It is not a coincidence that local markets around the globe are replete with products imported from China. When you are out shopping and come across items that you want to buy, there’s a strong likelihood that they have a “Made in China” tag on them. These items would not only be of high quality but also affordable. From toys to footwear, bags to clothes, vehicles to mobile phones, sports equipment to spare parts, Products from China are reaching marketplaces in every part of the world, and that’s why importing from China becomes a priority for most big and small businesses around the globe.
There’s no doubt that you can score big when importing raw material or finished products from China. The market is a practical representation of “boom boom, shake the room.” However, it’s easy to slip in pursuit of your big business dream if you are a novice. The Chinese market is strong and unique in terms of how it functions. The language, the culture, and the importing process tend to overwhelm novice importers. To avoid drastic profit cuts, as an importer, you need to be aware of unexpected delays, fluctuating delivery charges, trade policies, rise and fall in demand, and all other factors that can affect importing from China.
The team of experts at Minden International, a company that provides ground-breaking solutions to simplify importing from China, has prepared an effective 8-step guide to importing from China. In this guide, you’ll learn the basics of how to make the process of buying from Chinese exporters trouble-free and efficient. So, let’s begin!
1. Identify Your Import Rights
If you are buying products from a foreign country or source, you are an importer. The process is called importation, and every country has its own set of regulations and principles for it. China also had specific legal rulings surrounding imports. As someone looking forward to importing from China, you need to be well-aware of your import rights.
Have you ever purchased an item for personal use from online marketplaces like AliExpress? The products are sent via reliable courier services like DHL, FedEx, or UPS. These companies are responsible for handling and delivering your package, saving you from all the hassle. However, we are talking about larger orders here. We are dealing with commercial purchases that you are making for your business or as an individual for resale. Importing from China for commercial purposes requires paperwork.
You need to get government documentation, depending on what and how much you are purchasing. You will need to apply for a product-specific license as well as register with the Chinese Customs Authority, Chinese Inspection and Quarantine Bureau, the e-port, and your local state administration of foreign exchange.
But, you are a businessman, not a legal expert, so the process of acquiring the legal documentation may seem complex and tiresome to you. In such cases, it’s best to contact a reliable company, like Minden International. We’ll help you smooth things out for you.
2. Identify the Products You Want To Import
Identifying “what” helps you uncovers the “how.” From the myriad of product options, you need to choose the RIGHT product that you will be importing from China. Thinking like a good businessman, you would wish to import a product which can get you huge profits when sold. You will also be keeping an eye on optimized competition and products that can be easily improved or resold under your brand. A mistake in buying the right products would cost you much more than just money.
As per the website World’s Top Exports, China’s Top 10 Exports include electrical machinery or electronics, computers, furniture, plastic articles, vehicles, apparel, organic chemicals, and metallic products. The market is surely quite diverse and has a lot to offer, so use all your sources to collect substantial information about the products you would like to sell.
Also, try to assess which product is needed in your country and which product would sell due to its uniqueness. Start by getting some sample products and go through the literature that comes with them. You can use the HS code to determine the duty charges placed on your imported goods.
If you choose a product that is easy to ship and can be sold with a high-profit margin, you’ll hit the jackpot! Have a look at the best-selling products or read our detailed piece on 20 most popular and potential e-commerce products in 2020.
3. Ensure the Products Are Allowed Into Your Country
Every country has its trade norms, and this includes products whose trading is banned. Before importing from China, you should ensure that the products are allowed in your country, and you have secured the permits required for trading. Do your research regarding the laws and trade policies of the government of your country. Keep safety guidelines, health codes requirements, and restrictions into consideration. Losing money as penalties or getting the products detained can be a blow to your business aspirations; hence, it’s best to be prepared.
