Many companies in the UK are interested to import from China to the UK. However, for many, this may appear to be a tedious and stressful task. It can be handled if you have a good understanding of the procedure.
Those of you who have tried to import items themselves, know that doing it correctly appears simple, but is tough. Importing from China to the UK has a wide range of problems that they must overcome.
Sellers in the west face a set of similar problems when importing from China. Taking note of issues that may likely crop up and solving for them early can make your sourcing experience smoother.
1. Language problem
Issue
You're not conversant in Chinese; your supplier is not fluent in English.
Solution
- Use simple English words and sentences, and more short sentences and bullet points in your emails.
- State requirements in clear-cut terms. Don't assume that your supplier will figure out what you mean.
- Request to speak to the same production manager about requirements, order status, quality inspections and so on.
- Download WeChat for instant messaging and video calls with your supplier.
2. Cultural barriers
Issue
You're used to a direct communication style; your supplier communicates indirectly. Your supplier may have a hierarchical structure based on respect and obedience to one's superiors.
Solution
- Ask your supplier to confirm whether they've understood all your requirements.
- Be polite and courteous, and even more so if you're speaking to an older and/or high-ranked employee.
- If you can say it better through a phone call rather than in writing, proactively schedule a video call with your supplier.
3. Different time zones
Working over different time zones is not a challenge when you:
- Know the time difference between your country and the places in China where you're doing business.
- Schedule your calls during a time that overlaps your working day as well your supplier's.
- Designate a period during the day or evening to write to your supplier or respond to their emails or messages.
4. No real visibility into the status of your order
Though you can hold your supplier to their promise of delivering your order within 'xx' days, you will also want to check in-between on how things are going. Here are some options you can explore:
- Set a reminder to ask your supplier about order status.
- Follow-up in a weekly or fortnightly email.
- Inform your supplier that you may conduct random quality control in China.
5. Receiving bad quality products
When you receive a few defective pieces, you want to make sure the supplier doesn't repeat it for other orders you were planning to place. Here are some steps you can take:
a. Assess the damage.
b. See if the pieces can be repaired or they must be replaced, that is, new ones made.
c. Inform your supplier about the revenue loss caused and negotiate a free repair/replacement.
d. If you can absorb the loss without a big impact to your business, think about whether you instead want to negotiate a discount on your next order.
e. Revisit product specifications with your supplier.
Never make the full payment before you receive your order. A 30% deposit upon placing the order, and the remaining 70% after shipping reduces your risk. As the initial payment will cover a small part of production costs, your supplier will have the incentive to deliver quality products to receive the bulk of the payment. Any defects caught during quality inspections will only mean additional work for the supplier, which they could have avoided in the first place.
6. Dealing with crackdowns, labour issues and other events in China
Imagine waking up to an email from your supplier informing you that production will be delayed by a month. Turns out that the government has temporarily shut down their raw materials supplier as the factory did not meet environmental laws. This was the situation about five years ago but is an example of how your supplier may wait to convey bad news to you.
Chinese suppliers' reluctance to ask questions if they don't understand a certain requirement or contact you quickly about news that may affect your order can prove risky to your business. Poor quality and delivery delays make your business look unreliable before customers. Providing acceptable quality and meeting delivery timelines is even more important when you're selling on Amazon for the first time and trying to establish your business.
1. Select an appropriate product to import
Almost every product has a specialty, but knowing how to deliver your product correctly is even more important for your business. When choosing the appropriate product, you must consider the market trend as well as your available budget. You will, however, be assured of your success if you have adequate funds and a decent approach.
Follow the guidelines below to find the right product:
When it comes to engaging with people, brands are essential. Rather than attempting to sell a reasonably affordable product, create a brand that connects with your clients to maintain a long-term business relation.
The demand for fad products disappears rapidly, and it's impossible to build a brand name forever. Therefore, decide to focus on your long-term goals by purchasing products that provide monetary gains.
It's difficult for your product to succeed without a point of difference that sets it apart from the competition. However, the point of difference doesn’t need to be critical, but it can be as simple as a unique mix, a unique logo, packaging, or exceptional marketing photos.
Stay away from harmful goods, when direct sourcing from China to the UK. Dealing with product liability will completely ruin your company.
It is normal for businesses to take on too much responsibility too soon and then struggle. It is advised to have ideas for extra product possibilities, design enhancements, and adjustments, but it's not necessary to have all of this figured out before placing your first order with your China product manufacturers to import from China to the UK.
