Importing products directly from Chinese factories and selling them in your home country with a large margin: this can be a very profitable way of doing business. However, buying wholesale goods in China is not as easy as going to the store just down the street. Remember, you are doing business with people halfway across the world, and there are many risks involved.
Importing goods from China is a long process, easily taking months from the initial search for a supplier until you receive the goods on your doorstep. You will have to buy large quantities to make the investment worthwhile. When your container finally arrives the last thing you want is to find unsellable products!
So, how to import products from China and minimize the risks that come with by following the following steps:
Step 1: Plan
One thing that is very important when importing from China is to make a proper plan. Don’t just place an order and wait for the best; you are very likely to end up with faulty products, or with no products at all. Your product may have to comply with certain health and/or safety standards to be allowed to be sold in your home country, research this first. Secondly, write down all the requirements you have yourself, what should the size of the product be? Which materials should be used? Be very specific and make sure every single detail is thought through; this can save you many problems later on. As part of your plan also calculate your total landing costs to see whether importing from china financially makes sense.
Step 2: Find
There are thousands of Chinese suppliers, but finding the right one can take some time. There are websites where Chinese suppliers present their products, alibaba.com being the most famous one. Visit a tradeshow to meet many possible suppliers in the same place. Or hire sourcing assistance that can help on the ground with finding a suitable supplier. Unfortunately there are many cheaters actively trying to trick foreign buyers into paying for goods they will never receive. Therefore, how you end up finding your supplier does not really matter, as long as you get your supplier checked before you place an order.
Step 3: Buy
Once you found a trustworthy supplier who can supply the product you want, you can continue to negotiate the price and to sign a purchase order. Decide on which paying method you will use, and discuss the payment terms. These preferably would be 30% upfront and 70% after the container is loaded.
Step 4: Check
Now that you placed the order and made an upfront payment do not sit back and relax just yet. In China generally manufacturers work on very small margins, and there is a large share of supplier who won’t shy away from cuttings costs even if it means lowering the quality standards. Receiving good quality products is therefore your responsibility! Have an official quality control done, at least once, during the production process.
Step 5: Send
As your production is in process you can continue to arrange the logistics. When sending products internationally, either by air or by sea, there will always be a lot of paperwork involved. First of all, contact your local customs bureau to find out about the import duties and other import fees which you might have to pay. Then contact a freight forwarder, who can arrange the entire shipping and customs process for you. Shop around before you commit yourself to one freight forwarder as there is a lot of competition and price of shipping is highly flexible.