How to Procure Products from China

When sourcing products from China, it's important to allocate time for several essential steps. These steps encompass identifying suitable suppliers, conducting factory audits before entering negotiations, assessing the suppliers' product development capabilities if necessary, and dedicating time to oversee the entire project. This process is intricate and can demand several hours each day. Here are the complete seven steps to successfully source products from China:

1. Conduct Market Research: Before launching your business, conducting comprehensive market research is imperative. Given the intense competition in the market, a well-informed approach is essential to stand out and succeed in your endeavors.

2. Establish Contact with Chinese Manufacturers: Connecting with Chinese manufacturers is a pivotal part of the sourcing process. Some individuals may be hesitant due to uncertainties about where to initiate or how to proceed. It's important to understand the different types of suppliers in China, including manufacturers, small trading companies, and purchasing companies. The choice of supplier depends on your business's size and requirements. If you are a major buyer capable of meeting a factory's minimum order quantity, dealing directly with the manufacturer is advantageous. If you require a diverse range of related products but are not buying in large quantities, a trading company can be a suitable choice. For supermarket businesses, sourcing from places like the Yiwu market might be beneficial, but this may require the assistance of a Yiwu agent. When dealing with products with specific technical requirements, sourcing directly from a manufacturer is often preferred.

3. Determine the Sourcing Channel: The sourcing process can be straightforward. You can start by visiting online wholesale platforms like Alibaba, which connects you to numerous qualified Chinese manufacturers. Search for the products you intend to purchase and send messages to at least 10-15 suppliers to initiate communication.

4. Negotiate with Suppliers: Effective negotiation with suppliers is crucial. Ensure you have all the necessary data and information to present your case. This will enable you to address the supplier's claims and understand the situation better. Suppliers receive numerous inquiries every day, including requests for samples. To demonstrate your seriousness and intention to conduct substantial business, you can use messages like, "Hello (company/contact), we are looking to place an initial order to assess product quality. We are interested in ordering (number of units) of (product). What would be your price for this order? Please note that we are also considering offers from your competitors. Thank you!" Avoid using the term "sample order" and instead refer to it as an "initial order." This phrasing conveys your commitment and seriousness about the business.

5. Initiate with Sample Orders: Once you've received quotes from manufacturers, it's time to select the most competitive offer and proceed with your initial order. When you receive your first batch of samples, it's essential to:

• Inspect multiple units to ensure consistent product quality.

• Scrutinize for any defects, damage, or low-quality components.

• If you're unsatisfied, consider requesting additional rounds of samples (2nd, 3rd, 4th, etc.) to make necessary improvements or explore alternative suppliers.

Additional factors to consider when ordering your initial sample round include factory location, available payment methods, and lead times.

6. Place a Bulk Order: Once you've meticulously followed the preceding steps, you are ready to place a substantial order from China. However, it's crucial to exercise caution when making payments to Chinese suppliers to avoid potential scams.

Common payment methods for sourcing products from China include providing an initial deposit, typically ranging from 30% to 100% of the order's total value, with the remaining balance due before shipment. This approach allows you to retain control over the final payment, which is made after quality inspections and laboratory testing have been completed.

7. Implement Quality Control Checks: While establishing a solid production agreement is an excellent way to initiate your collaboration with suppliers, ongoing quality control inspections are equally essential. These checks ensure that your product quality aligns with your defined standards, preventing costly issues that may arise in the later stages of production. Studies have consistently shown that addressing problems early in the production process is significantly less expensive than addressing them later.

8. Coordinate Shipment: In this stage, it is imperative to acquaint yourself with shipping incoterms, which are internationally recognized trade terms used to specify the timing and location of cargo transfer. Shipping goods from China may appear straightforward, but it is replete with complexities, primarily due to the abundance of forwarders available. When collaborating with an agent for the first time, prioritize transparent services over the lowest price. Typically, there are five main shipping methods from China:

• Air Express

• Air Freight

• LCL Ocean Freight (Less than Container Load)

• FCL Ocean Freight (Full Container Load)

• Expedited Ocean Freight