Sourcing from China is a great way of reducing costs. Moreover, the variety of suppliers and production capacity makes it possible to manufacture anything you want in the requested quantity. Read further to get to know top tips on sourcing from China.
Sourcing from China – top tips for importers
What to source?
The fundamental question you need to answer is what type of goods you want to import from China. Popular products imported from China include household articles, consumer electronics, apparel, etc. But there are some products you should not import. For instance, you cannot import brand products you do not have the license to sell. Another category is low-margin products—they are just not worth it.
How to find Chinese suppliers to source your products?
The fundamental methods of searching for Chinese suppliers, distributors, or manufacturers are on the Internet, directly in China, or at in-person events that connect suppliers with buyers.
Chinese suppliers on the Internet
- Made-in-China is your to-visit e-commerce platform to find Chinese suppliers.
- Alibaba is the biggest B2B Chinese e-commerce marketplace. Chinese suppliers on Alibaba deliver to over 200 countries and regions all over the world. Check how to find the best suppliers on Alibaba.
- Global Sources in another major B2B marketplace. If you source electronics or products of the gift industry, make sure to check it out.
- DHgate connects Chinese suppliers with importers from all over the world.
Chinese suppliers prefer face-to-face contact
The truth is that companies that have face-to-face contact with the supplier are in a better position than companies without such contact. It is all because, in Chinese business culture, the relationship network guanxi is everything. Chinese people often seek long-term relationships. The better relationship you have with your Chinese partner, the more profits you get. If an opportunity arises, visit manufacturing bases, and attend industry fairs in China and abroad where there are Chinese exhibitors. Once you establish a relationship, make sure to nurture it.
How to make sure your supplier is reliable?
Finding a supplier is simple. Finding the right and reliable supplier is another matter. Even if the company has a Gold Supplier badge on Alibaba or a professional-looking website in English, it does not mean the firm is trustworthy. The best method to determine if the Chinese supplier is dependable is to conduct due diligence. You can get a credit report on the chosen supplier in a matter of days.
Once you choose your supplier and your order is in production, carry out quality control. Save money and time by conducting quality checks during production, after the order is completed, and before shipment. You have to verify whether:
- the quality is as expected
- products comply with your requirements
- the quantity is as ordered
- the documents and data are in order.
If you do not conduct any quality checks, you may be surprised when unloading the products at the port of destination. Some Chinese suppliers scam their clients by sending sandbags!
Do not cut cost by skimping on quality control measures. Spending some money on quality checks and alike will protect you from huge losses related to poor quality products, returns, damaged reputation in the market, and products recall due to safety hazards. In other words, not taking any quality control measures is not worth consumers and your business wellbeing.
Importing with your own brand
If you want to source from China, you have definitely come across terms such as ODM and OEM.
- ODM stands for original design manufacturer, meaning that the importer has total creative control over the design.
- OEM is an abbreviation for original equipment manufacturing. It means the importer sells an existing product under its brand.
Creating your own brand is a lengthy process, but it pays off. Your Chinese supplier will be happy to produce your goods and comply with your requirements and quality standards requests because if not, you may move on to another supplier—the more products you sell, the more money your supplier makes.
Placing on the market unique products makes your brand stand out. Protect your brand in China by registering your trademarks, so no one imitates you.
What about customs duties on products from China?
To determine duty rates, you need to choose your target market. Every country or state that is in a customs union applies different tariffs. The tariffs for a given product may vary depending on the country of origin. That is why providing a certificate of origin for customs release is important. If they were manufactured in a particular country, you may benefit from a preferential rate on your products.
Check your target market’s tariff system. In the EU, it is TARIC. In the US, it is Harmonized Tariff Schedule (HTS). Even if you add customs duty taxes and shipping costs, sourcing from China is cost-effective.
Importing from China – documents and certificates
Another important thing is product compliance. Only products that comply with the formal requirements of the target market can be put into circulation. Make sure to get familiar with regulations regarding standards and safety. For example, in the US, Consumer Product Safety Commission ensures the safety of products such as toys, household chemicals, and appliances. In the EU, there are many product categories that need CE marking and declaration of conformity.
Want more tips on importing from China? Check out our selection of resources.