Trading company or foundry ?Sometimes, customer thought it's better to trade with foundry directly is much better and the price is much lower. Is it right?

Position: Home > Trading company or foundry ?

 

Advantages of trading companies:
A. More information, faster absorption, if these can be effectively integrated and used by customers, it can bring value to the customers.
B. Communication with customers is relatively faster. If customers have problems, they can communicate face to face at any time through a phone call, so that they can respond more quickly to customers' ideas and plans.
C. the specialty of trading companies is how to bring comprehensive and effective solutions to customers, rather than just being a product provider, which is quite different from factories.

Many customers are trying to collect the information of domestic factories in China. We think it can reduce the cost, but in general, it doesn't mean much.

More than 90 percent of China's foundry factories do not have access to the international market, so foreign customers will not be able to collect their contact information.
The factory information they can find has a specialized foreign trade department or foreign trade company to operate overseas market expansion, so the foreign trade cost has been added to the factory's operating cost.
There is nothing wrong with an independent foreign trade company. It is the need of social division of labor, and it is not a wise choice to simply bypass foreign trade companies and do business directly with factories.
Trading companies are born out of information inequality,
Now many companies are willing to purchase directly from manufacturers, hoping for a lower price. In this sense, the profit margin of trading companies is getting smaller and smaller.
But as long as information inequality persists, trading companies will exist, and the former will never disappear, and the latter, of course, will never disappear.
Even if all the information is equal, the huge amount of information screening also needs to be done by special personnel. Even if the factory directly casts sales, the sales/foreign trade department should be set up to deal with the import and export procedures, so that the wholesale business is better than the retail business.
In this sense, trading companies will never disappear, but are increasingly inclined to charge agency fees.
This is for industrial raw materials. For retail, a large number of well-known retailers ask other companies to purchase on their behalf, and trading companies are essential. Many people can sew themselves, but most of them go to the mall to buy clothes to wear, right?This is the need of social division of labor. So trading companies always exist, but more and more tend to general profit.

Advantages of trading companies:

A. More information, faster absorption, if these can be effectively integrated and used by customers, it can bring value to the customers.

B. Communication with customers is much faster. If customers have problems, they can communicate face to face at any time through a phone call, so that they can respond more quickly to customers' ideas and plans.

C. The specialty of trading companies is how to bring comprehensive and effective solutions to customers, rather than just being a product provider, which is quite different from factories.

D. By the law in China, the foundry don't have the rights to export the goods directly. 


Many customers are trying to collect the information of domestic factories in China. We think it can reduce the cost, but in general, it doesn't mean much.

More than 90 percent of China's foundry factories do not have access to the international market, so foreign customers will not be able to collect their contact information.

The factory information they can find has a specialized foreign trade department or foreign trade company to operate overseas market expansion, so the foreign trade cost has been added to the factory's operating cost.

There is nothing wrong with an independent foreign trade company. It is the need of social division of labor, and it is not a wise choice to simply bypass foreign trade companies and do business directly with factories.


Trading companies are born out of information inequality, now many companies are willing to purchase directly from manufacturers, hoping for a lower price. In this sense, the profit margin of trading companies is getting smaller and smaller.

But as long as information inequality persists, trading companies will exist. The former will never disappear, and the latter, of course, will never disappear.

Even if all the information is equal, the huge amount of information screening also needs to be done by special personnel. Even if the factory directly casts sales, the sales/foreign trade department should be set up to deal with the import and export procedures, so that the wholesale business is better than the retail business.

In this sense, trading companies will never disappear, but are increasingly inclined to charge agency fees.

This is for industrial raw materials. For retail, a large number of well-known retailers ask other companies to purchase on their behalf, and trading companies are essential. Many people can sew themselves, but most of them go to the mall to buy clothes to wear, right? This is the need of social division of labor. So trading companies always exist, but more and more tend to general profit.