How to check a supplier is really a factory before you pay a deposit
Most suppliers presenting themselves as manufacturers are trading companies. Seven checks you can run yourself, in an afternoon, before any money moves.
Ask for the business licence, then read the scope of business on it. A manufacturer’s licence says manufacturing. A trading company’s says trade. That one document settles most cases in about ten minutes.
After that, the checks that work are the ones a middleman cannot answer quickly: capacity, tooling, defect rates, and a live walk through the line.
There is nothing wrong with buying through a trading company. They aggregate small orders, they handle export paperwork, they carry quality risk, and for some buyers that service is worth the margin. The problem is not their existence. The problem is paying a manufacturer’s price for a middleman’s service without knowing which one you are dealing with.
These checks cost nothing and take an afternoon. Run them before a deposit, not after.
1. Read the business licence, not just receive it
Every registered Chinese company has a business licence with a unified social credit code and, more usefully, a stated scope of business. A manufacturer’s scope names manufacturing or production of specific goods. A trading company’s scope names wholesale, import and export, or trade.
Ask for a copy. A real supplier sends it without hesitation. Then actually read the scope rather than glancing at the letterhead, and check the registered capital and the founding date while you are there. A company founded eight months ago with minimal registered capital, quoting you a full container of engineered parts, is worth more questions.
2. Ask questions only a factory can answer instantly
This is the most reliable soft check there is. Ask, in one message:
- How many production lines run this product, and what is the monthly capacity per line?
- What is your current defect rate on this item, and how is it measured?
- Which processes are done in-house and which are subcontracted?
- Who makes your tooling, and do you own the moulds?
A factory answers these from memory, because it is their own operation, and the answers are specific and slightly boring. A trading company answers slowly, vaguely, or after a delay while somebody asks the actual manufacturer. The delay is the signal.
3. Get a live video walk, unscripted
Not a video file. A live call, on the production floor, during working hours in their time zone. Ask them to walk to the line making your product, then ask for something they could not have staged: show me the machine nameplate, show me today’s production board, pan to the packing area.
Recorded footage proves a factory exists. It does not prove it is theirs. A live call where you choose the direction proves considerably more.
4. Check the address does what they say it does
Put the registered address into satellite imagery. A plant making metal parts looks like a plant: industrial roofing, loading bays, trucks, yard space. An office tower in a city centre is a trading company, and that is fine, as long as you know it. Compare the address on the business licence with the address on the quotation and with the address they give for factory visits. Three different addresses is not automatically bad, but it is a conversation.
5. Read the shipping records
This is the check almost nobody runs, and it is the strongest one.
US maritime import manifests are public. Every ocean container entering the United States generates a record naming the shipper, the consignee and a description of the goods. Several commercial services index these records and make them searchable, and there are free tiers adequate for spot checks.
Search your supplier’s name as shipper. What comes back tells you what they actually export, to whom, and in what volume. A manufacturer shows a coherent pattern: the same product family, going out steadily. A trading company shows an incoherent one: unrelated goods, sporadic volumes, many consignees.
The same records read the other way are how you find the factory behind a product you already buy, which we cover in a separate guide.
| Check | A manufacturer | A trading company |
|---|---|---|
| Business licence scope | Names manufacturing | Names wholesale or trade |
| Capacity questions | Answered immediately, specifically | Delayed or vague |
| Live line walk | Agrees, walks where you ask | Offers a recorded video |
| Product range offered | Narrow, one family | Wide and unrelated |
| Export records | Consistent product, steady volume | Mixed goods, sporadic |
| Minimum order quantity | Higher, tied to a production run | Lower, flexible |
6. Notice the breadth of what they offer
A plant is built around a process. A company that presses metal does not also injection-mould plastic, weave textiles and assemble electronics. If a catalogue spans unrelated manufacturing processes, you are looking at a sourcing agent with a good photographer, whatever the letterhead says.
7. Send someone, or pay someone, before the big order
For a first order of any size, an independent third-party inspection is cheap relative to what it protects. An inspector visits the site, confirms it exists and is operating, and reports on the production line rather than the meeting room. It typically costs a few hundred dollars. Against a five-figure deposit that is not really a cost.
The three signals that should stop you
A refusal to share the business licence. There is no legitimate reason. It is a public registration document.
Payment to a personal account, or to a company whose name does not match the licence. This is the single strongest predictor of a bad outcome, and it is also the one that leaves you with no recourse at all.
Pressure to decide before you have checked. A price that expires this week, a mould slot that will be gone by Friday. Real factories have real lead times and they do not evaporate over a weekend.
If this is a lot of work
It is. That is essentially the service we sell: we read the shipment records, identify who manufactures the goods, and come back with a delivered price from the source. But every check above is one you can run yourself, and if you are going to keep importing, they are worth knowing regardless of who you buy through.
Common questions
Ask for the business licence and read the scope of business on it: a manufacturer\u2019s licence names manufacturing, a trading company\u2019s names wholesale or trade. Then ask capacity and tooling questions, which a factory answers from memory and a middleman has to go and ask about.
No. They aggregate small orders, handle export paperwork and carry quality risk, which is worth paying for in some situations. The problem is paying a manufacturer\u2019s price for a middleman\u2019s service without knowing which you are dealing with.
To a degree. US maritime import manifests are public and name the shipper, the consignee and the goods, and several services index them. Searching your supplier as shipper shows what they actually export and how consistently.
Pay a company account whose name matches the business licence exactly, never a personal account. Beyond that, keep the deposit proportionate and consider an inspection before the balance is released.
Typically a few hundred dollars for a standard site visit and production report, which is small against a five-figure deposit on a first order.
Because they are combining your order with others, or selling from stock, rather than scheduling a production run. A low minimum on a manufactured item is often the first clue that you are not talking to the plant.
Rather have us read the records for you?
Send us a photo, a spreadsheet or an old invoice. We come back within 72 hours with one delivered price: goods, our fee, freight and an estimated duty line, in a single number. Free, and you are not committing to anything.
Get my price →