4 Tips to Consider Before Importing from China
Posted by Shannon Suetos on November 24, 2010 in Business Management [ 1 Comment ]
Time zones. Customs. Business practices. There are many obstacles for entrepreneurs working with China for the first time. While many of these cultural differences might seem overwhelming, there are a few guidelines every businessperson should know before ordering factory direct from a foreign market.
1. China is a Contractor – Not a Retailer
To have success working with a foreign market, business owners need to be flexible. Even if prices for supplies and materials are under contract at a fixed price, there are still going to be delays and hidden costs.
This isn’t to diminish the quality of the product, but you’ve got to keep in mind that you’re ordering directly from the source, not a big box store. Cheaper prices come as a result of cutting services like middle management, which directly affects the efficiency of your shipment.
2. Mark Your Calendar for the Chinese New Year
Chinese New Year can mean major delays. Since China celebrates their New Year using the lunar calendar, it doesn’t fall on the same day every year, but it does occur between January and February. Since a large majority of their billion-person population goes on vacation for 10 days or more during this time, you can save yourself the hassle of delays by ordering your second quarter goods during the fourth quarter of the previous year.
3. China is a big country
Including Alaska, the United States and China are relatively the same size in area (around 3.6 million square miles). It’s a ton of land to work with, and most of the time, you’re not going to work exclusively with one factory.
International business writer David Dayton says that you’re rarely going to work with one factory, let alone factories in one city. Plan accordingly. This will dictate the majority of your shipping timelines.
4. See the Factory for Yourself
When making a major international purchase, many sourcing experts agree that you need to visit a plant in China before placing an order.
On your visit, you should be inspecting the manufacturing areas as well as building business relationships with key decision makers at the factory. This will allow you to understand the raw materials being used on site and it will further your understanding of day-to-day business, which should help you in the negotiating process.
A face-to-face meeting will also prove that you are serious about using their services. Many factories will categorize some buyers as “picky clients” and if you can establish yourself as one of those, the factory is more likely to do its part to take special care of your products.
Be aware that some factories are known to show you certain business practices, and then make changes to product specifications, materials, or even factory requirements when you’re gone. It’s not the case all the time, but it’s one of the prices you have to pay when you’re working with China.
Emma T. is a writer for Global Sources, a leading business-to-business media company and a primary facilitator of trade with Greater China. They have experience in all industries, from furniture manufacturers to pharmaceutical manufacturers.