Sourcing Electronics Products from China

In this episode of The Asian Seller podcast, Dr. Neale O’Connor talks about importing electronics products from China. 

Most Amazon sellers shy away from selling electronics as a lot can go wrong with a product that has many moving parts. However, if you find the right factory, do your due diligence, and conduct ongoing quality control, these categories can be quite profitable. 

neale o'connor- the asian seller

Dr. Neale is a Professor of Accounting at Monash University, Malaysia.

He is an expert on technology and innovation in manufacturing in China. He has spent 18 years in Hong Kong where he researched the modernization processes of Chinese firms, examining issues such as performance measurement, order qualification, and trust. 

His China 1000 project is the largest ever survey of operational risk issues for foreign buyers and Chinese suppliers. 

Most recently he has been undertaking factory quality audits for multinational clients and advising on operational and marketing improvements as Director of Ricebox.com.

He is the founder and editor of Tech Asia Youtube channel with over 14,000 subscribers. 

Key topics discussed: 

  • Dr. Neale’s background and work 
  • Overview of electronics manufacturing in China - products made, production hubs
  • Different types of electronics factories in China
    1. Trading companies, buying agents, wholesalers
    2. SME factory workshops
    3. Established factories – OEM factories
    4. EMS providers
  • What differentiates a factory producing good quality products from one producing products that don’t last long?
    1. They should choose the right components, especially battery
    2. They should have systems in place – material receiving, assembly to final QC 
    3. Proper packaging and separation from the environment
    4. Anti static – especially during soldering process
    5. Finger gloves avoid moisture during the assembly process 
    6. They should have dust free zones
    7. Do they OEM for established brands
    8. Do they have in-house design teams
  • Advice for new importers sourcing electronics  
    1. Begin with off the shelf product
    2. Delay setting up and ordering a tweaked product
    3. Use a trading company – if you cannot travel to visit the factory now
    4. Work with an OEM factory that has established relationship with brand names
    5. Redouble QC efforts beyond what is needed for a certain level of AQL
    6. Know your quality specs so you can have a good engagement/relationship with the 3rd party inspector
    7. Look for a factory that already has FCC, UL, CE certifications
    8. You do not want to be the first customer asking for such certifications 
    9. Ask for reference from other customers
    10. Don’t pay any money unless you have verified the business license, have reference, conducted a factory audit, had facetime communications with the factory
  • How suppliers cut corners and compromise quality
    1. Use substandard materials
    2. Outsourcing without telling you (have a clear conversation with them about this – i.e. our auditor is allowed to visit the outsourced factory)
    3. Process shortcuts
    4. Poor set up of assembly line for workers to do a consistent job
    5. Separation of electronics components
    6. Burn in room tests – takes time – they can cut corners on this process
    7. Replace lower quality components, like batteries inside your product
  • Dr. Neale’s services and contact information 

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