Hi everyone,
My business, ALC Global Partners, LLC emerged out of the very problem you mention. We are a sourcing consultancy that help clients buy products in China. You are very right that doing business with people you don't know in China can be very risky. That is why my company only sources from factories that we have visited ourselves and are geographically near enough to oversee production. In addition, the payment standard you mention (50 upfront, 50 after work is completed) is actually not the standard. Usually you are asked to pay 30/ 70 (30 down and 70 when the work is complete). You must be very careful in contract negociations and you are right that bargaining is the norm.
If anyone has more questions I would be happy to respond. (I lived and worked in China for over 2 years and speak, read and write fluent Mandarin.)
Good luck, but always be careful!!!
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Andrea Snavely
ALC Global Partners LLC, sourcing consultancy
Regional Manager - East Asia
www.alcglobalpartners.com