Company Inspector do

Company Inspector can provide financials of the company for the last four years. We check court cases and judgements. We analyze changes in the number of employees for several years. We can provide red flags on the company that indicate critical business risks.

How to use that

You can see the changes in the status of the company during the last few years and ensure in your contacts.

Do you want to check a new supplier with Company Inspector?

Business Reports

YouGov appoint Laura Robbie as CEO of the Asia Pacific region

A world of new opportunities  Market research and data analytics company YouGov is pleased to announce the appointment of Laura Robbie as CEO of the Asia Pacific region.  Miss Robbie previously held the role of Managing Di...

How to Sharpen Your App Development Skills

Mobile application development is a skill that you should take seriously. It's not the easiest task in the world, and it takes more than just technical know-how to be successful. If you want your app to succeed, you have to shar...

The four markers that define Australia’s best-in-class workplaces

What is it that has aided one-third of employers not to experience difficulties with recruitment in the current market, writes Servicely’s founder and CEO Dion Williams. We’re used to living with impatience. The scant few...

3 Tips For Balancing Business And Family

Running a business while also simultaneously being the head of the family can be a stressful challenge to deal with, but so many people out there do it. If you are living this kind of lifestyle and feel like you have too much go...

RBNZ Survey: majority of experts believe inflation has hit its peak

While inflation has likely hit its peak, homeowners should brace for further hikes to their mortgage repayments, according to a new Finder poll.  In this month’s Finder RBNZ Official Cash Rate Survey, 15 experts and econom...

3 Essential SEO Services To Help Grow Your Business

Did you know that 44% of businesses have an SEO strategy? SEO remains a powerful SEO strategy for everyone, from startups to businesses big and small, because the best search results determine who people contact. The digital...

Web Busters - Break into local search

WebBusters.com.au