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Buying from Wholesalers in China: 5 Things Importers Must Know

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Buying customized goods from manufacturers can be a hassle. It takes months to even get a sample, and you need to buy hundreds of units per product design, or even color.

Long lead times and high MOQs are a major barrier of entry for cash strapped startups, looking to import from China.

So why not just skip the factory and go to a Wholesaler instead? For starters, there no MOQ to worry about. Pick and mix whatever products you want. And you don’t even need to wait for six months to see them.

It sounds fantastic.

But things are not always what they seem. In fact, buying Wholesale goods from China may not even be an option for your business. If you are based in the US or Europe – you can be quite sure that it’s not.

Keep reading, and learn whether or not ‘buying Wholesale from China’ is on the table for your business.

1. Looking for a Wholesaler? Go to Yiwu.

Wholesalers can be found all over China. However, if you are looking for one geared towards export markets, there is only one place to go – Yiwu.

Yiwu is an old trading city, in China’s eastern Zhejiang province. The city is home to thousands of big and small trading companies and wholesalers.

As it is established as a cluster for export oriented wholesalers, you will find that the ‘infrastructure’ is far more developed, when it comes to finding local agents, quality control companies and export agencies – all of which are needed to buy, inspect and ship products from the wholesaler, to your warehouse.

But, if you keep reading, you will find out why ‘buying wholesale’ may not even be on the table. Continue Reading →

Minimum Order Quantity (MOQ) – Why It’s Required by Chinese Suppliers

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The Minimum Order Quantity (MOQ) requirement specifies the lowest quantity of a certain product that a supplier is willing to sell. If the importer cannot reach the MOQ requirement, then the supplier is not willing to enter production.

Supplier in China, and other low cost manufacturing countries, tend to have fairly high quantity requirements. In this post I explain why so is the case and what you can do about it.

1. Low profit margins demands larger volumes

Most Chinese manufacturers tend to operate on razor thin profit margins. Often as low as 3 to 4%. Low profit margins require the supplier to produce a large quantity of products in order to break even. Continue Reading →

5 Strategies to Lower Your Suppliers MOQ Requirement

Lower quantity requirement

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Chinese manufacturers are known for their rather high MOQ (Minimum Order Quantity) requirements. The MOQ is, by most suppliers, set on a ‘per product basis’. Thus, the total MOQ requirement is multiplied on the number of different SKUs, purchased from that same supplier. Assuming your product assortment includes at least a handful of SKUs, this quickly runs up the minimum quantity to thousands of units – far too much for most small businesses to digest.

Limiting the product assortment to one or two SKUs may be a viable option in some industries, but not for most. In this article, we share our experience on reducing your suppliers’ MOQ requirement by streamlining the usage of materials and components, limiting product customization – and through negotiations. But, before we go into details, I’ll begin by explaining why the MOQ requirement is a basic necessity for Chinese manufacturers.

Why Chinese manufacturers must set an MOQ requirement

China’s industrial cluster is like an onion. Most importers, however, only need to deal with the outer layer – the exporters. The exporters are essentially assembly manufacturers, putting the pieces together. But there’s a whole lot more going on ‘behind the scenes’. While a manufacturer may produce certain components (e.g. Watch cases), or manage certain refining processes (e.g. dying fabrics), in house, most components are purchased from subcontractors. Continue Reading →

Importing Small Volumes from China – The Ultimate Guide

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Buying products in small quantities from China can be challenging to say the least. It’s hard to reach the minimum order quantities and product certification testing can cost thousands of dollars. But that’s not all. The market is already crowded and even global corporations struggle to maintain decent profit margins. In this article we take a look into the key factors that makes the difference between success and failure when importing small volumes from China.