4. Calculate the Total Landed Cost before Purchasing
The total landed cost is the overall cost of getting a product, including every penny that you’ll be paying when acquiring the product. You can calculate the total landed cost by adding three major prices. Go through the Incoterms and use the formula:
Landed Cost = EXW/FOB + To-Door Freight + Customs Fees
EXW/FOB is paid to the seller in China, To-Door Freight is paid to the freight forwarder, and Customs Fees is paid at the port to the customs. You can estimate this cost by getting the price of the product from the seller, checking the shipping charges offered by the freight forwarding company, confirming the customs clearance charges, and finally, the cost of transportation to your warehouse.
5. Find a Supplier in China and Place an Order
The booming market of China offers you great choices when finding suppliers. Once you have followed all the aforementioned steps, finding the right supplier becomes a lot easier.
When finding a supplier in China, beware of looking for the supplier with the cheapest products. A good importer would never get lured into a ‘low rate trap.’ Coming across a supplier who quotes significantly low prices shouldn’t make you feel lucky. Instead, you should ask “why” the prices are so low. Know this that while some prices may be lower than others, getting the ‘lowest’ rates means comprising in terms of quality, quantity, or reputation.
Language is another barrier that you need to overcome. Make sure that you have made your requirements crystal clear to your supplier, and they have understood it completely. Failing to do so will result in a disaster. After all, you don’t want a warehouse full of unwanted products. Go one step ahead and discuss the specifications in detail as well. Check and recheck the agreed-upon product and packaging.
6. Get the Products Inspected After Production
Product quality is directly proportional to the success of your business, and a low-quality product might give you temporary profit, but your business won’t flourish in the long run. As an importer, always go for products with the best quality. Once you get the products shipped, there’s no way you could make much of a difference. Hence, quality control starts right after production. The sourcing process is incomplete without QC.
While the supplier would surely have QC services at his factory, you can’t rely completely on their standards. So, how can you carry out the quality inspection? There are two ways to do this: traveling to China and check the quality yourself or hire help in the form of a private inspector or a third-party inspection company.
7. Arrange the Shipping
Finally, you have chosen and paid for your products, and they are ready to be shipped. Shipping involves a number of different factors as well. You will be paying for container fees, broker fees, packaging, and terminal handling.
Shipping is a risky process and should be handled accordingly. Delays are a part of the process and should be considered. Make a list of everything that can go wrong with the process and then make counter-measures for them. Think about what you will do if the production doesn’t complete on time or things don’t go as scheduled, what if the products are stuck in customs or not shipped on time.
It would be very impractical to think that the minute the production completes, the products will be shipped. It would take a couple of days to transport the cargo to the get transported to the port. Customs would take a couple of days more. Add more days if the production completes at the end of the week. Choosing the right service partner would facilitate logistics and help save shipping costs. A poorly managed logistics would lead to considerable losses for your business.
Prepare in advance and get a quote with us. With the details you’ll provide to us, we’ll accelerate the shipping process, and you’ll get your products transported to you safely and smoothly.
8. Track the Shipment and Get Your Products
The shipment leaves China, and the count-down starts. When importing from China, keep in mind that it takes about two weeks on average for the shipment to reach the West Coast of the United States. If your warehouse is on the East Coast, the time will increase and become up to 4 to 5 weeks.
Fortunately, you have the option to track the shipment whether it’s a sea shipment, air freight or courier express. When the products are on their way, keep everything ready, including your commercial invoice, bills, and additional freight documents. Doing so will make it all fast and trouble-free. As an importer, be ready for last-minute mishaps as well. In case of any issue with the customs clearance, keep your plan B ready. Arrange your customs broker for clearance upon arrival of the cargo.
If all steps are followed perfectly, you will get your products easily. In case you opted for a to-door service, the shipment will be directly sent to the destination you specified.
This 8-step process requires experience and attention to detail, and that’s what we have. At Minden International, you begin sourcing for free. We provide import/export consultation and help you make the right decisions. You can also join our list of satisfied customers and let us handle the entire process of importing from China for you.