Exhibition season starts & Amazon policy changes

It has been a hectic week for me, exhibition season started and I went to the GlobalSources Electronics show this morning to check out some of the newest products.

I’ll give you a recap of the trends at the end of the month as usual but here are some first impressions.

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Arriving at the halls

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Are these camera’s still selling?

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An actual AI at the show

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Virtual Reality (VR) becoming more popular

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GlobalSources will hold a drone racing championship here. Curious to see.

For previous recaps have a look here:
https://importdojo.com/news-and-trends-from-the-exhibition-april-2016/
https://importdojo.com/the-cantonfair-all-you-need-to-know-about-the-biggest-expo-in-asia/

For what you can expect or what you can prepare have a look here:
https://importdojo.com/news-and-trends-from-the-exhibitions-in-asia/

Here is a list of the most important exhibitions coming up:

http://www.globalsources.com/NEWS/TRADE_SHOW_CALENDAR_OCTOBER2016_A.pdf

You probably heard about the two big changes on recent Amazon policy updates (today & last week) so I wanted to give you my two cents and what you can do:

Amazon review policy update

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https://www.amazon.com/p/feature/abpto3jt7fhb5oc

Last week (3rd of October) Amazon made an important announcement on its policy change in terms of reviews.

In short you are not allowed to ask for reviews in exchange for a discount or free product (anymore). This has been coming for a while.
First Amazon requested that reviewers spent a total of 5$ before they can leave a review, then in September this year this threshold was risen to 50$ and now only regular purchased products may be reviewed (or trough Amazon’s Vine Program).

I personally think this is super positive for sellers who try to build a brand and pay attention to quality and customer service. Will it be harder to get reviews and boost rankings? Yes for sure but it will also mean that those that are trying to make a quick buck will fail which means more room and profits for us hard working peeps 🙂

This will hopefully remove a lot of pushy Chinese factories and get rid of poor quality items. The many months you spent on perfecting a product sitting in front of your computer trying to come up with an additional value for your customer or how you can deliver better quality products are finally appreciated.

I’ve always said that building a brand together with social media and outside traffic is important right from the beginning.

My two cents:

  • PRO:
    less giveaways – more profits for me
    better quality products
    less Chinese sellers pushing the price down
    reviews that you get now are a reflection of your dedication to your products
    Having built an audience (social media) pays off
  • CONS:
    it will take longer to gain traction & sales launching a product
    And thats really the only con I see here….

Do it “right” from the beginning, build a brand and and audience on social media following and quality products
The point I am trying to make is not to worry too much about getting your product on the map if you have either:

  1. A superior product and listing
  2. A product that is highly in demand (just follow trendy websites and you will find those niches)
  3. Social media to drive traffic to your listings.

Reviews will eventually come. And those reviews will be a reflection of the hard work you’ve put into your product.

The best thing about this change is I don’t have to set away a ridiculous amount of units for reviews – saving me a lot of money.
The downside? Yes, it simply takes longer to gain traction but who said this is a get-rich-quick scheme?
Every business takes time and unlike a lot of people out there tell you, be patient, put in the work and you’ll get rewarded eventually.

Now, if you haven’t yet its time to set up services like Salesbacker (Salesbacker). The only way you can ask for reviews is with programs and autoresponders like SALESBACKER because this is integrated in your Amazon account and the people who are asked to leave reviews have bought at a full price (or discounted price that you list public). Salesbacker works very well for my products. Usually every 2nd-3rd buyer leaves a review.

So if you are worried about your intial launch I recommend that you launch your product at a discounted price for a few hours/maybe a day and see how sales come in and you MUST have Salesbacker installed before that and wait until reviews come in. Then you jack up the price again to normal. It’s perfectly within TOS and has worked well for me on a few products.

It has become very important now to build outside traffic trough social media or advertising. Even more important is to have the right supplier and add value to your product. Check out my case study on how I did it:
https://importdojo.com/importdojo-masterclass/

The second big change came in this morning:

https://www.bloomberg.com/news/articles/2016-10-11/amazon-said-to-limit-warehouse-access-to-new-merchants
Amazon now restricts new sellers that you cannot ship anything to their warehouses if you have not yet shipped any products to Amazon by 10th of October. You can still sign up for FBA but your first shipment will have to wait until 19th of December.

I believe that their warehouses are bursting and they are trying to avoid overcrowding and “clogging” of products that are new and have no sales record/history. Same thing happened last year during Q4 but only affected a few categories like toys. Now it affects all categories. This will certainly upset a few people who’s first shipment may be on the way or is being produced right now. Not only will those sellers miss out Q4 sales but also might be stuck with their inventory at some warehouse at additional costs. If you can wait it out good, if not I recommend to do the following:

Switch your incoming inventory to FBM (Fulfilled by Merchant) and ship your product to a fullfilment warehouse in the US. Here is a list of warehouses from reddit: https://www.reddit.com/r/FulfillmentByAmazon/comments/3eq4m0/updated_list_of_fba_prep_and_ship_companies/

It is perfectly OK to sell in Q4 BUT ship from your own (or third party) warehouse. There’s no offiicial statement from Amazon yet but I think below screenshot says it all

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I hope the recent changes didn’t put you off or de-motivate you. I’ve seen some of my products or friends product hit page 1/2 after a few days without doing much.I believe if you put in the work and add value to your product you can succeed.

