You’re about to place a project order in China.
Before any deposit leaves your account, use this China purchase order checklist to lock the non-negotiables: enforceable contracts, factory identity and capacity, QC acceptance criteria, destination-market compliance, and logistics documents.
This is written for SME procurement managers (primary) and first-time importers (secondary) who need a pre-PO gate that prevents rework, delays, and claims.
We’ll move in the order that protects you most: Contracts/IP/payment → Supplier vetting/factory audits → QC/AQL → Compliance (US first, EU second) → Incoterms/logistics/customs.
Note: This article shares practical controls, not legal advice. For binding contracts and category-specific compliance, consult PRC-qualified counsel and US/EU regulatory specialists.
Gate 1 — Contracts, IP, and Payment Terms
Lock enforceability in China and tie cash to objective acceptance. If this gate isn’t secure, everything downstream is on shaky ground.
Checklist (copy-ready variables):
- Governing law and language: “This Agreement is governed by PRC law. The Chinese version controls in case of inconsistency. Both parties affix the official company chop.” Choosing PRC law, a controlling Chinese version, and using the company chop supports enforceability in China, as widely discussed by experienced China counsel.
- Venue/arbitration: Specify a forum that’s actually enforceable in China: CIETACordesignatedPRCcourt/commissionCIETAC or designated PRC court/commissionCIETACordesignatedPRCcourt/commission.
- NNN before sharing files: Sign a Non-Disclosure, Non-Use, Non-Circumvention (NNN) agreement governed by PRC law before sending drawings/BOM/customer data. An NDA alone rarely covers non-use/non-circumvention.
- Tooling/molds: Separate tooling ownership and custody terms. “Ownership transfers on payment; no lien/pledge/retention; exclusive use for Buyer orders; mark with ID #; location: addressaddressaddress; Buyer access on 48−hour48-hour48−hour notice; return within 7–107–107–10 days on request; maintenance by Supplier; LDs amount/amount/%amount/ for breach.”
- Specifications package: Attach drawings, BOM, critical dimensions/tolerances, materials list, finishing/packaging requirements, labeling artwork, and approved golden sample ID.
- Change control: “No material change to components/process/packaging without Buyer’s written approval.” Reference the golden sample and annexed specs.
- Payment gating: “Deposit payable only after Contract/NNN/Tooling agreements signed and chopped. Mid-payment after FAI ‘PASS’ and test bookings confirmed. Balance after PSI ‘PASS’ at stated AQLs and receipt of compliance documents (US CPC/GCC or EU DoC), approved labels/artwork, and complete shipping docs.”
- Inspections and rejection rights: “Buyer may reject or require rework at Supplier cost for failure to meet AQL/annexed specs; re-inspection within XXX days.”
- Subcontracting: “No subcontracting of critical processes without Buyer’s written approval; audit rights extend to subcontractors.”
- Confidentiality and non-sell: “Supplier shall not sell Buyer-branded or Buyer-spec products to third parties; confidentiality survives XXX years.”
- Late delivery LDs: Reasonable liquidated damages with grace days and cap; tie to actual schedule risk.
Helpful references for your legal/operations teams:
- For U.S. children’s products documentation expectations, see the CPSC’s guidance on the Children’s Product Certificate (CPC) and tracking labels in the official business resources: the agency outlines CPC content and furnishing requirements in its own pages: CPSC: Children’s Product Certificate (CPC) guidance and CPSC toy safety business guidance on tracking labels.
Red flags:
- Supplier refuses PRC-law contract or won’t apply the company chop; tooling ownership left “understood” but not written; PI terms change after verbal promises.
Gate 2 — Supplier Vetting and Factory Audits
Confirm who will actually manufacture your goods, whether they can meet your spec at scale, and where subcontracting risk sits.
A robust supplier review is a core part of any China purchase order checklist and should be completed before a PI is accepted.
Checklist:
- Legal entity verification: Obtain business license (Chinese name, unified social credit code, registered address/scope). Match legal name in contract, invoices, and factory signage.
- On-site reality check: Walk the lines. Record machines (type/model/year), calibration certs for critical gauges, shift patterns, documented outputs, and preventive maintenance logs. Check that actual processes match the stated flow.
- Capacity and lead time: Validate claimed throughput with historical production logs and staffing plans. Ask for the last three months’ OEE/throughput snapshots for comparable SKUs.
- Subcontracting disclosure: Require written disclosure of any outsourced steps (e.g., plating, painting, PCB assembly). Approve or prohibit homeworking and satellite workshops; include audit rights for subcontractors.
- Materials and special processes: Identify critical materials and special processes that need certification or approved sources.
- Social/safety baseline: Spot-check headcount vs timecards; look for PPE, lockout/tagout, and basic safety training evidence. Severe safety or labor red flags often correlate with hidden outsourcing.
