China Manufacturing and the Bike Lock Theory on Subcontractors

Our China lawyers have of late been receiving more than the usual number of emails and phone calls from companies (mostly American and European) wanting to pursue litigation against their Chinese manufacturers for bad product. In these “bad product” cases — especially if it is with a formerly “good” manufacturer — the product problem frequently stems from a sloppy subcontractor used by the Chinese manufacturer with whom the Western company has been working. The Chinese manufacturer freely reveals it used a subcontractor and blames the bad quality on the subcontractor. In most instances, the Western company did not even know that anyone other than its Chinese manufacturer was working on its product. Truth is most internationally savvy China manufacturers are incredibly busy these days and loath to turn down good work they subcontract like crazy. Sometimes the subcontracting is for one portion of a product, oftentimes a portion they themselves…

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