China sourcing agent

As a Startup, What 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 require 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;

Logo print
Custom colour
Custom product packing
Add extra accessories
Upgrade the quality of the product (use better and more expensive materials and components)

Avoid products with certification requirements

Toys, electronics, food and chemical products are regulated and require product certification. Far from all Chinese suppliers can manufacture products that are in compliance with American and European product certification requirements. Instead I would recommend a startup to import any of the following from China:

Textile products
Wristwatches
Accessories
Furniture (certain types may require testing for fire retardancy)
Bags
Leather goods
Jewelry
Wooden products
Gifts and art products
Promotional products
Phone accessories (non-electrical)
Computer accessories (non-electrical)
Cooking ware (certain types may require certification)
Fitness products (certain types may require certification)
Sports products (certain types may require certification)
Auto and MC parts and accessories (certain types may require certification)

Avoid buying from multiple suppliers

Many small businesses make the mistake of trying to bite off much more than they can swallow. Don’t expect that you can order fifty different products from seven or eight different suppliers. Below I explain why:

You’ll be limited to products that are mass-produced for the domestic market in China. The quality standards tend to be lower than what your customers would expect.
Limited to none customization options if you buy small volumes. No manufacturer is ready to send back “off shelf” products to the production line for modification or branding of some sort.
Too much administration. Importing from China is not like going down to the local supermarket and picking a little of this and that. You’ll need to provide your supplier with product specifications, buy samples and negotiate prices. This takes time, sometimes several months. Most startups simply don’t have the time and money to manage more than one product and supplier at a time.
High freight costs. One supplier equals one single shipment, and the freight companies quote much better prices when you order larger shipments.

How I would import from China on a low budget

If you’re on a low budget, I believe that the only viable strategy is to create a brand and maximize the number of products through simple forms of customization. Below I list a few examples on how this can be done:

Carpets in the same material but in different colours and cut into different shapes
IPhone 5 cases in different colours
Polo shirts of the same model and fabric, but with different sizes, colours and with different fabric details / print / embroidery
EVA Foam Rollers, same material but cut in different lengths

Simple modifications rarely require the supplier to increase the MOQ. Try to figure out what’s complicated and time consuming for a supplier to make, and what is not.

Complicated, expensive and time consuming modifications: Large increase on the MOQ requirement. This includes new moulds, purchasing new materials and components etc.
Simple modifications: Low or no MOQ increase. This includes logo print, different cutting, adding accessories, customized product packing, and custom colour.

Summary

Don’t attempt to buy too many products from too many different suppliers.
Avoid products that require certification
Avoid highly customized products
Brand an existing product as your own
Invest in quality and pitch yourself as a medium to high-end brand. Enjoy higher profit margins and don’t try to compete on price with the big players on the market.