Detailed explanation of industry investigation of processing projects with supplied materials

Detailed explanation of industry investigation of processing projects with supplied materials

If there is an industry in which many investors are deceived, but their enthusiasm remains undiminished, then this industry must have huge profit space.

Trap, scam! When it comes to processing with supplied materials, many investors are very angry.

The Internet is full of angry words from deceived investors, and the media such as the Internet and TV are constantly exposing the traps of processing with supplied materials. At the same time, all kinds of advertisements for processing materials are still full of media.

On the other hand, a statistical data of Yiwu Industrial and Commercial Department shocked the reporter. At present, nearly 500,000 farmers in China rely on Yiwu market to engage in processing business, and receive processing fees of nearly 2 billion yuan from Yiwu every year.

What kind of industry is processing with imported materials, what great wealth has been created, and what big traps have been laid? The reporter made a special trip to Yiwu, Zhejiang, Dongguan, Guangdong and other places where the processing of raw materials in China is relatively concentrated. Uncover the inside story of the industry.

A campaign to promote the industry

"Can you crochet?" "Will the price be higher? Otherwise, it is very difficult for us to accept this order. "In Yiwu International Trade City, we can see the scene of processing brokers and business owners in nearby counties seeking suitable processing business from each other every day.

Processing with supplied materials was originally a foreign trade term. However, with the rise of a new wave of individual entrepreneurship, processing with supplied materials is not limited to the field of foreign trade, but has gradually developed into a trade model that covers all raw materials provided by purchasers, entrusts processors to process finished products or accessories, and then recycles them for sale.

In the interview, the reporter found that in recent years, the industries involved in processing materials cover almost all fields closely related to people's lives. Many industries sell products in the market, and the whole production process belongs to processing with supplied materials.

With the expansion of the processing industry from the traditional foreign trade field to the ordinary domestic production field, more and more industries are involved, and the practitioners of belt processing are also changing. The most outstanding performance is that the processors who undertake the processing business of incoming materials are gradually changing to individual and private enterprises. A number of processing enterprises with small scale, low investment, simple operation and loose management are constantly emerging, and even some individual craftsmen and family workshops have begun to join the gold diggers of incoming materials processing, which has set off the popularization movement of the processing industry.

Processing with supplied materials is a labor-intensive industry, and this transformation of the industry provides new opportunities for many entrepreneurs who have entrepreneurial ideals but lack financial resources. On the other hand, with the increasing demand for products, the processing industry has become obviously polarized. Due to the lack of funds, personnel and technology, small processing enterprises can only receive sporadic orders with low processing costs, while a large number of high-end orders are increasingly concentrated in large processing enterprises. So for many small processing enterprises, how to gain a firm foothold in the market and seek development?

Survival law of small enterprises

In the early autumn of 2006, when the reporter saw Qu Zhigang on the street in Dongguan, Guangdong, he was busy with an order of nearly one million yuan. Small processing enterprises have been facing many difficulties and tests. It is difficult to recruit workers, and the treatment requirements are gradually improved. In order to reduce costs, customers artificially reduce processing costs, speed up technological upgrading, and competitors seem to be getting stronger and stronger.

However, it is in this grim situation that Qu Zhigang's mechanical processing plant has gradually developed from the initial workshop-style operation mode into an enterprise processing unit with hundreds of employees.

Qu Zhigang's success embodies the typical development model of small processing enterprises. At the beginning of his business, he took price as the main competitive weapon, carried out mutually beneficial cooperation with his peers, put the processing procedures with the highest technical content in his own factory, and transferred the other general procedures to other small factories for processing. Through this cooperation, he completely got rid of the predicament, embarked on a large-scale development route, and had several big orders.

However, the reporter also learned in the interview that with the increasingly fierce market competition, more and more small processing enterprises have to choose the "edge ball" operation mode in the face of great survival pressure.

Mr. Han, the owner of a processing factory that produces accessories for a brand of water heaters, told reporters that the most common practice in the industry at present is to reach a certain tacit understanding with the quality inspection, technology and procurement personnel of the factory, reduce the quality of raw materials and parts, or falsely report the loss of raw materials and obtain the difference.

In addition to earning the price difference from raw materials, some enterprises steal technologies, models and formulas from each other during processing, or brand their own brands, or produce and sell at relatively low prices in the name of "foreign trade tail list" and "A goods".

In the interview, the reporter also found that most of the fake and shoddy products on the market now come from these small processing enterprises and underground factories. Cooperation with buyers who produce fake and shoddy products has become an important source of profit for many small processing enterprises.

