Our Secret List of Really Bad Manufacturers Around the World

1. We have no such list. Sorry.

Pretty much every week, someone writes one of our international manufacturing lawyers about the following:

1. To ask about a particular overseas manufacturer;

2. To complain about a particular manufacturer and to ask us to tell our blog readers about this company or report them to such and such government or embassy or to ask; and/or

3. To ask us whether we have or know of a list that ranks manufacturers on their trustworthiness/reliability/quality;

4. To ask if they buy “through” Alibaba whether they will “be protected.”

2. Foreign Company Due Diligence

Our standard response to those seeking information about a particular manufacturer is something to note that there are hundreds of thousands of contract manufacturers around the world and our international lawyers have worked with just a small sliver of those and we are not familiar with XYZ company. We can though help you determine the reputation and the financial wherewithal of XYZ company by conducting due diligence on them, which is something we do recommend be done on any foreign company before you send money.

3. Reporting Bad Foreign Manufacturers

Our standard response to the request that we report bad suppliers on this blog is that we do not list problem manufacturers (or great manufacturers) because we have no good and fast way to determine that what one person tells us about a particular manufacturer is accurate or not. To be blunt, much of the time when product buyers have problems with their overseas manufacturer, the fault does not lie solely with the manufacturer. As far as us reporting X manufacturer to Y government or Y embassy, that virtually never has any impact and so we would not feel right charging anyone for us to do that, but there is, of course, nothing stopping you from doing that.

3. Foreign Manufacturer Lists

Our standard response to whether we have or know about a list that ranks manufacturers on their trustworthiness/reliability/quality is that we have no such list nor is there any such list we recommend. I then usually suggest that if they do not deem it worthwhile to spend money for due diligence on their potential suppliers they should at least do a Google search on them.

4. Alibaba’s Protections SUCK 

My standard response on whether buying “through” Alibaba will “protect” them is no. Alibaba Trade Assurance has been and will always be borderline worthless. I know nobody who has ever had a good experience with it and plenty who have not.

Finding the right manufacturer overseas is not easy and, if anything it is getting more difficult because it typically involves more countries than in previously.  See The China-US Trade War and the Winner is….MEXICO and The US-China Future: Meet Vietnam, Thailand, Mexico, Malaysia, India, Indonesia,Taiwan, Turkey, and the Philippines.
A few weeks ago, I got an email from a self-described “avid” reader of this blog with the following question:

I am looking to have XYZ widgets made in either China or Thailand but I don’t have enough money to hire anyone to help me with product sourcing or even to visit the factories before I choose one. I also cannot afford any legal help for my contracts. What do you advise I do to protect myself.

My response was the following sentence: “My advice is that you wait until you have more money and, if possible, you in the meantime start out strictly domestically.” The reader responded with one word: “Thanks.”

Whenever I speak about how to protect yourself when doing business overseas I talk about the following as the three keys:

1. Good partner. In other words, be sure to choose a good supplier and the right supplier for you.

2. Good contracts. Your contracts should be enforceable in the relevant country and they should protect you from key risks, such as IP theft, bad product or late deliveries.

3. Good IP registrations. Trademarks, copyrights, patents, and/or trade secrets.

I sometimes add a fourth: good quality control/good monitoring.

There are no shortcuts. And there is no list. Sorry.