Here is the worst thing you can do when working with a factory.

Having an “us versus them” mentality.

Trying to squeeze them for everything they have.

Only considering your brand’s needs and pain points.

If you’re reading this and thinking to yourself “Right, of course” then congrats—you’re probably approaching it the right way.

The Wrong Approach

But there are a lot of brands I’ve come across whose factory relationships look like this:

➤ They only talk to their factory when putting in a PO or when complaining about a problem

➤ They have never spoken with them, let alone met them in person

➤ They expect unrealistic quality and turnarounds without giving fair compensation

Am I saying “don’t rock the boat?”

No, definitely not.

The Right Approach

You need to negotiate for what’s fair for your best interests.

But as brands, our factories are one of our biggest—if not our biggest— business partner.

We need to enter into a mutually beneficial relationship with them.

That sounds cliched, I know.

But it’s like any other healthy relationship—it takes a lot of work to bring it from a 4/10 to a 10/10.

Some Tips on Negotiating With Your Factory

So, talk to your factory more often.

Mention your pain points and listen actively to theirs.

If they say “no” or hesitate during negotiations then probe further with questions.

➤ “What is preventing you from finishing the product in 30 days?”

➤ “What are your challenges to get the price to $7.50/unit?”

➤  “Why is the mold cost so high?”

Even better, know your Bill of Materials and understand the manufacturing process.

You’ll be better equipped to negotiate, understanding their perspective and position.

What’s the Ultimate Move in Negotiating? 

Best yet—try to visit them in person in China.

Especially if you’ve been working with them a number of years.

Even in our connected world, nothing still beats meeting in person.

Seeing their operation, viewing the showroom, chatting over dinner, going to karaoke…

The Benefits of Working on Your Factory Relationship

Having a strong factory relationship is extremely rewarding.You can expect:

➤ Better pricing, terms and lead times

➤ Early access to new products and innovations

➤ Opportunities to share cost or collaborate

➤ Improved communication and faster resolution of issues

Building and maintaining a good factory relationship is both personally rewarding and also a strong long term business play.

So, let’s get out there and make some killer products and have fun doing it—alongside our happy factory partners.

How about you? What are some strategies you’ve used to build a strong relationship with factories? Have you made any mistakes along the way?

*Bill of Materials (BOM) is the itemized list of components, parts, materials, and assemblies for your product.