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Old 12-07-2008, 01:09 AM   #16 (permalink)
cbeebies
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Default Buying from China

Finding the right supplier in China is a key ingredient of successful buying from China.

Whether you meet your supplier from the trade show, find its contact from magazine, or searched its information from B2B platform, working with different suppliers makes the difference between success and failure.

Fraud, quality problem, false certification, un-punctual delivery, communication barrier, intellect piracy … Chinese suppliers are known by many bad reputations, but China still holds the “World Factory” name of USD969 billion export in 2007, increased 28% than the year before. Actually, buying from China is challenging. You may get big profit from importing and selling goods from China, or you may lose all your money. But unless you learn to manage and control the risk, it can keep you from trading successfully.

As a Chinese woman who has been working in international trade and sourcing field for 11 years, I’m going to share with you some tips from my perspective:

1. Know the product. Become familiar with the product you’re going to buy from China. The material, specification, packing, testing method, H.S. No. and relevant import compliance regulations beforehand. You are the expert of your buying product, not someone else. Never go for the brand name products. Most people get scammed because of trying to buy brand name products from China to make quick bucks, but end of receiving fakes or nothing.

2. Know the manufacturing place. If possible, get some knowledge of the Chinese manufacturing place. Some places are known for something. Like Yiwu, the largest small commodities market in China, even in the world; Shenzhen, City of Electronic Products in China; Yongkang, City of Hardwares in China; Anpin, World Wire Mesh County; Cengzhou, World Tie City; Xiamen, City of Marble/Granite/Stones in China; Haiyan, City of Fastener in China; Yunhe, City of Wooden Toys in China; Shangyu, City of Umbrella in China; Shishi, City of Jacket in China; Liuyang, City of Fireworks in China; Lecong, City of Furniture in China... It's easier to find a right supplier when you know the correct direction.

3. Basic checking on your potential suppliers. Every Chinese company has a registered No. Get your Chinese supplier’s name in Chinese, go to the website of local Industrial & Commercial Bureau to find the basic company information if you read Chinese, or get the credit report from an unbiased service company. Google its name and contacts on internet will help you sort out the scammers. Pick up the phone, call the supplier’s office line instead of mobile phone, and see if the contact is valid. Then, send out your inquiries.


4. Due Diligence. Contact the potential suppliers and visit them if possible, either by yourself or ask an independent 3rd agent like us to help. Certification, MOQ, packing, price, communication ability, response time, payment term, lead time, references, etc. Is your supplier a trading company or factory? Do they export by themselves or through an import/export company? Make a judgment from combining the quality system, price, lead time, R & D abilities, management, technology and capability. Don’t fall for “the bigger, the stronger, is the better”; instead, choosing equal size and scale is well matched. This is especially true for the start-up companies to work with some not so big but with great potential suppliers. You need to calculate your landed cost and work with the supplier who undertakes to facilitate quality management system instead of just FOB price. Also, when your company grows, the old suppliers may not meet your requirements anymore, and you need to bravely choose another supplier.

5. Sample evaluation. You need to order samples from different potential suppliers. Be prepared to pay for the sample fees if the supplier asked. Asking a Chinese agent to help you collect all the samples and send you together can help you save a lot of freight cost. After received the samples, evaluate it either by yourself or through an official test lab.

6. Place an order Place a trial order with your selected supplier through a written purchase order. In the purchase order, be sure to include a detailed description of the products, trade terms, payment method, quality standard, a list of all necessary shipping documents, and penalty on delayed shipment. If you're trying to land a shipment for less than USD3000 directly from a Chinese factory, you're probably not at a volume that is worth importing and are better off working through wholesalers in your country.

7. Use a secure payment method L/C, PayPal, T/T 30% in advance as deposit; wire the 70% balance once received a copy of B/L. Never send out money by west union or MoneyGram to someone you know nothing. Or, your money has gone.

8. Pre-shipment inspection When the goods are ready, check on site either by yourself or appoint an independent 3rd party to check for you. Make sure that your supplier knows your checking criteria in advance. This will avoid a conflict of quality and reduce the chance of receiving defective or non-conforming products.

9. Shipping advice. To guarantee the goods will arrive on time, ask your Chinese supplier to send you the shipping advice including all the shipping documents like a copy of B/L, ETD, ETA info, invoice, packing list, etc. immediately once the goods left China port. You can trace the shipment by yourself or ask your freight forwarder or customs broker to take care of the transportation and customs clearance. Asking a detailed breakdown list of all the costs and regulations for importing the goods into county will help you get ready for the hidden costs of customs and shipping.

10. Gain experience. Experience builds business sensitivity, which is a key to be success. Many people find that they can spot a scam more quickly and locate a right supplier more easily after each time they imported from China.

Buying from China is more complicated than you purchasing domestically. But don’t get intimidated. Get out of your comfort zone, go visit China. Talking with your Chinese supplier face to face, visiting the factory facility will help you foster a mutual, long term business relationship. And work with dedicated Chinese partner will make your business of buying from China much easier!


Last edited by cbeebies; 12-07-2008 at 01:17 AM..
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