China Sourcing – A Complete Guide to Profitably Import from China

Recently updated on November 24th, 2017 at 09:28 am

With a wide-spreading and long held status as Factory of the World, importing from China has proven to be a great strategy of international sourcing for many companies and startups. An expansive variety of consumer products made in China are quite prevailing all over the world including clothes, shoes, handbags, jewelry, cosmetics, furniture, etc.

In a nutshell, international trade is never something easy especially for the newbies with a complicated, costly importing process that can be unpredictable sometimes. Expected profits can often drop drastically by delays in delivery time, fluctuation of exchange rate, shipping costs, etc. Here we compiled a step by step guide to help sourcing products from China in a much hassle free way.

1. Check your importing certificates.

When you import from China wholesale, you become the importer. You will have to get the import rights as to let the goods comes in, or you have to find a reliable local import agent for Custom clearance.

Most of the importing regulations are only applicable to goods for commercial purposes. If you are just buying a small package with small value for personal use, most couriers like DHL/UPS/Fedex will just deliver to your door.

2. Choose the right products.

Doing a thorough market research and choosing the right products are essential to profitably importing from China to UK. Ask the suppliers about product information, if possible, get samples and test markets first.

With product information provided you can easily get the HS code and the rate of tariffs you have to pay while sourcing goods from China.

3. Make sure the goods you are about to buy from China are allowed into your country.

Not all the goods are allowed to be imported from China. Check the importing regulations in your country and confirm whether the products from China are subject to any restrictions.

Importing goods that are not permitted would end up costing you an arm and a leg in fines. Worse still, those products would be confiscated and destroyed.

When you are importing electronics/health products from China to Europe, make sure the suppliers can provide some certificates like ROSH, CE, etc.

4. Calculate the total costs.

Pay attention to the Incoterms while you are importing from China manufacturing companies. Usually most China imports wholesale suppliers would quote FOB price, which means free on board. You have to take care of shipping costs from China to your country, Customs declaration, tax, shipping to your warehouse, etc.

5. Source products from China and place orders.

Once you have selected the right products and negotiate everything with your Chinese suppliers, ask for a Proforma Invoice(P/I), a non-binding document that would cover price, product description, weight, packing information, bank account, IncoTerms, etc.

Dos:

1. Make sure the China manufacturing suppliers agree to ship under FOB terms to specific port or airport. For instance, if you are sourcing products from different cities in Guangdong, one supplier is in Shenzhen, one in Guangzhou and another one is in Zhongshan. Check which port you want to load the goods either from Shenzhen or Guangzhou and ensure the suppliers agree to it as this would cut off shipping costs and give you more control over shipment.
2. Prepare at least one or two months ahead if you are going to ship by sea as it would take much longer time. Moreover, you have to allow extra time for custom clearance, port handling procedures, etc.

Don’ts

1. Don’t look for the lowest price blindly.

If something is too good to be true, it is. There are lots of cases that foreign buyers were cheated of their hard-earned cash coz choosing “suppliers” of absurdly low prices. Low price usually comes with high risk, maybe quality, quantity or maybe you end up getting nothing at all, they just take the money and run away.

Choose a reliable supplier and grow with them.

2. Don’t assume Chinese factories understand exactly what you mean.

The worst part about sourcing goods from China is assumption. Assume people understand what you mean even though they say yes. Sometimes yes means with respect I’m listening to your shit. To make sure you receive exactly what you want it’s better to state it clearly and follow your orders closely. To increase the chance of getting the exact products, sometimes it is necessary to ship samples for double confirm.