Physical or online retail businesses can source new products made in China. China has become a leading manufacturing country around the globe. Today, China offers counterfeit brands and clothes at cheap rates. There are several reliable manufacturers offering products at affordable rates without concerns about quality compromise. Unfortunately, there are some black sheep but you can avoid them. In this post, you will learn how to sieve unreliable Chinese manufacturers and even how to import goods cost-effectively.
Good reasons to source new products made in China
The Middle Kingdom has developed into the largest export country majorly because it specializes in different sought-after products. There is no other nation that has the production capability and product availability that matches China. The labor in China is less costly in comparison.
China’s strong categories include –
- Electric machinery and electronics.
- Automobile parts
- Furniture and lighting
- Bags and accessories
Shenzhen is the manufacturing epicenter in Asia because of its reliable Chinese manufacturers, service providers, and its geo-location.
How to source new products made in China?
If you sell products online or at a physical retail store there are different options to choose from for serving your customers.
- Dropshipping – In this business model, you promote products and when the customer places an order it is the 3rd party vendor that delivers directly to the buyer. You are not involved in product storage or logistics but make sure to find a reliable manufacturer or supplier.
- Reselling – You purchase products in bulk and then resell them to customers. Here you will be responsible for the entire logistic process including warehouse and delivery.
- White labeling – The manufacturer produces a generic product in serial and you rebrand it. The product appears as your company created it.
- Have a unique product customized – Having a unique product created offers more control and flexibility. However, it is a time-consuming process with lots of pros and cons.
How to source existing products made in China?
For a dropshipping business model look for s supplier that offers this service. You can find them on popular platforms like DHgate, AliExpress, and TomTop. It is an easy solution that allows starting product sourcing from China quickly.
White labeling and reselling model needs you to look for desired products on a platform like Made in China, Global Sources, and Alibaba. You can attend exhibitions and trade shows in China. After finding the desired product and vendor get in touch. Directly negotiate with the manufacturer. You can run a test order [small] first. It helps to determine if the vendor is reliable and legitimate.
How to have your product customized?
Having a customized product gives better money value and it gives your business a competitive edge. Even if having a product customized is a time-consuming and complex procedure, it will pay off. Here are some steps for creating & sourcing products.
1. Product development
Before you start a business, it is essential to know your goal, product type, volume, and budget. Create a plan and write the specification of the product in detail –
- Quality of product & raw materials
- Quantity [request 2 to 3dfferent quantities to compare the quotes]
- The budget must include the fulfillment cost
- Lead time includes transportation
- Product videos & photos
- Certification checks of your country where the product will be sold like FDA in the United States and CE in Europe.
Remember, when you partner with a Chinese supplier, the terms of payment are 100% prepayment. Ensure to have a copyright for your customized product because it may be needed in distribution countries.
2. Find reliable manufacturers
It is challenging to find a reliable Chinese manufacturer especially if you don’t know the Mandarin language. For verification, you can get factory licenses, recommendations, and photos or videos. However, there are many other things to consider like open communications to build a good business relationship.
The language barrier can be a great issue because this can also lead to misunderstanding. It is better to hire a reliable sourcing agent in China that will work in your interest. They have a great supplier network and even are great negotiators. They are also familiar with the legalities associated with every nation and their logistic needs.
It is normal to negotiate the price, quantity, and quality. Some manufacturers need high MOQ [minimum order quantity]. If the quantity is higher the price gets better. While negotiating directly be reasonable and humble. Never expect to get a quality product at the cheapest rate.
4. Production process
After finding a manufacturer, start the sampling process. Never skip this because it is inexpensive and you get a product designed perfectly. You may have to change the samples until satisfactory results are obtained. If you order in bulk then imagine the cost of modification, if needed. The cost of the sample will be deducted from the bulk order and if you are not placing the bulk order then pay for the cost of the sample.
During the production process, after sample approval request for regular photos and updates to avert downtime due to lack of communication. The factory manager will inspect the products for accuracy and quality.
5. Logistic & payment
After the production is completed, it is time for shipment. Some of the common forwarding services are –
- Delivered Duty Paid [DDP] – The seller arranges the transportation to the final destination and pays for it [even customs]. It is a very costly option and you get less control.
- Ex Works [EXW] – The buyer organizes the transportation from the factory site to the final destination. You have total control of the logistic process.
A freight forwarder is a middleman between carriers and shippers. Air transportation is fast but expensive, while shipping is cheap but slow. You can consider working with 3rd party logistic provider, who will take care of the entire fulfillment process.
Customs is a complex process that includes the declaration, process period, and cost. Your products can get stuck in customs for a long if there was an error in the good’s labeling. There is a need to accurately and completely declare the import & export country, goods type, quantity, and value. You will even need to mention the shipping and insurance cost.
Payment and transaction charges are also complicated, so request your bank about the payments to be transferred to China. If the manufacturer has subsidiaries in Taiwan or Hong Kong, payment transfer from the US or Europe is easy.
Before you partner with a supplier, it is essential to do thorough research, especially if you will not travel to check the sourcing agent or the potential manufacturer. Sourcing new products made in China is a great business idea, but learn how to identify a reliable local sourcing agent and manufacturer!