IP Protection and Why You Should or Should Not Care
A lot of entrepreneurs are torn between domestic manufacturing and overseas manufacturing. Sometimes overseas manufacturing like China is the only viable option for an entrepreneur because they need certain technologies and price points. However, the fear of Chinese companies and factories selling your product through their own channels is often paralyzing and holds the entrepreneur back, especially if they have a ‘new’ or ‘unique’ idea.
So how real are these fears? Is your manufacturing partner going to flood the market with your product? Are you going to end up cannibalizing your own business by competing with your own products, which have emerged on the market at a cheaper price? The answer is it depends.
The reason why at Rad Sourcing we call factories manufacturing partners and not just factories is because of their value and the relationship we desire with them. You should treat your factory like a co-founder or business partner. They have the power to improve your company drastically, but can also cause devastation. Would you start a business with someone you know nothing about? Of course not. Would you treat your business partner like some coffee barista who misspelled your name? Well hopefully you still treat them nicely.
Your manufacturing partner needs to be carefully vetted, preferably in person. Ideally you can find some other products they have worked on, or even speak with some other companies about their experience with them. (Like you would when hiring anybody for your team.) This seems obvious but is a step that is consistently ignored, and often made difficult due to language barriers.
Secondly, I brought up the barista example earlier because respect and care are extremely important. I would recommend, if possible, that you visit your manufacturing partner at least once or twice during production and pre-production. Face to face contact is extremely important. It conveys that you care, allows you to see your production in person, and perform your own quality control. If you are just emailing back and forth it is extremely easy for your project to be lost among the thousands of other projects, especially if you are a young and growing business.
Additionally, do not trust just any sourcing company to perform the background checks. We touched on this in other blog posts, but often times these agencies do not represent you. They instead represent the factories or solely themselves, giving you a higher price point than the factory gave you so they can make some extra money. Additionally, the sourcing agency might also sell your IP and products if they have the desire and opportunity to do so.
At Rad Sourcing we only represent our clients. Additionally we have employees in China who speak both Chinese and English fluently. They have great relationships with the manufacturing partners and will visit them frequently during your production runs to make sure everything is going smoothly.
Our final shameless plug is that due to us representing multiple companies with the same manufacturer, our factories stand to lose a lot more business if they ever illicitly reproduce any products of companies that we represent.
If you ever are curious about starting manufacturing in China or if you have been burnt before please reach out on our web form and we will see if there is anyway we can help.
We are not lawyers or a law firm and we do not provide legal, business or tax advice. None of our representatives are lawyers and they also do not provide legal, business or tax advice. The accuracy, completeness, adequacy or currency of the content is not warranted or guaranteed.