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PassageMaker China

Remotely Managed Virtual Workshops & Offices

Dedicated Staff, Quality Focused Manufacturing, Professional Management & Access to a Team of Experts

Download our free and informative whitepaper “An insider’s look at options for manufacturing in China“

Learn more about how the manufacturing landscape in China is changing, and how your brand can adapt to it.

You will learn:

  • What the best options are when manufacturing in China
  • What it takes to setup manufacturing in China
  • Various options for outsourcing and the benefits of each

PassageMaker’s China News

Business & Law Blogs

PassageMaker’s Founder Interviewed by the Financial Times

PassageMaker’s founder (Mike Bellamy) was interviewed by…

Read more →

China Sourcing at Trade Shows – Top Q&A, Tutorials and Resources

Are you looking to start your China Sourcing at Trade Shows? With…

Read more →

China Compensation Benchmark: A Survey of Salary, Taxes & Benefits

Last time we took a look at some of the best practices for hiring…

Read more →

Service Overview

PassageMaker leverages its China-based infrastructure:

  • China savvy management
  • Standard Operating Procedures (SOP) & protocols
  • Business templates
  • Quality systems (ISO compliant)
  • Space (warehouse, assembly center & office)
  •  Full licensing (import-export rights and the ability to process VAT rebates for our clients)

to recruit, employ, train & manage dedicated teams in China on behalf of our clients.

4 Point Cost Structure

  • MANPOWER

    Manpower comes in two forms:

    Support Staff (SS) refers to the client’s team members who are based in PassageMaker’s office.  These virtual assistants and administrators are responsible for managing the client’s supply chains. The full list of tasks commonly assigned to the SS is found here.

    Factory Staff (FS) are based in PassageMaker’s warehouse and provide the labor to manufacture, assemble, inspect and/or package the client’s product. Visit here to learn about PassageMaker’s facility in Shenzhen, China.

    Salaries and mandatory benefits for SS & FS are invoiced at cost.

  • RENTS & UTILITIES

    Space in the warehouse, assembly center, dorm and office is invoiced at costs in a transparent fashion.

  • DIRECT EXPENSES

    The Bill of Material (BOM), Logistics & Project Expenses (tooling, sampling, FedEx…) are billed to the client under open book accounting.

  • PASSAGEMAKER’S SERVICE FEE

    PassageMaker’s fees come in two forms:  Infrastructure Fee and Project Management Fee.

    Infrastructure Fee

    2000 RMB per dedicated team member per month with a minimum monthly charge of 13,800 RMB.

    Project Management Fee

    “Managed by Client”  (MbC)  Option

    Client directly manages the day-to-day activities of the team (SS &FS).

    A project management fee is not charged.

    “Managed by PassageMaker” (MbP) Option

    Client assigns PassageMaker to supervise the day-to-day activities of the team (SS & FS).

    The small commission is applied to the value of the goods & services coordinated by the team under PassageMaker’s management. Minimum monthly charge of 15,275 RMB.

Basic Info

Minimum Project Scope/ Minimum Monthly Service Fee (Please read before requesting a proposal.)

  • The SS or FS team can be as small as 1 person for new projects. Some of our larger projects have over 100’s of dedicated staffers.
  • In the past 12 months, on behalf of clients, PassageMaker was responsible for orchestrating multiple supply chains with a combined value of over 200 million USD.
  • While the typical client purchases between 2 and 20 million USD worth of goods or services in China per annum, we welcome startups and small projects if they are:
    • stable (minimum project term of 6 months),
    • show potential for growth and
    • can support our minimum monthly fee of 13,800 RMB per active month. This minimum fee allows PassageMaker to assign experienced staff and superior resources to each and every project.
  • Not everybody needs full time staff in China or has an on-going project (6 or more months).  If PassageMaker is not a perfect fit for your needs, please check out our sister company at China Sourcing Service Center (CSSC) as they specialize in short term/ limited scope projects.

Client’s Role

  • Sets the project tasks, objectives & timeline.
  • Selects the number of Support Staff (SS) and/or Factory Staff (SS) they wish to assign to the project.
  • Finances the project (BOM, Logistics & Payroll).
  • Provides reliable order forecasts, to the best of their ability.

Project Team when “Managed by PassageMaker”

Title

Overview

Location/Allocation

Financed by:

Support Staff (SS)

Recruited on behalf of Client for a specific skill set (sourcing, supply chain management, quality systems, engineering, sales, marketing, logistics or any other skills the client’s project requires).

