I have read in publications and other news sources about the very thing you mention about the loss of manufacturing equipment, molds, etc. when the third party in China goes under and the government seizes the factory. It doesn't look good. I have also read about the shipping costs going up as oil climbs in value. The ships carrying the items back from China run on oil. Then you have the Chinese workers demanding higher wages. There are many U.S. manufacturers finding out what you have learned. I do believe your experience will be a trend that grows in the immediate future. The reason I keep tabs on what is going on in China is because my wife is from China.

Den

I ordered $500 dollars worth of product from Chris about 16 months ago.  I have received about $35 worth so for.  He has quite responding to my emails and phone call.   BEWARE!!!!!!!   Order at your own risk.  And only if you can afford to lose the money without getting what you ordered.  He is buying lots of new tools and having big sales.  Bernie Madoff looked like he was doing great for a while.  If you take orders but don't ship the product how can you look at yourself in the mirror. 

If you do not have the item in stock, do not list it as in stock and ready to ship.  Also do not tell your customer it is in the packaging process when the items still haven't shipped a month later.  You cannot run a company this way, especially when you don't have a reputation yet.  I know its hard to run a business these days, but dishonesty is only going to cost them more customers.  Railflyer Model Prototypes has a C+ with the Better Business Bureau.  I used them for a complaint with another company and was happy with the results.  From now on, I check with the BBB before ordering anything online.