After finding potential suppliers, you need to verify them through a clear 7-step process and then choose the most suitable one by comparing prices, sample quality, and other key factors.

If you want to build a successful business around physical products, two steps are absolutely essential: first, selecting the right product; second, partnering with a reliable supplier. These decisions lay the foundation for a long-term, mutually beneficial relationship.

As the ancient Chinese strategist Sun Tzu once said: “Know yourself and know your opponent, and you will never be defeated in a hundred battles.” You don’t need to be deeply familiar with Chinese culture to understand this wisdom—just follow along, and you’ll gain a practical framework for checking a supplier’s background and choosing the best partner.

Understanding the Supplier’s Business Model

One of the most critical aspects to evaluate is the supplier’s business model. Are you dealing directly with a manufacturer, or is the company a trading intermediary? Perhaps they are wholesalers?

What you must develop is the skill to recognize the true nature of your supplier and fully understand who you are doing business with. In China, suppliers typically fall into three main categories: manufacturers, trading companies, and wholesalers.

Thinking about starting your own business?
Do you know the key things to focus on before taking the leap—and how to source products at the best price without compromising on quality?

Download my FREE Ultimate Catalog to Starting Your Own Business and get the answers you need to kickstart your journey.

Manufacturers

Manufacturers are the factories that actually produce goods. Some of them actively seek international buyers by setting up booths at trade fairs (like the Canton Fair), operating stalls in local markets, or opening accounts on platforms such as Alibaba. This makes it easier for businesses like yours to find and connect with them.

Others, however, focus purely on production. They don’t usually deal directly with overseas customers and instead sell to Chinese traders or wholesalers. Since they often lack English-speaking sales staff, it can be challenging to approach these factories directly.

Trading Companies

Trading companies—often grouped together with wholesalers under the term “traders”—can sometimes be difficult to distinguish. They typically specialize in a certain product category and have established reliable relationships with manufacturers.

Like factories, their minimum order quantities (MOQ) often start around $1,000. While their prices may be slightly higher, partnering with a trustworthy trading company can be a smart long-term choice, especially if you value stability and consistent supply.

Wholesalers

Wholesalers are everywhere: on Alibaba, at trade shows, and in wholesale markets across China. Unlike manufacturers or trading companies, they don’t specialize in a single product type. Instead, they sell a wide range of items to capture profits from trending or fast-moving products.

Their MOQs are usually much lower—sometimes under $200 or even $100—making them ideal if you want to test products in small batches. Wholesalers are quick to spot new trends, which makes them great for sourcing hot products.

A genuine manufacturer specializing in phone cases should mainly offer phone-related products—typically made from materials like silicone or plastic. If the same supplier also lists unrelated items, such as laptop bags, it’s a clear signal that they may not actually produce the phone cases themselves, or that their real focus is broader phone accessories. In such cases, they’re likely sourcing those extra products from others and operating more like a trader.

By contrast, if you come across a trader focused on phone accessories, their catalog will usually include a range of related items—such as chargers, screen protectors, and headphones—since these align with their niche.

Wholesalers, on the other hand, often carry a mixed assortment of products that don’t really belong together, like electronics, clothing, and household goods. This wide variety is a strong indicator of their business model and shows they’re not directly involved in manufacturing.

Check the Supplier’s Location in China

The third factor to examine when evaluating a supplier is their location. This matters especially when sourcing online or at trade fairs, as a supplier’s location can directly influence their pricing and competitiveness.

If the supplier is based in an industrial cluster—a region that specializes in manufacturing a particular type of product—their prices are usually more competitive compared to those from other areas.

If you’re not familiar with what industrial clusters are or how to identify them, you can refer to our previous post for a detailed explanation.

Another point to note is company registration. Many Chinese suppliers are registered both in mainland China and Hong Kong. This is not necessarily a red flag. In fact, it’s a common practice, mainly because of China’s strict foreign currency regulations. By registering offshore entities in Hong Kong, companies can more easily handle international transactions through Hong Kong bank accounts.

Check the Supplier’s Business History

The fourth aspect to review is the supplier’s track record. If you want a reliable long-term partner, look for one that has been operating for at least three years.

Why three years? In China, starting a business is inexpensive and straightforward—often costing less than $500. As a result, many new suppliers appear overnight and present themselves as experienced professionals on platforms like Alibaba. However, if a supplier has managed to stay in business for three or more years, it’s usually a good sign of stability and reliability.

To verify their history, you can:

• Ask the supplier directly

• Review their business license

• Check when they joined platforms like Alibaba，linkedin

Verify Domain and Online Presence

In addition, you can use tools such as whois.com to check the registration date of a supplier’s website or email domain. A long-established domain often suggests greater stability.
Exploring the supplier’s official website or social media pages can also provide valuable clues. Look for photos or posts showing participation in trade fairs, as well as consistency in the types of products they promote over time. These details can help you assess their credibility.

