"Factory Direct"? Really? Here’s Why 80% of Your 'Suppliers' Are Just Middlemen
Let’s be honest—if you’ve spent any time searching for machinery or industrial components in China, you’ve likely encountered this scenario:
“We are a professional factory boasting 20 years of expertise!”
(Translation: We’re actually a trading firm that just learned how to market like a factory.)
I’ve lost track of the number of times I’ve visited a so-called “manufacturer” only to discover:
• A minuscule office devoid of any production equipment
• A sales staff unable to answer basic technical inquiries
• A “factory tour” that leads to a relative’s workshop located several cities away
Here’s the harsh reality: 80% of the suppliers you find online—whether through Alibaba, Made-in-China, or even LinkedIn—aren’t legitimate factories. And among the few that are true factories, half have quality control standards reminiscent of a high school metal shop.
Reasons for This Ongoing Problem
1. The “Factory” Deception: Trading Companies in Disguise
• Scenario: You stumble upon a supplier with an impressive Alibaba profile, ISO certifications (likely fabricated), and rave reviews. After placing an order, you’re hit with delays, incorrect specifications, and excuses about “production issues” at their “sister facility.”
• Reality: They’re just a trading company. They accepted your order, outsourced it to the lowest bidder, and pocketed the difference.
2. The “Yes Factory” – Experts in Overpromising and Underdelivering
• Scenario: You finally locate a genuine factory. Their equipment seems reliable. But when you ask:
• “Can you perform CNC machining to ±0.01mm tolerance?”
• “Do you have a CMM for inspection?”
• “May I observe your QC process?”
• Their response: “Yes, yes, no problem!”
• Reality: Their “QC process” consists of one person visually inspecting parts with a caliper from 2008.
3. The “Ghost Workshop” – Unannounced Subcontracting
• Scenario: You approve a sample from the “factory.” Production commences, but suddenly the finish differs, tolerances are off, and lead times elongate.
• Reality: Your order was subcontracted to a rundown workshop that operates on limited machinery and luck.
How to Identify the Impostors (Before You Get Duped)
1. The Video Call Test
• Request a live video tour of their factory floor. No pre-recorded videos, no excuses.
• Warning signs include:
• “The boss is out today.”
• “Our internet is poor.” (Yet their WeChat messages come through instantly?)
• “The workshop is under renovation.” (And has been for years.)
2. The “Stupid Question” Technique
• Pose questions that only a true manufacturer would know, such as:
• “What brand is your wire EDM machine?”
• “How many shifts do your CNC operators work?”
• “Can I review your raw material inspection report?”
• If they hesitate or provide vague replies, they’re not actually producing anything.
3. The Documentation Review
• Genuine factories possess:
• Machine purchase receipts
• Employee payroll records (with actual employees, not just sales staff)
• Process control documentation (even if chaotic)
• Counterfeit factories have:
• Stock images of machinery
• A “general business license” (which anyone can obtain)
4. The “Surprise Visit” (If You Can Manage It)
• Optimal scenario: You arrive and witness real production.
• Worst-case scenario: You reach their “factory,” only to find a warehouse filled with products from other companies. (Yes, this does happen.)
What to Do When You Actually Encounter a Genuine Factory
Even if you hit the jackpot and discover a legitimate manufacturer, many still struggle with quality control. Here’s how to handle it:
- Hire your own QC inspector (don’t rely on theirs).
- Invest in third-party testing (like SGS or TÜV).
- Start small—never place a large order until they’ve demonstrated their capabilities.
Final Thoughts
I understand—everyone desires the “factory price.” However, pursuing the lowest quote generally results in:
• Your parts arriving late.
• Incompatibility and function issues.
• Incurring higher costs to rectify the resulting problems than you saved.
So, the next time a supplier insists they are “factory direct,” challenge them with a video call and some tough questions. If they succeed? Fantastic. If not? Keep searching.
Have you ever been deceived by a fake factory? Share your stories below—let’s commiserate!
P.S. If a supplier’s Alibaba store features an overwhelming number of product categories, they’re not a legitimate factory. Just a heads-up.