Why small volume importers still should buy from manufacturers

To begin with I want to make it clear that a small volume buyer should forget about stocking up a whole store or e-commerce site with custom made products imported from China. You can’t reach the required minimum order quantity requirements (I’ll get to that in a bit) and managing the whole purchasing process for as few as one or two products is already very demanding and time consuming for small businesses. Continue Reading →

Yiwu Wholesale Markets – Your Guide to Buying Small Volumes from China

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Yiwu is a city in the eastern Zhejiang province that has made a name for itself as a center for small commodity trading. In fact, it’s among the top destinations in the world for small buyers. While Yiwu is not a financial powerhouse like Shanghai or a world class manufacturing hub like Shenzhen, it’s still got something that other cities in China doesn’t – ready made products that can be purchased in small volumes.

“What is Off shelf?”

In this article I’m referring a lot to “off shelf” products, a topic that is highly related to the city of Yiwu. It’s in fact its main attraction and the biggest reasons for small businesses to make a visit. An off shelf product is a ready made item ready to be picked up by a buyer. Isn’t this the case everywhere in China? No, while many importers assume that buying from China is about the same thing as walking into a warehouse and pick this and that, it’s very far from the truth. Continue Reading →

Chinese Suppliers – Trading Companies and Manufacturers Explained

china-trading-company-manufacturer

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There are three main supplier categories to take into consideration when importing from China – Manufacturers, Trading Companies and Manufacturing & Trading Companies. While the type of company will not be the most important factor when selecting your suppliers, different types of suppliers will require a different approach during the sourcing process and have a major impact on the future of your import business.

Therefore it’s important to know what type of supplier you should look for when sourcing in China. Let’s begin with an introduction to the three major supplier types in China. Continue Reading →

Buying from Aliexpress: A Guide to Safe Imports

Buying from Aliexpress

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Aliexpress.com is a transaction-based wholesale platform for importing small volumes from China. It’s a huge resource for innovative and profitable products that cannot be found elsewhere in low quantities. While ordering products from Aliexpress is simple, there are a few things you can do to minimize your risks and increase your chances for long-term success. This article tells you why!

Based in America, Europe or Australia? Read this first!

Many products listed on Aliexpress are manufactured for the Chinese domestic market. These products may be just fine, but most are not compliant with product safety directives in Europe, America and Australia. Importing non-compliant items is illegal, and may result in a forced recall or major fines, in case anyone is injured or damaged.

Notice that it’s always the importer that is responsible for ensuring that imported items are compliant with relevant standards and directives. Chinese suppliers, including those selling on Aliexpress.com are not responsible.

If you still wish to import items from an Aliexpress supplier, you shall consider a laboratory test before making a larger order. You must also confirm which standard and/or directive is applicable to your product, in your country.

But there is help to get. You can either hire a China sourcing consultant, or purchase our Starter Package – which includes confirmation of applicable product safety directives for your product, and sourcing of compliant suppliers. Click here to read more.

Step 1: Source products and suppliers

Aliexpress is home to small Chinese trading companies and unlike Alibaba.com, where you have a lot of verified information on each Gold Supplier, you have very limited information on a Aliexpress supplier profile. This makes the supplier selection harder to define, but Aliexpress ]compensates for this shortcoming with customer feedback. For this reason, the supplier selection shall be based on buyer feedback to a large extent. The positive feedback number is a good start, but you’ll get a more balanced impression of the supplier if you review the negative feedback as well. Continue Reading →

What to import from China as a startup?

what to import from china

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This blog has been quick to mention that certain products are harder than others to import from China. In this post I’ll focus on product categories that are a bit more suitable for startups and beginners looking for what to import from China. I begin by explaining what you shouldn’t do.

Avoid OEM / Customized Products

Products that are highly customized requires higher MOQ requirements. This is simply because the supplier has to purchase components and materials from a larger number of subcontractors. Each subcontractor has its own MOQ (Minimum Order Quantity) requirements and this can quickly add up to an MOQ that you cannot reach.

Instead of importing an OEM product (custom designed) you can purchase a “standard product” and achieve customization through branding, such as the following: Continue Reading →