Check the Exported Countries

The fifth factor to consider is the supplier’s export markets. For example, if you come across a supplier offering unusually low prices but notice that most of their customers are in developing countries, that could be a red flag. If your goal is to sell on major platforms like Amazon in the US, the quality of those products may not meet expectations, which could lead to complaints and returns.

Chinese suppliers typically have specific countries or regions where they concentrate their exports. Understanding these target markets gives you insight into whether the supplier’s products are likely to meet the standards and quality requirements of your own market.

Check Compliance Certifications

The sixth aspect to review is whether the supplier holds the necessary compliance certifications for your product. This is particularly critical for categories like electronics, toys, or medical devices, as each country has its own regulations that must be met to pass customs clearance and be sold online.

For example, if you plan to import electronic products into the United States, ensure the supplier has FCC certification. This indicates compliance with US regulations. On the other hand, a supplier that only holds a CE mark for Europe would not be sufficient for the US market.

In such cases, you would need to bear additional testing costs to ensure compliance with U.S. regulations. For this reason, if your goal is to import into the U.S. market, it is far more efficient to work with suppliers who already hold FCC certification. This not only streamlines the importation process but also helps you avoid unnecessary expenses and delays.

Check the Manufacturer’s Qualifications

Beyond product certifications, the seventh factor to consider is the manufacturer’s qualifications.

For most small to medium-sized businesses, this step may not be critical. Such qualifications are generally more relevant for large-scale buyers. Smaller factories or trading companies often do not possess them, and their necessity varies by industry.

One of the most common certifications is ISO 9001, which demonstrates that a supplier follows a standardized quality management system. While it is not essential for every business, ISO 9001 certification signals that the supplier is a genuine manufacturer with efficient processes in place.

Another widely recognized qualification is SA8000, which focuses on social responsibility. It evaluates factors such as fair wages, safe working environments, and ethical labor practices.

Although many small and medium-sized businesses may not need to filter suppliers strictly based on these qualifications, they can serve as an added advantage. A supplier with these certifications often projects a stronger professional image and indicates prior experience working with larger, established retailers.

7-Step Supplier Verification Guide

Finding suppliers is only the first step. To choose the right partner and avoid costly mistakes, you need a systematic way to verify them. Here’s a step-by-step guide:

1. Understand the Supplier’s Business Model

Suppliers in China generally fall into three categories:

• Manufacturers – direct producers, best for customization and large orders.

• Trading Companies – intermediaries with stable factory networks, slightly higher prices but reliable service.

• Wholesalers – low MOQ, great for testing trends, but limited expertise and higher per-unit cost.

👉 Identifying which type you’re dealing with helps you predict pricing, flexibility, and long-term potential.

2. Review Their Product Range

A true manufacturer usually focuses on a narrow product line (e.g., phone cases made of silicone/plastic). If a supplier offers unrelated items (like mixing phone cases with laptop bags or clothing), they may be acting more like a trader or wholesaler.

👉 A focused catalog often signals stronger expertise and in-house production.

3. Check Their Location in China

Location can be a big indicator of competitiveness. Suppliers based in industrial clusters (regions specializing in specific products) tend to offer better prices and efficiency.

Also note: many companies register both in mainland China and Hong Kong—a common practice to simplify international payments, not necessarily a scam.

4. Examine Their Business History

Reliability grows with time. Choose suppliers that have been operating for at least three years.

To verify, you can:

• Ask for their business license

• Check their Alibaba profile

• Use whois.com to see when their website/email domain was registered

• Browse their website or social media for consistency and trade fair participation

👉 Surviving 3+ years in China’s competitive market is usually a good sign of stability.

5. Check Their Export Markets

Where do they ship most of their products?

• If their buyers are mostly from developing countries, their quality may not meet US/EU standards.

• If they already export to your target market (e.g., the US, Europe, or Amazon sellers), that’s a strong sign their products comply with local requirements.

👉 Export destinations reveal whether a supplier understands and can meet your market’s expectations.

6. Verify Compliance Certifications

For regulated products (electronics, toys, medical devices), certifications are essential.

• For the US: look for FCC, FDA, etc.

• For the EU: look for CE, RoHS, etc.

👉 Without proper certifications, your goods may get stuck at customs or be banned from platforms like Amazon.

7. Test Prices and Samples

Finally, compare prices, but don’t let the cheapest offer fool you. Request samples to evaluate quality firsthand. Consider:

• Product durability and finish

• Packaging and labeling

• Delivery times and service responsiveness

👉 A trustworthy supplier balances competitive pricing with consistent quality.

Choosing the right supplier is not about speed—it’s about building a long-term partnership. By following these seven steps, you’ll have a clear framework to identify reliable suppliers, reduce risks, and grow your business with confidence.