They advance the client’s agenda on a day-to-day basis among the various entities engaged on behalf of the client.

Based in PassageMaker’s office

Assigned to project full-time

Client

Factory Staff (FS)

Recruited on behalf of Client for a specific skill set

The FS are local production line workers, inspectors and/or warehouse staff.

Based in PassageMaker’s Factory

Assigned to project full-time

Client

Account Manager (AM)

Responsible for overall project performance and serves as the client’s primary point of contact in China.  Coordinates the Factory Manager (FM), In-house Specialists (IHS) and Outside Specialists (OS) on an as-needed basis.  The AM is an administrator with strong communication and project management skills based in our office.

Based in PassageMaker’s office

While the AM  generally spends no more than a few hours per week on the project, it is important to have a central administrator for a clear chain of command and smooth communications among team members on China and Client sides.

PassageMaker

Factory Manager (FM)

Recruits, trains and manages the day-to-day activities of the FS.  Reports to the AM.  Coordinates the production area set up.  Implements the bilingual Product Quality Manual based on the specifications & work instructions provide by client. Responsible for creating & reviewing the KPI (key performance indicators) of factory-based team members on a monthly basis. Responsible for managing lead times & quality standards.  For complex projects, Shop Foreman (SF) and Quality Supervisor (QS) may need to be hired to support the FM.  SF and QS are specialized Support Staff (SS) who fall under the Level 3 Support Staff salary targets in most cases.

Based in PassageMaker’s Factory

While the FM  generally spends no more than a few hours per week on a given project, it is important to have a central manager based at the production line for a clear chain of command.

PassageMaker

Support Staff Supervisor (3S)

Recruits, trains and manages the day-to-day activities of the SS.

Responsible for reviewing the KPI (key performance indicators) of each SS on a monthly basis.

Based in PassageMaker’s Office

PassageMaker

In-House Specialists (IHS)

Members of PassageMaker’s advisory board, logistics team, human resources team, quality systems team, engineering group & accounting team, can be tapped by the AM and SSS to provide advice and expertise but not actual manpower.

Based in PassageMaker’s Office

PassageMaker

Human Resources: Compensation Packages & Mandatory Benefits

The salary of the Support Staff (SS) & Factory Staff (FS) is highly dependent on the work experience, language skills, level of education and job scope as desired by the Client.

 

Support Staff (SS) (Office Manpower)

Factory Staff (FS)

Classification

SS Level 1

SS Level 2

SS Level 3

SS Level 4

SS Level 5

FS Level 1

Description

Local Chinese with college degree, less than 2 year’s work experience, no special language or technical skills required

Local Chinese with college degree, less than 2 year’s work experience, basic English but no technical skills required

Local Chinese with college degree, 2-5 year’s work experience, no special language or technical skills required

Local Chinese with college degree, 2-5 years relevant work experience, English and/or technical skills required

Local Chinese with college degree, at least 5 years relevant work experience, technical skill or language required

Typical factory worker basic experience. Advanced education not required. Minimum wage.

Typical base salary RMB per Month

3000.00

4000.00

4850.00

5200.00

6200.00

2020.00

Monthly Salary adjusted for Month 13 year end bonus per standard practice in China

3250.00

4333.33

5254.17

5633.33

6716.67

2199.00

Office Staff Insentives: >KPI bonus (at the discression of client). PassageMaker suggests 10% of payroll be allocated to KPI fund. Dispursed on a monthly basis.

300.00

400.00

485.00

520.00

620.00

0.00

Factory Staff Insentives: KPI bonus (piece rate bonus) and/or OT. PassageMaker suggests 15% of payroll be allocated for this line item.

0.00

0.00

0.00

0.00

0.00

303.00

Dorm (800 RMB per room per month/ 4 people)

0.00

0.00

0.00

0.00

0.00

200.00

Meal Allowance & Mandatory Benefits (Tax, Housing fund, Insurance…)

1050.00

1400.00

1697.50

1820.00

2170.00

600.00

RMB

4600.00

6133.33

7436.67

7973.33

9506.67

3202.00

Terms and conditions of SS & FS employment will comply with relevant PRC labor laws and standard practices found in China, with regards to all aspects of employment, including but not limited to issues of severance, termination, maternity leave, mandatory benefits & working conditions.

