Despite the growing prices and labor costs, China will remain to be the most important manufacturing base for electronic equipment. Large, qualified workforce and perfect supply chain determine that for the following years most of the smartphones, tablets and other gadgets will be manufactured somewhere between Guangzhou and Shenzhen. But what should the importer keep in mind, if he is about to start importing? In our opinion, the whole process should be divided to several phases.
PHASE 1 – Cost evaluation and Planning
The potential importer should, from the very beginning, carefully evaluate his plan and investing capabilities. What does the target customer needs? What can the Chinese factories deliver? First of all, there is no need to import brand electronics, because the prices will be most likely very similar to Western prices or even higher. Most of these brand product are deliberately fake, and fake merchandise will most likely be seized by the customs.
Another important step is a cost-evaluation. Laptops, cellphones and tablets imported from China are exempted from duty in the EU, as for the other countries, the regulations should be checked. In most cases, Value Added Tax is applied, tax rate varies dependent on a country. Pay special attention to import duties especially when the product is new on market (for example smartwatch), sometimes the Chinese supplier will be able to provide you with the HS code of the product.
It can be said that in the most popular categories of electronic devices trade, the market is saturated. It may be hard to persuade customers to buy the no-so-good generic cellphone or mediocre tablet, because they already overflow the market. If you are aiming at the big success, think of something new and creative – just like GoPro.
PHASE 2 – Finding a Supplier
There are two main directions, to which Western customers turn at the first place: Alibaba and Aliexpress. The former serves for major transactions, the latter – for minor transactions and private purchase. It is always the best option to establish the close relationship with your supplier, and even if you buy only 100 to 200 pieces, you should buy it directly from the supplier. Choosing a trading company means higher cost and greater risks.
What kind of risks should be considered? Among the ordinary ones, which were described by our team before, the customer should pay special attention to the device specs. The cellphone, which is surprisingly cheap, has 12MP front camera and 8GB of internal memory? On paper only. Remember that you cannot get something extra for the price of something ordinary.
Of course, in certain cases, trading company is still a better choice. Especially when the producer is not willing to supply the small amount of products – in this case, we can order them at the trading company.
If the order is bigger, the best idea is to verify the supplier independently.
PHASE 3 – Logistics
How to choose the most proper way of delivery? There are several logistics solutions, suitable for the transport of electronic equipment. Air transport is expensive, but fast and reliable. Sea transport takes more time and is suitable for bigger orders (container quantities). Most of the people seek help of the international shipping companies, such us DHL or UPS, there is also a national post operator, China Post, which offers both air and sea delivery and competitive prices. The time of delivery and shipping fee depend on a target country and the differences may be quite huge. The distance doesn’t matter: sometimes it is more expensive to ship your goods to neighboring Mongolia than to remote New Zealand.
As far as small amounts of goods are concerned, organizing the whole shipping process is a piece of cake, things get hectic when your delivery quantity is greater. Soon enough you will realize that you cannot earn much on a small order, but getting a bigger order is far more risky and complicated. So, after all, which option is better? The decision is up to you.
PHASE 4 – Solving problems
In case that something goes wrong, you still have some chance to solve your problem. Remember that Aliexpress and Alibaba are not online shops; they serve as a platform to enable communication between buyers and suppliers, so cannot be hold responsible for the products’ shortcomings. If you are not satisfied with the received merchandise, you can “open a dispute” with the supplier. Some suppliers offer option of unconditional returns, so even if the product is working properly, you can still send it back. If you are not satisfied with the solutions suggested by the supplier, you can always complain to the b2b platform, but as far as we know, this is rather doomed to failure. People in charge of those webpages are dealing with the thousands of complains daily and are not really interested in strictly enforcing their own rules (it may have tremendous consequences for their business, because suppliers may be discouraged from using their services).
In the nearest future, the Chinese brands such as ZTE and Huawei will gain the reputation of the reliable, international brands, as it already happened with Lenovo (which is, frankly speaking, not always associated with China, because it bases on the IBM know-how and patents). But apart from those big companies, thousands of smaller one are operating, the products they offer are not necessarily inferior in terms of quality. The rule is simple: you get what you pay for. If you manage to successfully import some electronic equipment from China, find wholesalers in your country and provide functioning after-sale service for your clients, you can achieve major success.