Importing from China – Five Mistakes to Avoid

Importing from China – Five Mistakes to Avoid

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Importing from China has never been easier, thanks to trade websites like goodada.com and Alibaba.com. However, if you’re a novice importer, there are still some common pitfalls to watch out for. Avoid these five mistakes when importing from China to maximise your profit margins and ultimately improve your chances of a successful import venture.

1. Rushing a supplier

If you’re new to importing, it can be tempting to try to rush the purchasing process in your eagerness to start selling. But as the saying goes, act in haste, repent at leisure! Impatience can mean failure to do thorough research and lead to making a poor choice of supplier, perhaps because they offered you a quicker delivery time or were simply the first to get back to you with an acceptable deal. If a supplier agrees to a rapid turnaround time, ask yourself what corners they may cut to achieve that. Or perhaps they’re just not that busy with orders – for good reason!

Insisting to a supplier that your order is urgent could also remove the incentive for them to offer you the very best price to win your business. Identifying a good product and supplier, and ensuring you’ve researched the import process and appropriately dealt with logistical requirements, takes time, so don’t cut corners to make – or lose – a quick buck!

2. Comparing apples with pears

When it comes to comparing products from different suppliers, the devil is in the detail. It’s easy to make the mistake of not being thorough enough in your product comparisons, especially if you’re guilty of error number one above!

In eagerness to secure a great deal, some importers will automatically choose the cheapest version of their chosen product – but cheapest doesn’t always mean the best value. There may be a huge difference in quality or specification to consider. Remember, a poor quality product that you can’t sell on or isn’t fit for purpose is a waste of money, no matter how cheap!

3. Overestimating profit

Working out your actual profit margin is more complicated than most first-time importers think – and overestimating profit is a common mistake. There’s much more to consider besides just the cost of the product and the cost of importing the product. Even if you’ve properly factored in all the expected costs such as PPE shipping, storage, import taxes, packaging, sellers’ fees, domestic courier costs, professional photography/copywriting, marketing, packing labour, business running costs, customer service and quality control, there may still be unexpected expenses that crop up – the cost of random customs inspections, for example.

It’s also important to build a contingency into your profit margin to cover goods that may arrive not quite up to scratch (see point five!) and customer returns.

4. Ordering too small

Understanding how ‘economies of scale’ work is vital when you’re first starting to import from China. The easy rule of thumb is that the bigger the order, the better the deal. For example, the quantity of goods you plan to order can affect the quote and service level given to you by the supplier. You will also find that your shipping quantity will affect your logistics cost per unit.

Of course, ordering more than you can realistically use or sell is a complete waste of money, so it can be a tricky balance to strike. Working out your optimum quantity before you order will help to maximise your profit margins.

5. Expecting too much

When importing from China, there may be a difference in the quality of the product provided and what you were expecting to receive. What a factory in China deems acceptable may not match what you’re offering your customers.

You can try to minimise this issue by being very clear from the beginning on your expectations and requirements. You should also remember points one and two when choosing your supplier and product. Another shrewd move is to build a quality control contingency into your profit margin calculations, so that a few not quite perfect products in the batch are already planned and accounted for.

It’s also worth remembering that even if you can’t visit a supplier’s factory yourself, you can arrange for a company to do this on your behalf. John Good, for example, offers a wide range of different types of Quality Control Inspections and Audits covering all stages of production and despatch. From a Factory Audit that provides a full overview of a Seller and their suitability to produce your product to quality control Inspections and laboratory testing.

There’s much to consider when you first start importing from China. On top of building and running a fledgeling business, importing from abroad can be a daunting prospect. Choose to use the freight forwarding services of a shipping company such as John Good, and you’ll have one less part of the importing process to worry about. For more information about Importing from China, check out 9 things to remember when importing from China.

5 minute read | By Denholm Good Logistics

Last updated: January 13, 2022 | Published: September 7, 2017

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