Sourcing from China: a guide for UK businesses

Start with landed cost, not unit price

Landed cost is the full cost of getting a product to your warehouse: unit price, packaging, freight, insurance, import duty, customs clearance and inland delivery. Add the cost of stock in transit and any quality inspections. A lower ex-works price can disappear once these are included. A should-cost model helps test whether the quote is fair.

Finding China suppliers and manufacturers

There are many China suppliers listed online, but a listing tells you little about capability. Chinese manufacturers tend to cluster by product and region, so start by identifying where your category is made, then build a long list from trade data, trade fairs and trusted referrals. Aim for 10 to 20 candidates before issuing a request for quote.

Factory in China or trading company?

Many suppliers present as a factory in China but act as trading companies. Trading companies can be useful for small or mixed orders, but they add margin and distance you from quality control. Check the business licence scope, visit or audit the site and ask to see production lines running your type of product.

Sourcing products from China: the process

• Write a clear specification and target landed cost
• Shortlist manufacturers in China and issue a structured RFQ
• Compare quotes on the same Incoterms basis
• Assess samples, then audit the preferred sites
• Negotiate price, MOQ, payment terms and tooling ownership
• Inspect before shipment and track the first orders closely

Vetting suppliers

• Confirm the business licence and whether you are dealing with a factory or a trading company
• Request references from existing export customers
• Commission a factory audit before large orders
• Check that the supplier can meet UK product safety and labelling rules

See supplier audit and due diligence for how we run this.

Quality control

Agree a written specification and approved samples before production. Use pre-shipment inspections by an independent firm, with clear acceptance criteria. Build quality terms and remedies into the purchase contract.

Duties, customs and compliance

Check the commodity code and duty rate on the UK Global Tariff. Confirm who is responsible for customs clearance under the agreed Incoterms. Some goods face trade remedies or extra controls, so check before committing. See import duty from China to the UK and how to import from China.

When to diversify

Single-country dependency is a resilience risk. Many UK firms now run a China plus one strategy, keeping China for some lines and adding a second country for others. Our supply chain resilience guide covers the trade-offs.

How Caventis helps

Our offshore sourcing service covers landed cost modelling, supplier selection, audits and negotiation for UK businesses buying from China and other countries.

Frequently asked questions