How to verify your Chinese Partners, Suppliers or Buyers?

How to verify your Chinese Partners, Suppliers or Buyers?
Apr 18, 2010 11:06
CHINACREDIT Points: Join Date: Apr 18, 2010 Status: offline	Most of the Chinese Businessmen are good and trustworthy, but some frauds or liars do exist. A lot of foreigner businessmen are always confused by the business registration and credit status of Chinese Companies, and find it really difficult verifying information of them. 1. Checking the contact information In order to avoid being traced by law enforcement authorities, most scammers will not offer genuine registration information online. They will provide a false company address, telephone number and fax number or persuade buyers to contact them by mobile phone only. 2. Checking their business license and credit status Legal companies in China have to register with the Chinese government authorities and obtain a unique company registration number. If your business partner cannot offer you a unique company registration number, it is risky to deal with them. To check the registration number your supplier provided, you need to visit their local administrative government website with the number they provided. You can also use a third-party authentication service company in China to help you verify information, such as OrientCredit, SMR, Inter-credit, or some other credit reporting companies in China. (Sorry, I forget the names of the rest companies) 3. Incredibly low prices or high commission rate Most Chinese scammers will lure buyers with very low prices. If the prices they offer are too good to be true, you should investigate why their prices are so low. Most scammers in China make a profit by selling replicas or fakes of branded goods to overseas buyers. This is very risky because the goods will be confiscated or detained by Chinese customs if they are considered illegal in China. 4. Payment and shipment terms The scammers never accept L/C as a term of payment. They prefer Western Union, and T/T etc. They also never deliver goods through formal channels; preferring instead to deliver samples Express by Fedex, TNT, EMS to avoid examinations from Chinese customs. Scammers never accept Letter of Credit (LC) payments but there are some small factories they don't have their professional foreign trading stuff, so they do not dare to accept LC as they could be refused by negotiating bank, and because they are small mill do not have enough running fund so they would like to receive T/T 30% or 50% in adance. For sample orders and smaller shipments, consider using an escrow service, Western union. 5. Visit their company or factory in person Everybody agrees that the best and ultimate way is to visit these companies; you can't know a company how it is unless you visit it. But I think this is some kind of second stage of negotiation. Because you may receive a lot of offers by many different Chinese suppliers, and it’s impossible for you to go to their factories one by one and therefore you should select some before visit their office or plant in person.

Apr 18, 2010 11:06

CHINACREDIT
Points:
Join Date: Apr 18, 2010
Status: offline

Most of the Chinese Businessmen are good and trustworthy, but some frauds or liars do exist. A lot of foreigner businessmen are always confused by the business registration and credit status of Chinese Companies, and find it really difficult verifying information of them.

1. Checking the contact information
In order to avoid being traced by law enforcement authorities, most scammers will not offer genuine registration information online. They will provide a false company address, telephone number and fax number or persuade buyers to contact them by mobile phone only.

2. Checking their business license and credit status
Legal companies in China have to register with the Chinese government authorities and obtain a unique company registration number. If your business partner cannot offer you a unique company registration number, it is risky to deal with them. To check the registration number your supplier provided, you need to visit their local administrative government website with the number they provided.

You can also use a third-party authentication service company in China to help you verify information, such as OrientCredit, SMR, Inter-credit, or some other credit reporting companies in China. (Sorry, I forget the names of the rest companies)

3. Incredibly low prices or high commission rate
Most Chinese scammers will lure buyers with very low prices. If the prices they offer are too good to be true, you should investigate why their prices are so low. Most scammers in China make a profit by selling replicas or fakes of branded goods to overseas buyers. This is very risky because the goods will be confiscated or detained by Chinese customs if they are considered illegal in China.

4. Payment and shipment terms
The scammers never accept L/C as a term of payment. They prefer Western Union, and T/T etc. They also never deliver goods through formal channels; preferring instead to deliver samples Express by Fedex, TNT, EMS to avoid examinations from Chinese customs. Scammers never accept Letter of Credit (LC) payments but there are some small factories they don't have their professional foreign trading stuff, so they do not dare to accept LC as they could be refused by negotiating bank, and because they are small mill do not have enough running fund so they would like to receive T/T 30% or 50% in adance. For sample orders and smaller shipments, consider using an escrow service, Western union.

5. Visit their company or factory in person
Everybody agrees that the best and ultimate way is to visit these companies; you can't know a company how it is unless you visit it. But I think this is some kind of second stage of negotiation. Because you may receive a lot of offers by many different Chinese suppliers, and it’s impossible for you to go to their factories one by one and therefore you should select some before visit their office or plant in person.

Apr 7, 2011 20:44

STINIRENE
Points:
Join Date: Jan 20, 2011
Status: Offline

I agree Chinacredit said. and scam can be avoided, If your order is big enough, pay a visit to the factory yourself or ask a third party to fully check the company in person, though that cost much, that would protect your interest better. If in a small order,do a basic verification on the company, means check the company's register info such as business license, export license etc with the local offical (the industrial and commercial bureau) for confirmation, that also assure you if the company is legitimate.
You can aslo mail to me for more info: yahoo.com|stin002

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