Industrial Clusters in China

China has remained the primary sourcing destination for daily commodities for decades, and it is poised to continue dominating global manufacturing in the foreseeable future.

One crucial aspect to consider when sourcing from China is the concept of "Industrial Clusters."

Each industrial cluster possesses its unique specializations, often catering to different markets. For instance, both Guangdong and Zhejiang are known for producing consumer electronics. However, in general, if your target market is Western Europe or the United States, it's advisable to seek suppliers from the Guangdong region. On the other hand, if your market extends to South America or the Middle East, Zhejiang might be your preferred choice. Notably, Yiwu market, located in Zhejiang, is renowned for offering affordable goods. The presence of people from Southeast Asia, the Middle East, and South America has transformed the city to the extent that you might not feel like you're in China when strolling its streets.

Why is this the case?

The industrial clusters in Guangdong were established with well-structured industrial parks and attracted numerous international manufacturers who adhered to organized manufacturing processes. In contrast, Zhejiang's factories had more humble beginnings, often rooted in small family businesses. Many entrepreneurs lacked extensive formal education, and these companies tended to be less organized. Even today, Zhejiang remains home to numerous small family businesses.

Beyond these prominent clusters, there are also others like Shandong and Jiangsu, each with its unique industrial strengths.

Furthermore, there are numerous sub-industrial clusters within almost every county or town affiliated with these main clusters. For example, Chang'an in Dongguan is famous for its mold manufacturing, while Shunde specializes in home appliances.

In recent years, due to rising manufacturing costs in central cities and a shrinking working population, new industrial clusters have emerged in the distant inland areas of China. Today, you can find many industrial clusters in Henan, Hunan, Jiangxi, Sichuan, Hubei, Guangxi, etc, which was not the case 10 years ago. This transformation is facilitated by the country's highly efficient infrastructure and logistics systems. For instance, Yangzhou was long known for plush toy manufacturing, but in the past five years, Ankang, a small city in the far northwest of China, has become the plush toy capital. Astonishingly, it now ships over 800,000 plush toys worldwide daily.

There are used to be multiple suppliers of the same product you’re looking for in the same or neighboring industrial clusters. This gives you a good leverage on product designs, quality, services and prices.

Ask me if you have questions sourcing from China.

If you need any help for China/Asia Sourcing, you may approach Victure for more information

Some useful LinkedIn groups about C/hia/Asia Sourcing-

China Sourcing- https://www.dhirubhai.net/groups/4462099/

India Sourcing- https://www.dhirubhai.net/groups/8454669/

Vietnam Sourcing- https://www.dhirubhai.net/groups/8815822/

Asia Sourcing- https://www.dhirubhai.net/groups/8909383/

Gifts and Premiums- https://www.dhirubhai.net/groups/4421652/

Circular Economy- https://www.dhirubhai.net/groups/13908783/