Stages of the Product Sourcing Process

Product Sourcing is a complex process – that’s a big reason many of our clients prefer to leave it to experts like us.  But even if you outsource it, you need to have an understanding of the main stages.  We hope this page gives a good outline of what Hornet can do for you.

Stage 1: Pre-Sourcing

This is probably the stage you’re at right now.  You want some product and you want to know if we can help you get it effectively.
What Hornet do
We can tell you about sourcing in general and from China in particular.  We can tell you about Hornet: our operations and processes; our experience in your industry.  We may provide references.  We’ll also want to know more about your project – what you want, volumes, levels of customisation, leadtimes, specific features or standards – so we can provide some high level advice as to whether we can help.
It’s important to note that we cannot provide a full quotation on your project at this stage.  Every sourcing project we do is different, with its own unique needs in terms of product, quality, quantity, special requirements, likelihood of repeat / larger orders and so on.  This means every product requires its own unique investigation to find the best fit factory.
What next?
Once you’re comfortable with us, it’s time to move on to the actual sourcing and get a formal quotation for your project.  We need two things from you:
  • sign the Services Agreement
  • pay the Product Sourcing Fee ($600)
If you’re unhappy about the Product Sourcing Fee, take a look at the next Stage and all the things we’re going to do in return for that fee.  They’re worth far more than $600.  We simply can’t undertake that kind of work without some form of commitment from you.  And remember, if you don’t like the quotation, you can still walk away with no further obligation.  Is $600 really too much to pay to have custom personalised research on the most effective way to provide the product you know you want?
Note also that the Product Sourcing Fee is a one-time-only charge.  Whether you proceed with this project or not, we won’t charge it on your next project.

Stage 2: Sourcing

What Hornet do
This is where the bulk of our work is done and where our expertise and our extensive networks come into play.  Our professional sourcing service includes:
  • clarifying product specification
  • identifying potentially suitable factories based on product type, quality and quantity required, pricing, ability to meet deadlines etc
  • selecting preferred factory shortlist
  • factory registration checks and preliminary audit
  • non disclosure agreement implementation if necessary
  • physical inspection of factories where appropriate
  • negotiating with factories
  • selection of the best fit factory for your combination of needs
  • further negotiation
What you get from Hornet
You get your project-specific quotation. This includes the cost of the product (usually either EXW or FOB terms) plus the cost of providing samples.  If you want an understanding of freight costs, we can also include this, but it is important to remember that freight rates vary week to week, so any prices are indicative only and are subject to change.
What next?
So you liked the price.  The next stage is to get a sample and confirm that you are happy with the product.  We need two things from you:
  • complete the Product Sample Request Form
  • pay the Product Sample and Sample shipment costs

Stage 3: Sampling

What Hornet do
Once we have your Product Sample Request Form, we order samples from the factory, inspect them in China and inspect them again on arrival in Australia.  We do our best to make sure you get exactly what you wanted – or even something better.
What you get from Hornet
When we’re happy with the sample, we submit it to you.
Occasionally clients are unhappy with a sample.  This may be due to changes in requirement, inadequate specification etc.  Additional samples may be ordered.  Hornet reserves the right to on-charge the cost of producing and shipping additional samples where client activity has caused the need for resampling.
What next?
When you’re happy with the sample, it’s time to get the goods made.  We need you to:
  • complete the Product Order Form
  • complete the Product Quality Control Pre-Shipment Checklist
  • pay the Production Commencement Deposit (usually 30% of order value, dependent on factory requirements)
At Hornet’s discretion, the Production Commencement Deposit may be replaced by a purchase order with pre-arranged and agreed terms of payment.

Stage 4: Order and Production

What Hornet do

  • We put manufacturing contracts in place with the factory.
  • Once these are confirmed, we transfer payment to the factory.
  • We manage the manufacturing process proactively on your behalf.

What you get from Hornet
We provide updates on manufacturing progress and expected completion dates.
If we are organising freight from you, we supply an estimate of when you will receive your consignment via the Product Manufacturing and Import Schedule.

Stage 5: Pre-Shipment Inspection

What Hornet do
If there are any problems with your goods, it’s far better to find them before the goods leave China, so all projects include a pre-shipment Inspection.  This is where the Product Quality Control Pre-Shipment Checklist you completed earlier is used.
What you get from Hornet
Our staff in China check your product against all the requirements on the form and then send the checklist to you for review.
If by any chance there are problems, we liaise with you to agree steps for rectification, then conduct repeated inspections until you are happy with the results and ready to sign off.
What next?
Your order is ready to ship as soon as you:
  • sign the Product Quality Control Pre-Shipment Checklist
  • pay the Production Completion Fee (normally 70% of total order cost, dependent on factory requirements)

Stage 6: Shipping

What Hornet do
If you’ve asked us to organise shipping, we’ll instruct the factory to ship the order and liaise with the freight forwarder to get your good shipped.  And of course we’ll let you know where and when they’ll be landing in Australia.
If you’re doing your own shipping, we’ll instruct the factory to ship the order and advise you of the date it’s ready for shipment.


Stage 7: Project Closure

Congratulations!  You have your product and your project is complete.  But we want to be sure you had a good experience, or to learn how we could make it better next time.  So you’ll get either a Service Review Questionnaire or a call from your account manager.