How can you get the most bang for your buck when producing your product? For many entrepreneurs, the answer is China product development. Contrary to popular belief, developing your product in China can be a cost-effective way to get it out there in front of customers who are looking for exactly what you’re offering at an affordable price point. And as an added bonus, you’ll be working with some of the best engineers and designers in the world to make sure your product gets made correctly without issue. Here are five of the most common reasons why China product development might be the right choice for your business at this time.
Lower Cost of Labor
In China, the average factory worker earns a fraction of what workers in North America or Europe earn in wages, which leads to savings of each product unit that has been created. Due to this lower rate of labor cost, there’s no need to build a new factory. The existing infrastructure and skilled work force in China can provide all the production needs of your company without breaking the bank.
But just because factory workers there don’t get paid as much doesn’t mean they treated unjustly. For every dollar an American manufacturer spends on labor, an estimated 18 cents goes to administration costs. In China, only 2 cents per dollar go towards administrative costs—the rest goes directly into the pockets of Chinese factory workers.
Factory conditions have been tremendously improved for workers over the years. Manufacturers are required by law to meet certain standards and provide their employees with benefits such as health insurance, retirement packages, and education subsidies. Workers now often have the opportunity to learn skills such as quality control at the manufacturing facility where they work so that when they can actually make a career out of it.
Technology Expertise & Sustainability
China has been a leader in developing high-tech products and experience with different types of manufacturing in recent years. In fact, they produce many of the top brands that are sold on our store shelves and they continue to innovate with new technologies and ideas.
The motivation for technology innovation in China does not only come from business, but also from policies and government support, such as Made in China 2025. The goal of Made in China 2025 is to transition China from being a low-end manufacturer to one that produces high-end goods. The goal is to target China’s wealthy middle-class consumers and take advantage of China’s expertise in export manufacturing.
As their economy continues to grow and evolve, it’s important to note that one major trend is the movement towards more sustainable development and a green economy. As such, an emphasis on renewable energy sources and emissions reductions are driving increased investment in clean tech research.
Local Talent Pool
With a population of over 1.4 billion people, there are plenty of skilled engineers, designers and factory workers to hire from in China. This means that if you need more resources, it’s fairly easy to get them in a variety of different fields to supplement your team. The plethora of available talent also makes it possible to have your product manufactured at a lower cost, saving money and increasing profits while maintaining quality on every unit sold.
Other than local college graduates, there is a very decent number of Chinese talents with western experience available every year. Many of them return back to China after earning their education abroad. These professionals can provide valuable input into how your design can be altered or improved to meet market demands better as well as offer new ideas when developing prototypes or piloting new products. They can also take care of testing, production and logistics so that you don’t have to worry about anything but sales and marketing!
Global Manufacturing Experience
A significant cost benefit of using a China product development company lies in their experience. Manufacturers there been manufacturing products for clients in North America, Europe and Asia for decades. Their experience has well well equipped them to engineer fast and high-quality manufacturing at competitive prices. With such a vast network of the world’s best suppliers and manufacturers, they can achieve many efficiencies which give you better pricing on your product than if you sourced from elsewhere.
Because of their global experience, communication with them is much easier than those in many developing countries. They have fluent English speakers, as well as Mandarin speakers who are able to communicate between English speaking customers and Chinese suppliers. The cultural experience of these companies is also something that should be considered when choosing where to develop a product.
Full-Fledged Infrastructure
China has an extremely well-developed supply chain and manufacturing infrastructure. From low skilled labor to hi-tech suppliers, it is difficult to find a product that can’t be made in China. This puts any company at ease when trying to make a scalable decision about their product development in order to grow their business as quickly as possible. Because of this, you are also able to iterate prototypes more efficiently because of how extensively developed their manufacturing industry is.
When your product gets to the phase of transportation, China can provide seven out of ten the world’s busiest ports. In addition, over 80% of the global air freight capacity comes from China. As a result, they have great logistics infrastructure which allows you to send products anywhere in the world quickly and cheaply.
Thanks to a diverse talent pool and scalable operations, China product development is the most cost-effective option. But there are also many other reasons that might be more suited to your specific business needs. With 17 years under the belt, our team can help you with a worry-free product development process so you can bring your new product to market quickly and affordably. For more information, contact us today!
