Chinese Manufacturers Cut Corners

Chinese products have been under increasing scrutiny since the pet food scandal that came to full bloom earlier in 2007. The United States has filed complaints to the World Trade Organization and it doesn't appear as though European countries are happy with Chinese tactics and quality either. However, China has the rest of the world acting like drug addicts with its cheap products where there is little to no alternative. Some may wonder why Chinese products are so low in quality.

In order to understand how Chinese manufacturing works we should look at one of their biggest exports. China produces nearly 70% of the world's toys. Not only does the U.S. buy from China but also countries like Iran, Saudi Arabia, Russia and many others. Children all over the world are receiving these toys for Christmas and Ramadan.

One of the reasons why China has been so successful manufacturing toys is because most families would prefer to purchase many cheap toys for their kids rather than fewer expensive ones. Families are going for the biggest bang for the buck. In third world nations every dollar counts and the purchase of toys can put a family into hardship.

One of the reasons why Chinese products are lacking is because there is only a 2% margin of profit on toys. In order for Chinese manufacturers to make profits they will use cheaper and cheaper materials to save money. Therefore quality keeps withering down as manufacturers look for ways to increase profits. For many Chinese companies they have been able to increase profit margins to 10% by using cheaper materials.

With Christmas around the corner most toy manufacturers are filled with orders. The pressing timelines are creating stress within many of these companies to be as efficient as possible. Any slow down in production will likely put the whole schedule in jeopardy. Those products that can't be shipped before Christmas will be a partial waste of revenue. Therefore some companies are starting to cut corners and this reduces quality.

Inspections in China show that during this current upswing in toy manufacturing a total of 20% of toys has some flaw. These flaws range from higher than average lead, parts that break easily, or poor quality. Even though a percentage of toys are tested many of these flawed toys will make it to market because not all of them can be tested effectively.

It is difficult to get China to be accountable for their poor manufacturing process. An import company does not often have direct contact with the manufacturer and in many cases their concerns brought to the government go unheeded. Therefore, it is difficult to get money back on poor products, to force government action or to hold the manufacturer responsible. Import companies are likely to push the products on to their customers.