- Golden sample cooperation: Supplier agrees to make and seal a golden sample and store it under controlled access.
Red flags:
- They won’t name the legal manufacturer; limit audits to a showroom; capacity claims lack evidence; hidden workshops; refusal to seal and reference a golden sample; pushback on subcontracting transparency.
Gate 3 — QC Plan, Sampling, and AQL Inspections
Your acceptance criteria must be explicit before the deposit. Think of the golden sample as the “photo ID” of your spec, and AQL as the measuring stick.
Use this part of the China purchase order checklist to codify acceptance and link it to payments.
Checklist (paste into your QC annex):
- Golden sample: “Golden sample ID GS-### sealed on datedatedate; stored at locationlocationlocation; photo and dimension sheet attached to Annex XXX. Any deviation requires Buyer written approval.”
- Inspection standard: “Sampling per ISO 2859-1, General Inspection Level II.”
- AQL settings: “Critical = 0.0; Major = 1.0–1.51.0–1.51.0–1.5; Minor = 2.5–4.02.5–4.02.5–4.0. Category-specific defect list in Annex YYY with photos.”
- Inspection nodes: “FAI on datedatedate or first off-tool parts; in-process at mid−rundateormid-run date or % completionmid−rundateor; Pre-Shipment Inspection (PSI) within XXX days before shipment.”
- Rework and re-inspection: “If FAIL, Supplier reworks at cost and books re-inspection within XXX days.”
- Change control: “No substitutions of components/materials/finishes without Buyer approval.”
Practical example (neutral):
- Disclosure: Yansourcing is our product. On complex first orders, a sourcing agent can coordinate a factory audit, oversee the golden sample sealing with photos and dimension sheets, then schedule independent PSI at the agreed AQLs before the balance payment. This keeps the inspection cadence in sync with payment milestones and reduces last-minute surprises.
If you’re new to AQL, industry-standard primers explain inspection levels and Ac/Re numbers; one accessible explainer is provided by experienced QC practitioners at QualityInspection.org on inspection levels and AQL basics.
Red flags:
- Supplier says “our QA will handle it” but resists specific AQL numbers; refuses mid-production checks; disputes defect definitions after production starts; golden sample goes “missing.”
Gate 4 — Compliance, Certifications, and Labeling (US first, EU second)
Demand evidence that the product you’ll import can legally be sold where you intend to sell it. Tie delivery of compliance documents to balance payment.
This section of the China purchase order checklist prevents costly seizures and relabeling.
United States — checklist:
- Children’s products (if applicable): Ensure the importer can produce a Children’s Product Certificate (CPC) based on passing tests from a CPSC-accepted third-party lab; confirm tracking labels on product and packaging. The CPSC’s CPC page details required fields and furnishing, while its toy safety business guidance explains tracking label expectations.
- FCC equipment authorization (if electronic/radio): Decide SDoC vs Certification, ensure a U.S. responsible party for SDoC, and include required statements in manuals/labels. Primary rules are in 47 CFR, including §2.1077 compliance information content and Part 15 labeling/notice provisions (e.g., §15.19, §15.21, §15.105) listed on the eCFR Part 15 overview page.
- FDA/TSCA (category-specific): Confirm if your product involves FDA categories (food contact, medical/cosmetics) or TSCA declarations; plan testing/notifications accordingly.
- Labeling artwork: Approve importer name/address fields and any warnings before mass production.
European Union — checklist:
- CE framework: Map applicable directives/regulations (e.g., LVD/EMC/RED/Machinery) and harmonized standards; draft the EU Declaration of Conformity (DoC); build the technical documentation (risk assessment, design/manufacturing info, test reports, labeling/user instructions). The Commission’s Your Europe page summarizes technical documentation and DoC expectations.
- RoHS (if EEE): Obtain material declarations and, if needed, test evidence meeting substance limits; see the Commission’s overview of RoHS substance restrictions and scope.
- REACH Article 33 and SCIP (if SVHCs >0.1% w/w): Prepare Article 33 communications for B2B recipients; EU importers handle SCIP submissions to ECHA.
- Notified Body: If legislation requires third-party assessment (e.g., certain medical/IVD categories), confirm scope and select via the Commission’s Notified Bodies list in the SMCS portal.
- Labeling and importer address: Confirm language/local importer details; artwork sign-off required before production.
Global notes:
- Wood packaging: Ensure pallets/crates meet ISPM 15 (heat-treated/marked) or use engineered wood. The U.S. APHIS page outlines ISPM 15 requirements for wood packaging in trade.
Red flags:
- “Factory says it’s compliant” without documents; no importer name/address on labels; DoC not drafted; FCC path not decided; wood packaging unmarked.
