Having a Chinese supplier can be both a blessing and a curse. Blessing, because China is one of the most popular product manufacturing and importing hubs – if not the best – in the world. Chinese suppliers also offer a wide variety of products that would suit your business niche.
On the other hand, China has already received a lot of negative press apparently due to its “fake” products. It can also possibly affect your relationship with your customers once they learned that you source your products from China.
In real life, not all Chinese suppliers sell counterfeit and low-quality products –there are still decent ones that offer world-class products. In fact, several global brands like Nike and Prada have their own manufacturing plants in China. That goes to say that not everything you hear about the country in terms of product quality.
Selling via Amazon
If you are one of those who are planning or has already started a small business online – say, Amazon – one of the important things you would consider is a reliable supplier. Amazon is one of the largest e-commerce sites in the world, with millions of products being offered for millions of online customers.
Working your business via Amazon is one thing. Sourcing and importing your products from China is another thing. It requires a lot of documents and other action steps to make the entire importation process successful. No worries – this article should guide you on the process of importing from the other side of the world and making your online business successful as well.
Tips on importing China-made products and selling via Amazon
1. Ask yourself these questions.
In starting a business, you would also have to consider the following:
• What kind of products should I sell?
• How can I find a reliable and trustworthy supplier from China?
• How will I know if I only get high-quality products from the supplier?
• How can I deal with a supplier in terms of importation requirements?
• How can I prevent getting involved in scams?
Mostly you would know what kind of products to sell depending on your line of interest such as sports, health and fitness, or baby care. If you don’t have a specific hobby or interest to inspire you, you can choose any products that you think can easily sell. It may be fashion apparel and accessories, watches, and many others.
You can find a reliable supplier via online (ex. Alibaba, Global Sources), visiting trade shows in your area or internationally, or checking potential suppliers online and scheduling company visits. More than talking to a supplier, you should be able to meet your supplier at least once as well as having a product sample on hand. Make sure the supplier is a reputable one and that has no brushes with the law.
2. Decide whether you’ll get your products nearby or import.
On one hand, having a local supplier ensures faster delivery lead time, hence keeping your product stock in check all the time. On the downside, local suppliers may offer limited choices and may even vary in quality. Also, some products do not allow putting your own branding to their products. While you may not likely encounter customs problems, having a local supplier can cost you more unlike importing in China.
On the other hand, Chinese suppliers offer lower costs and lower minimum order. You can also choose from a wide variety of products. Unlike local suppliers, China-sourced products will give you the opportunity to create your own branding – which can make your products memorable for customers. On the downside, you may have to deal with longer delivery lead times and encounter shipment issues.
3. Understand rules, regulations, and policies in importation.
Before anything else, make sure to understand your local government and Amazon’s rules and regulations about importation. There are some products that are actually prohibited to be imported from China, such as food and health supplements. You may risk violating the laws and put you in trouble.
4. Avoid buying in bulk the first time.
Before selling a China-imported product, make sure you obtain a sample for further inspection. Some owners get some samples and sell it for validation purposes. Once they get feedback from a customer, that’s the time they will start increasing their orders. Also, don’t fall into the trap of some suppliers who say they cannot ship small orders – they actually can, but they just want you to buy larger amounts instead.
5. Never buy “fake” products.
This is an absolute no-no! Selling counterfeit products to your customers will not only lose you money (for possible copyright lawsuits), but also ruin your business’ reputation. The suppliers win, while your business loses.
6. Avoid restocking your inventory too much.
There are some “off-peak” periods where sales may be more relaxed in a way. And then there are those “in demand” times where your products may sell like pancakes. This is why it is important to have a realistic forecast to determine when you are going to order your stock next. This will also help you with allocating budget on your stocking period and avoid wasting money from non-moving items in your warehouse.
7. Hire a product sourcing/procurement agent.
If you are a first-timer, you can hire an agent to help you out with the importation process. He or she will be mainly responsible in dealing with your supplier – from obtaining samples, placing an order, to shipment. Having a reliable agent can be a huge sigh of relief for your business.
8. Agree on a payment scheme.
There are different ways to pay your suppliers, and choose one that is most applicable to you.
• Open account – you only pay for the imported goods once you have already received them.
• Wire transfer – normally used among small- to medium-sized transactions and done prior to product delivery. It can be risky, but make sure to deal only with trustworthy suppliers.
• Cash advance – considered the riskiest as it requires cash payment prior to delivery.
• Letter of credit – similar to bank loan, the importer will send a letter stating how much credit is available and then the importer’s bank will pay the supplier as per stated in the letter’s conditions. The importer will then pay the bank to settle the credit.
• Online escrow – preferred by many online importers, similar to letter of credit but for smaller transactions
9. Learn about shipping terms.
If you are into product importation, it is important to have knowledge on “Incoterms” or the International Commercial Terms. Also you should know about efficient labeling and packaging as a way to save you lots of money. Calculations are involved here, so you can determine the right container you can place your products for shipment.
There are also different delivery methods – express delivery, via air, and via sea. Each of these delivery methods vary on required cargo weight and delivery lead time, so choose one that suits your delivery requirements. Certain documentations for customs will also be needed, so make sure to know more about this process.
10. Don’t forget your after-sales support.
Be a good seller to your online customers. Make sure to sell quality products to them, and that would only be possible when you have a trustworthy supplier. When there are online concerns, make sure to answer them as promptly as possible. You should also keep in touch with your supplier regarding product issues that may open up.
Opening a business via Amazon can be tempting, but it requires hard work to learn the craft. The above tips should serve as a guide for product importation in China and selling via Amazon.