All the best & happy sourcing,
Manuel

https://importdojo.com/importdojo-masterclass/

The ultimate guide on how to find a product

 

How to find a product?

This is the number 1 question I get asked on almost a daily basis. I have no definite answer for you today but I will try to break it down in two sections and a step by step guide on how I select products and hopefully you’ll get a few ideas 🙂

Lets look at your personal situation (scenario) first and then see how you can benefit from your scenario when picking the product.

1) How to pick your product niche:

Scenario 1: You’ve got money

Congratulations! While it is easier to get started the question of what product you are going to pick still remains open. More on that below.

Scenario 2: You don’t have money and you’re scraping together every little cent you have to reach 5,000$ because that’s the budget you heard of is the minimum (well its my minimum that I recommend to everyone).

While it is more difficult to get started you have the same starting point like everyone else out there. You probably want to make sure that the product you are going to pick is worth the investment. But even if your first product is not a killer don’t worry. You learn a lot in the process and in most cases you can at least get your investment back. Read on.

Scenario 3: You have a large follower-ship on social media

You are in a great spot. You already have a list of customers to get your launch and product going. It is imperative to pick a product that fits your social media.
In my recent case study (https://importdojo.com/case-study-how-i-went-from-zero-to-7000us-in-10-days-in-one-of-the-most-competitive-amazon-niches/) I reached out to bloggers and that boosted my launch immensely. Even nearly 3 months after my launch I still get sales from that site.

What does that mean if you have a large followership? Lets say I have an Instagram account with 50,000 followers that talks about eating healthy, fitness, the outdoors etc.. I could launch so many products to that followership, even competitive niches. For example:

  • Yoga mats
  • Accessories for the gym (tumblers, bags, sporting items etc.)
  • Backpacks, travelling gear, camping accessories
  • etc.

When you research your future niche and have decided on it build social media right away if possible. A client of mine built a social media follower-ship of 8,000 followers within 2 months (various social sites) and then launched her product. She sold nearly 100 pieces the first week only trough social media. That helped boost her organic sales and the rest is history.

So consider social media right from the beginning when choosing a product.
Ideally you will want to enlarge your assortment with similar products that all fit into your following. For example if your first product was a yoga mat and your followership is about exercising etc. it probably doesn’t make a lot of sense that your next product is a vacuum cleaner.

Scenario 4: You have passion about a certain product category

Let’s just say you love the outdoors, hiking, camping, and exercising in general (like me). So many products to choose from but you have one advantage. You know what you like and what your product should be able to do. You already have an advantage over many other competitors. Your passion for this category goes into your product. E.g. if you were to be upset about quality of camping mats you would already know what to tell your supplier where to improve. Look into categories you have passion for and then choose a product that you feel you can talk about, improve and passion in selling for.

For example if you like cooking you could look at developing a product that makes a certain cooking process easier. The exciting thing about this is that all your passion also goes into your product and listing and people just buy your stuff because you are so convinced of your product yourself.

For example I recently bought a travel bag from a German entrepreneur based in Thailand who loves travelling. Over the years he went trough so many of his traveling bags already because they were of poor quality (the straps broke, the leather peeled off etc.) and he decided to make his own bags. After 6 months of hard work he launched his site and product and it took off immediately. All his passion went into his product and site (https://www.travlmind.com/). You could tell by his story that he was really passionate about creating the best bags out there and not just copying the big brands. And only that convinced me to buy one of the bags even that it was at a higher price tag.

Scenario 5: You have vast experience in a certain industry

Lets imagine you have 17 years of experience in selling electronics (like me). What was the first product I picked? It was an electronic item. Why? Because that’s where I had my experience in. I believe you should not just have passion about your product but also have experience. When I sell a product online I want to be able to answer customers questions and inquires. To be able to do that I need experience in that category. Your passion and experience goes into creating your product. So when I choose my first product I improved an existing item based on my experience in that industry: https://importdojo.com/how-i-started-my-own-private-label/

So if you have a lot of experience in a certain industry make that industry your first product category.

Don’t have experience in a certain industry? What about a hobby? Or are you a parent? I am sure if you are a parent you have lots of experience with your kid/children and you could start in that category 🙂

Scenario 6: You have none of the above

Not to worry or be frustrated. Most of the people I know that get started start with Scenario 6 and there are still many success stories out there if you are within this scenario. Here’s an approach that you could use:

First: Take out a notebook and create a list of your interests and hobbies (or responsibilities as a parent for example) e.g. kitchen products, electronics, sports, your kids etc.. