Is your Vietnam supplier a factory or a trading company? 9 ways to check
Online, a trading company can look exactly like a factory. The photos are polished, the website says "manufacturer," and the salesperson is friendly. But if you are buying from a middleman, their margin is built into your price, and when something goes wrong there is nobody at the source you can talk to.
That is not always bad. Some trading companies are honest, useful and worth what they charge. The problem is not knowing which one you are dealing with. Here are nine checks you can run before you pay a deposit. No single check proves anything on its own, so use several together.
1. Ask them directly
Ask three plain questions. Are you the manufacturer? Do you own the factory? Is your price the factory's price, or does it include a markup? A real factory answers easily. Vague, defensive or slow answers are a signal.
2. Look up the company's registration
Every company in Vietnam is registered, and its list of business lines is public on the National Business Registration Portal (dangkykinhdoanh.gov.vn). Business lines carry industry codes. A manufacturer is expected to be registered for manufacturing, which sits in Section C of the classification. A pure trader is registered under wholesale or trade codes, which sit in Section G, and wholesale is Division 46.
Ask a Vietnamese speaker to help with the lookup. Keep in mind that a factory can also hold trading codes, so having no manufacturing codes is a red flag, but having them is not proof.
3. Look at the product range
Factories make what their machines make. If one supplier offers furniture, phone cases and garden tools from the same catalogue, it is probably buying from several factories.
4. Ask technical questions
Ask how the product is made: which machines, which materials, what tolerances, how long each step takes. A factory can talk about this in detail. If the answer to every question is "I will check with the factory," you are talking to a middleman. Ask to speak to someone in production or engineering. If every conversation has to pass through a salesperson, take note.
5. Ask for a live video call from the production floor
Not the showroom, not the office, and not a recorded video. Ask them to show the machines making something similar to your product. A simple trick is to ask them to hold a sheet of paper with your name and today's date next to the machine. Also run a reverse image search on their factory photos to catch pictures copied from other websites.
6. Check the address
Does the factory address match the registered address? Look it up on a map. Factories are usually in industrial zones. A small city-centre office that claims to be a factory needs an explanation.
7. Ask for certificates and check the name on them
If they hold ISO 9001 or industry certificates, the company name and address on the certificate must match the company you are dealing with, and the dates must be valid. Where you can, confirm with the issuer. A certificate in a different company's name is a red flag.
8. Look at their shipping history
Trade data services can show which company actually exports the goods. If the exporter on the shipping records is not your supplier, that is a clue that someone else makes or ships the product.
9. Visit, or hire an independent inspector
For a large order, check before you pay a deposit. A visit or a third-party audit confirms the equipment, the workers and the process. If a supplier refuses an audit, or keeps postponing a visit without a good reason, treat that as a strong warning.
What if it turns out to be a trading company?
You do not have to walk away. Ask what they add: quality checks, consolidating several products, smaller orders, credit terms. Then find out how large their margin is by getting a quote from other manufacturers for the same specification. Compare the landed cost, not just the price on the quote.
The size of the gap matters. On a $100,000 order, every 10% extra is $10,000.
Already have a quote from a supplier in Vietnam?
Send it to us and we will compare it with what other Vietnamese manufacturers charge for the same specification. We never contact your current supplier without your permission.
Send us your quoteScope and any fees are agreed with you before paid work begins.
Further reading
- SourceReady: Factory vs. trading company, 10 ways to tell the difference
- Dewin: How to tell if a Vietnam custom steel parts supplier is a factory or a trading company
This guide is general information, not legal advice. Always verify a supplier's details before you pay a deposit.