2. Find a right Chinese supplier
Alibaba
Alibaba website is the world's largest online supplier directory, with around 8.5 million suppliers and 279 million customers. It is primarily a B2B business service. No matter, what your product or niche is this online directly has at least more than 10 suppliers for it. However, you will have to buy in bulk because most makers have a MOQ (minimum order quantity).
This can be beneficial in terms of acquiring the affordable product. Simply search for the item on Alibaba with the words 'manufacturer' or 'private label' in the search box to find makers and suppliers. If you become a verified buyer, you'll have access to a vast and complex supplier directory. This allows you to look for experienced suppliers, examine a list of their most important clients, analyze their trade records, and get other background information.
Although you can still look for certain suppliers without becoming a verified buyer, you'll have more security and knowledge as a confirmed client.
Tradeshows
China is not only the world's largest manufacturer, but it's also one of the most popular destinations for online sellers to offer their manufacturing to the UK. If you want to fly to China to meet manufacturers face to face, there are a variety of trade shows to choose from. Yiwu Market, and Canton Fair, are a few of the major trade fairs where you will find authentic Chinese suppliers.
3. Contact the Chinese supplier
It's critical that you properly format your initial RFQ (request for quote) and email. The response rate from Chinese manufacturers increases when you pay special attention to the procedure of evaluating and pursuing Chinese verified suppliers. You must establish in your email that you are a potential client for the manufacturing company, as well as a knowledgeable and trustworthy organization that wants to import from China to the UK.
- Your email should have clear calls to action and should be concise.
- Your email should include the correct terminology for raw materials, testing requirements, and elements.
- An attachment with a simple product description sheet should be included in your RFQ.
Visiting a provider's manufacturing facility is the most effective way to determine whether a source is suitable. Visiting the production site allows you to visualize the machinery, confirm the factory's capability, and assess the quality of the sample, the factory's internal control systems, and the manufacturing plant's manpower.
It also allows you to directly talk to the factory's leaders, to further negotiate on price and to build a healthy relation.
This is typically a crucial stage for enterprises that are already established and looking to import to the UK from China. If you don't have the time to travel to the other side of the world to look at potential Chinese suppliers, you'll need to hire third-party Chinese sourcing company to look over for you.
4. Negotiate price and MOQ
There is always room for negotiating the price, but you don't want to drive the price so low that product quality suffers. So, what can you do?
- Get data on raw material costs for your product. Compare quotes and MOQs for your product or a similar product on online supplier directories.
- Based on your findings, challenge suppliers that are quoting higher prices or citing an increase in raw material costs for the high quote.
- Request quotes from multiple suppliers. Share competitive quotes from suppliers with those who're charging you higher.
- Ask suppliers for their best pricing for different MOQs. For example, you can ask the best possible price they can offer based on 500, 1000 and 3000 units.
Negotiate prices before making a commitment to the supplier. After the prototypes and moulds are ready, your supplier is unlikely to be open to lowering the price. They also know that you won't dump them and find another supplier after spending weeks and hundreds of pounds on tooling and prototyping.
The total cost of manufacturing and importing your product to your distribution center or warehouse within the market you're selling it is called the landed cost. It's beneficial to calculate your landed price, as they'll serve as a starting point for cost negotiations with suppliers. If your landed cost only allows a 5% margin of profit or less compared to the current market trend, then you've not done a good job in negotiating and sourcing.
5. Quality control
The initial sample is called the 'golden sample' as it is the basis on which the manufacturing contract is awarded to the supplier. It is evidence of the factory's capability to make your product. While your supplier may be more than capable to make your custom product, there is no guarantee that each of your products will be a replica of the awesome golden sample. This makes quality inspections crucial.
You should assign a QC inspector to conduct checks at different points during production, including:
Tooling: Make sure the moulds, fixtures, gauges, cutting equipment or other components and machines your product needs are in place before mass production begins.
In-process checks: The inspector will randomly select items from different batches for a quality inspection. This is to ensure your products have been made to a consistent quality. You receive an inspection report with the findings.
Pre-shipment inspections: This is a final check of the order quantities before your shipment is ready to be shipped to you.
If all quality checks have been done diligently, you should have no complaints about how your products turned out.
Thousands of British companies gain profit consistently by purchasing from Chinese manufacturers and engaging in importing from China to the UK. They must identify a product, choose a Chinese factory that will manufacture it cheaply, bring it to the UK market, optimize the branding and marketing, and watch the money coming in.
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