In fact, it is not only large and small processing enterprises that take a fancy to the huge profit space and operation space of processing with imported materials, but also some buyers with ulterior motives are also seeking illegal benefits for themselves in the form of processing with imported materials, digging a black trap for countless entrepreneurs who dream of getting rich through processing.

How many traps are there in the name of processing?

From silk flower, silk flower, Chinese knots, diamond ornaments and ceramic resistors a few years ago to various electronic components, high-tech products and handicrafts now, although the designs set in the name of processing with imported materials are constantly being refurbished, the essence is to refuse to recycle products for various reasons and refuse to refund the fees paid by the processors for materials, deposits and other various names. How did such a simple and similar scam make many entrepreneurs fall into the trap?

In the interview, the reporter learned that the most common means for companies to set up processing and counterfeiting is to refuse to recycle the products assembled by the processors in the name that the quality, time and quantity can not meet the requirements, so as to embezzle the related expenses such as the deposit paid by the processors. In this process, if a processor has doubts about the project, the company will also advise it to try small batch processing first. After the processors finish processing the first batch of products, the company will generally take them back with pleasure, so as to dispel the doubts of the processors about the company, and then lobby them to sign bulk processing contracts with the company. In addition to the quality standards that can never be met, some companies also require processors to buy their equipment, which is often expensive. Some companies send materials to processors, either the quantity is insufficient or the quality is not good, so it is impossible to complete the processing task with good quality and quantity.

It should be noted that with the increasing vigilance of investors, the means of some fraudsters are more subtle. For example, for some large-scale processing projects, the company will take the initiative to propose that in order to safeguard the interests of both parties, it is necessary to invite lawyers to witness the contract, and both parties will bear half of the witness fee. In fact, the lawyer the company found colluded in advance to defraud the witness fee of the handler. There are also some companies that recycle products, but the down payment and processing fee will not be paid until the processors sign a batch of contracts. In order to get back the deposit and processing fee, the processors have to continue to cooperate, and a sum of money will always be held in the hands of the company.

In the face of all kinds of deception, how should ordinary entrepreneurs avoid encountering traps when they are engaged in processing materials, and how to obtain legitimate profits in this industry?

Open the door to profit

Although there are some traps in the processing industry, it is not difficult to distinguish the authenticity of processing projects as long as entrepreneurs carefully identify them.

When faced with an attractive processing project, it is best to investigate the market price of the processed products. If it is a formal processing project, there should be a big gap between the processing fee and the price of a single product. After investors decide to engage in a processing project, they should make a detailed inspection of the manufacturers. We should not only directly inspect the company itself, but also see whether it has a fixed office space, relevant business license, registration time, whether the patent is true, whether the machinery and technology are advanced, and whether the raw materials meet the requirements. , but also from the side to inspect the operation of the company's franchisees.

The reporter also found in the interview that the company's technical training is often easily overlooked by franchisees. In fact, fraudsters often deliberately omit some seemingly simple steps in the training process, which sometimes determine the processing efficiency and product quality.

If there are no problems in the above links, finally, franchisees need to carefully study the processing contracts provided by the company, especially the terms on product quality, and avoid using vague words without clear and objective standards, such as "unity", "smoothness", "flexibility" and "consistency". Because these are all excuses for manufacturers to reject products.

Although there are many gray means and scams in the processing industry, its huge market and the characteristics of labor-intensive industries determine that it still provides a convenient and feasible way for many entrepreneurs who lack funds and channels. As an individual entrepreneur or small-scale processing enterprise, how to survive and develop in the fierce market competition, and summarize the experiences of some successful small-scale processing enterprises mainly include the following points:

First of all, processing brokers have a lot of market information, which can be a shortcut to expand their business. Secondly, pay attention to the combination of processing projects with new products and market hotspots to effectively avoid fierce market competition. Third, through cooperation with peers, we can meet customers' needs for serialization and chain processing and improve our own production capacity and market competitiveness. Fourth, highlight your own advantages in a certain product and process to form your own personalized market competitiveness. Fifth, solemn brand management. Relying on good service, we will build up corporate reputation and reputation among customers and brokers.

When the reporter finished the interview and left Yiwu, a new upsurge was brewing in the busy Yiwu International Trade City. The annual Yiwu Commodity Expo is coming soon, and many processing brokers active in this small commodity capital of China, as well as the huge processing army behind them, will usher in a new entrepreneurial peak.