Human Resources: Hours of Operation/OT Regulations: Factory

Factory

Typical Hours

Notes

Normal Hours of Operation

7:50am – 11:50

1:30pm-5:30

Monday to Friday

Per PM policy

Normal OT Session (if needed)

OT Session: 6pm-9pm Monday to Friday.

Per PM policy

Number of 8 hour shift per day

1

Running a night shift is possible. Additional fees would apply.

OT Rate: 6pm-9pm

150%

Per labor law

OT Rate: Weekend

200%

Per labor law

OT Rate: Holiday

300%

Per labor law

Total working hours per day (pre-OT)

7.66

Per labor law, 8 hour work day equates to 7hr40min “on the production line” + 2 standard 10 min breaks + lunch break

Workdays in Average Month adjusted for government holidays. Exclusive of sick days & paid/ unpaid leave as allocated by PRC labor law.

21.7

Human Resources: Hours of Operation/OT Regulations: Office

Office

Typical Hours

Notes

Normal Hours of Operation

9am to 12:30, 2- 5:30

Monday to Friday

 

OT

0

Office staff are generally not asked to perform OT. OT rates, if needed, would be 1.5X for afterhours, 2X weekends and 3X holidays.

Hours per normal work day

8

 

Office: Workdays in Average Month adjusted for government holidays. Exclusive of sick days & paid/ unpaid leave as allocated by PRC labor law.

21.7

Rent & Utility Reference Figures

Rent & utilities are minimal for most projects. For your quick reference, here are the latest rates for factory, warehouse and office space.

Space Reference Figures

Office Setting

RMB

 

Work space inside common area of PassageMaker’s Office

500

RMB per month per workstation per person. Inclusive of reasonable access to wifi, printer, meeting rooms, rest rooms, and recreation rooms (Coffee, bar billards, foosball).

Factory Setting

RMB

 

Rent for Dedicated space inside PassageMaker’s factory

40

RMB per SQM per Month. Fixed Rate.

Warehouse Fee in PassageMaker’s Common use area.

20

RMB per CBM. Applied at 3 phrases: in/out/per week.

This standard method of calculation allows for scalable sqm or cbm-based billing and can take into account multiple components that change size during the assembly process.

Take for example the case of a group of shoes being placed into their shoe boxes. Before assembly, 1cbm shoes + 1 cbm boxes = 2 cbm of billable space. However, once the shoes go into the boxes, then only 1 cmb is billable space. Our system is designed to prevent double billing and keep a fair record of actual space used at any given time.

Temporary Support Staff (TSS), Quality Systems Engineering (QSE), VAT Rebate Processing & China Sales Facilitation can be provided.

Man Power Reference Figures for Temporary Staff (if needed)

Description

RMB Rate

Units

Allocation

Temporary Support Staff (TSS) As Needed. Subject to availability. Temporary manpower provided by PassageMaker. Based in PassageMaker Office.

4500

1Man – Week

Available Allocations: Full time for X weeks, 1/2 Time for X weeks, 1/4 Time for X weeks.

Quality Systems Engineering (QSE) As Needed. Temporary manpower coordinated by PassageMaker. Base in PassageMaker office and factory to complete the client’s Product Quality Manual. (PQM)

425

1Man – Hour

Most PQMs Require less than 10 hours to complete

VAT Rebate Processing

Fixed Fee of 1.26% based on the FOB value of goods exported. Manpower, Infrastructure & Licensing provided by PassageMaker. For example, if the value of the order was 600,000 USD and the VAT rebate rate was 17%, and PassageMaker was appointed by the client to arrange the export & VAT rebate, then 102,000 USD rebate would be received by PassageMaker from PRC government. 7,560 USD would remain with PassageMaker as service fee and the remainder (94,440 USD) would be returned to the client via PassageMaker.

Domestic Sales Facilitation

A “Domestic Sales Facilitation” Fee of 3% is applied to the sales price in cases where Client appoints PassageMaker to invoice, collect RMB payments and/ or provide official receipts to Client’s China-based customers. Manpower, Infrastructure & Licensing provided by PassageMaker.

FAQ

This short video answers the following FAQ:

  • What service does PassageMaker provide?
  • What are the options for setting up an office or factory in China?
  • What’s special about PassageMaker’s infrastructure?
  • How much does it costs to hire white collar workers to find and manage suppliers or even sell my goods in China?
  • What if I need a blue collar team to physically manufacture, assemble, inspect or package my product?
  • What’s does it cost to engage PassageMaker and how would this cooperation work?
  • How to get started?
  • Is there a minimum project size or MOQ?

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