With so many vendors selling a wide diversified array of products on online B2B platform such as Alibaba, you might be tempted to develop new products with those vendors.
Most of time, Chinese vendors propose their own products on the shelves. They sometimes also propose to design and engineer your product by developing them for you, generating a prototype, managing tooling, managing certification etc…
One might think it can be easier to develop your products directly with a Chinese factory or manufacturer thinking : ” this manufacturer already produces a product similar to mine so they will be able to make my product too”. Well the reality is sometimes a bit different and I will explain why in this short blog article:
# There are mostly two types of design and manufacturing profile companies in China
Type 1: The manufacturer is integrated vertically
This type of manufacturer got production line and engineer in house. Be careful when we say engineer, we mean a real engineer. Not the kind of engineer who is capable to open a CAD file and make it turn in every direction without understanding anything. We are talking about an engineer capable to modify a CAD file quickly based on request, capable to perform necessary simulation and optimization on the part. For electronic engineer, this is the same: he needs to be capable to modify the design, generate simulation and above all he needs to be able to explain you why and how he make this modification.
They have capability to be vertically integrated, hence to operate change and modification on your design directly, quickly and internally (without your idea, IP and design to go out somewhere else, so in this case your NDA will be usefull to protect you). They know the cost to change or modify something very quickly and this is a very advantage when you need to discuss pricing because everything go fast and smooth.
Drawbacks : None
Type 2: The manufacturer doing only assembly and sub-contracting the design and engineering
This type of manufacturer will sub-contract the design because they don’t have the resources internally to perform design and engineering. Still they will claim to do the design and engineering themselves to comfort you.
Your communication is going to be complicated because you will never be in direct with the engineer who manage your project. Your project IP will go somewhere you can not control. Somewhere where your idea will potentially be shared to other manufacturer. Now, imagine you are in a meeting you need to discuss pricing and to optimize it. You may need to decide to drop some functions on your PCB or change design on a plastic part. If the designer is not internally to the come company then you will hear many times “wait I need to call the engineer (aka the sub contractor)”. Not only the process will be slow but the more you will ask about this, the more they will be pissed off answering.
Think twice before deciding how to manage with product development of your new product in China
very interesting topic, great post.