Gate 5 — Incoterms, Logistics, and Customs Documentation
Align responsibilities, risk transfer, and paperwork. Clarify HS classification before production to avoid surprise duties or seizures.
This gate rounds out the China purchase order checklist with the shipping and customs backbone.
Incoterms 2020 — quick comparison
| Term | Who arranges main carriage | Insurance minimum | Risk transfer |
|---|---|---|---|
| FOB (Port) | Buyer | Buyer’s choice | On board at origin |
| CIF (Port) | Seller | ICC (C) minimum | On board at origin |
| CIP (Place) | Seller | ICC (A) “all risks” | At first carrier |
| DAP (Place) | Seller | Seller’s choice | At named destination (before unload) |
- For authoritative definitions, see the International Chamber of Commerce’s official Incoterms materials: ICC’s Incoterms overview.
Checklist:
- Term and place: “Incoterms 2020 FOB/CIF/CIP/DAPFOB/CIF/CIP/DAPFOB/CIF/CIP/DAP — named place port/cityport/cityport/city. Importer of record: Buyer/SellerBuyer/SellerBuyer/Seller.”
- Insurance adequacy: If Seller arranges carriage (CIF/CIP/DAP), specify coverage and beneficiary. CIF defaults to ICC(C), which is minimal; negotiate ICC(A) when appropriate.
- HS code validation: Confirm with your destination broker using HTS references and, if needed, seek a binding ruling; document reasoning.
- U.S. Section 301 (if importing to the U.S.): Check whether your HTS lines are subject to additional China duties. The USTR maintains updates to the Section 301 measures; review current notices via the USTR’s official Section 301 communications.
- Commercial invoice (U.S.): Ensure compliance with 19 CFR §141.86 contents (buyer/seller details, accurate description, quantities, prices, currency, itemized charges, assists, country of origin). The eCFR details commercial invoice content requirements.
- Packing list alignment: Make sure packing lists map perfectly to invoice and entry data to avoid CBP holds.
- Wood packaging: Use ISPM 15-compliant pallets/crates or engineered wood.
Red flags:
- Incoterms term stated without named place; relying on seller’s minimal insurance; HS code chosen from a catalog without broker validation; invoice/packing list inconsistencies.
Optional: E-commerce/DTC Add-Ons
Use these only if you ship to 3PLs/marketplaces.
- Carton/Unit labels: FNSKU/UPC/EAN placement; suffocation warnings on polybags; master carton weight/size limits; scannable outer labels.
- ASN and scheduling: Match 3PL receiving windows; pallet specs (e.g., 40×48 in North America); carton counts by ASIN/SKU.
- Returns loop: Feed 3PL returns reason codes and photos back into your defect list for the next PO annex.
How to Use This China Purchase Order Checklist
- Treat the five gates as pre-PO milestones. Do not release a deposit until Gate 1 is signed and chopped, and Gate 2 is complete. Tie Gate 3 “PASS” to the mid/balance as written. Require Gate 4 documents before balance. Lock Gate 5 terms in the PI/PO.
- Save a clean copy of this China purchase order checklist to your SOP. For each project, fill the bracketed fields and attach to the PI/PO as Annexes.
One-Page Pre-PO Gate (Copy/Paste)
- Contract & IP: PRC law; Chinese controls; supplier’s company chop; venue PRCcourt/CIETACPRC court/CIETACPRCcourt/CIETAC. NNN signed pre-files. Tooling: ownership on payment; no lien; location addressaddressaddress; access; return in 7–107–107–10 days; LDs amount/amount/%amount/. Payment: deposit after contracts signed; balance after PSI PASS + compliance docs delivered.
- Supplier Vetting: Verify legal entity vs license; on-site capacity (machines/logs/shifts); disclose/approve subcontractors; audit rights cascade; golden sample cooperation.
- QC & AQL: Golden sample ID #; ISO 2859-1 Level II; AQL — Critical 0.0; Major 1.0–1.51.0–1.51.0–1.5; Minor 2.5–4.02.5–4.02.5–4.0; FAI datedatedate; mid date/date/%date/; PSI windowwindowwindow; rework XXX days; re-inspect at supplier cost.
- Compliance: US—CPC/tracking labels (if children’s), FCC path decided; labels approved with importer address. EU—DoC drafted; technical file index; RoHS/REACH declarations; Notified Body need checked; SCIP obligation assessed. ISPM 15 for wood packaging.
- Logistics & Docs: Incoterms 2020 FOB/CIF/CIP/DAPFOB/CIF/CIP/DAPFOB/CIF/CIP/DAP named place; insurance ICCA/CICC A/CICCA/C; HS code validated with broker; U.S. 301 checked; invoice/packing list consistent.
Next steps
If you want a neutral second set of eyes on your pre-PO gate, request a short readiness review and template pack. A structured walkthrough can help surface gaps before any deposit is paid.
