Mastering the Chinese Supply Chain with Kanary Solutions’ Greg Lepkoff

While the rest of the world starts to gain ground with local manufacturing, China still remains as one of, if not, the biggest manufacturer worldwide—especially when it comes to ecommerce, as a whole. 

From the smallest players to the biggest figures in the industry, there’s no doubt that the Asian manufacturing powerhouse has a hand in the creation of billions of items that land on consumer doorsteps each year. And while China has come a long way from struggling with the “Made in China” stereotype, there’s one aspect of its manufacturing presence that still remains complex:

The Chinese Supply Chain.

For any DTC or ecommerce brand looking to get ahead and build more resilient paths to success, partnering with the right manufacturer in China is a pivotal opportunity that can influence short and long-term trajectories. With lower costs, quicker turnaround times, feasible product development, and more adaptability to high-volume orders, working with manufacturers in the country is a straighter shot to profit. 

Factory worker

The difficulty for brands looking to capitalize, however, not only lies in language barriers—it also comes in the form of operational nuances and manufacturer behaviors.

But, according to Kanary Solutions leader Greg Lepkoff, navigating the Chinese supply chain isn’t as daunting as most people think, once you have the right foundation to work with.

After taking up a Chinese studies program, Greg set out to apply his university education to real life by working with manufacturers all over the country—going on to learn more about how they create, operate, and interact. And, with decades of experience, he now stands as one of the main reference points for brands looking to navigate China’s expansive supply chain. 

Recently, we had the pleasure of sitting down with Greg to learn more about what it takes to capitalize on the Chinese supply chain and how Kanary Solutions—together with EcommOps—provides the opportunity to do so. This episode is a key resource for any DTC or ecommerce brand looking to grow and scale while bolstering their operations with better solutions.

Here are some of our favorite key takeaways from our Chinese supply chain deep dive with Kanary Solutions’ Greg Lepkoff:

Key Takeaways

1. Establishing a personal relationship with manufacturers in China is crucial for flexibility in negotiations and preferential treatment.

 Although sourcing supply from the country already comes at a lower cost and more flexibility, building a stronger connection with a supplier can drastically improve your experience when you dive into the Chinese supply chain—as Greg says:

Factories really like it when you’re detail oriented but flexible at the same time. They love to be face to face with you, and I think when you are building a strong personal relationship with them, you’re going to be able to get into those flexible pricing discussions or lead time discussions, but more importantly, with a personal relationship with them.”

By meeting with [factories] face to face, they’re going to start to give you preferential treatment, or they might even just give you better terms.

Personal Relationships

With a little effort goes a long way—so make sure to build a great relationship with the manufacturers you work with in China from the get-go.

2. Due diligence is a foundational step in the sourcing process to ensure direct contact with the manufacturer and not just trade companies.

Unfortunately, this is a crucial step that most DTC and ecommerce brands looking into the Chinese supply chain overlook—which often results in brand-manufacturer miscommunication, missed shipments, and quality control issues.

Here’s what Greg shared with us about due diligence:

I think the due diligence is key because this is the beginning phase of our relationship building with the manufacturers as well. When we deal with consumer products, we’re in Shenzhen, so everybody’s in our backyard. So it’s kind of quite easy to just do five visits in a day with a manufacturer, meet the owners, eat with them, and kind of just know what their capabilities are, understand the brands that they’re working with, because sometimes it’s important to have an idea of it so that you could see where you would fall on the totem pole.”

By practicing due diligence, you’ll have a far easier time ensuring that your brand partners with the right manufacturer who will have your best interests in mind while simplifying the complexities of Chinese supply chains.

3. Quality control must be proactive, and manufacturers must be engaged to ensure optimal product manufacturing.

When it comes to working with Chinese manufacturers, in particular, the practice of flexibility influences the experiences that you have with them as you work towards building a system that capitalizes on China’s supply chain—as Greg says:

So I’d say the quality control part, just having a good checklist and having a good process with the manufacturer and making them work in the system that works best for you on top of their own QC systems is like the perfect recipe for success with them.”

Establishing a proactive relationship with your manufacturer ensures that your DTC brand will be better-equipped to reap the benefits of the Chinese supply chain from end to end and deliver the best experiences for your customers. 

Trouble solving

4. Alongside having a stronger relationship, being flexible with manufacturers in the Chinese supply chain and constantly collaborating with them can help set any DTC brand for further success.

Greg mentions that this approach is especially important for today’s manufacturer landscape because of the individual behaviors of each firm and its accompanying systems:

When it comes to dealing with troubleshooting issues, are you going to come up with solutions with [the factory] to work through it? Sometimes problems are not black and white. So being flexible, having a good relationship, being direct, is, I think, the most important part.

Through the use of a flexible approach, you can collaborate with your chosen manufacturer better in tougher situations and bigger challenges that come along when you start scaling your operations.

5. Choosing products with high customer retention rates that can help create a loyal customer base are essential strategies for DTC brands to stay competitive against major marketplaces.

In our conversation with Greg, he says that choosing these types of offerings can help leverage how the Chinese supply chain works to a greater extent:

So I think what’s really important, and what I’m seeing with a lot of DTC brands is they’re starting to look at products that have high customer retention rates so that they can build this loyal customer base where they can now start to sell these accessories that you would see on Temu as like an upsell or cross-sell.

Leveraging an approach that focuses on selling products with high customer retention rate can help you fast-track your way to more sales and a higher-performing relationship with your chosen manufacturer in the Chinese supply chain.

Final Words

Supply chain Sourcing secrets

Wrapping up this exploration into the complexities and opportunities within the Chinese supply chain, it’s clear that success hinges on more than just navigating logistics. 

Establishing strong, personal relationships with manufacturers, undertaking thorough due diligence, maintaining proactive quality control, and choosing products wisely are foundational steps any DTC or ecommerce brand must consider. 

Greg Lepkoff’s insights, coupled with practical examples, offer a blueprint for brands looking to leverage the vast potential of China’s manufacturing capabilities. By emphasizing collaboration, flexibility, and strategic product selection, businesses can not only survive but thrive in the competitive landscape of ecommerce, transforming challenges into stepping stones for growth and innovation.

If you loved the insights from this episode on navigating the Chinese supply chain, you can access more of The EcommOps Podcast’s insightful episodes on our website. Follow us on LinkedIn for the latest updates. 

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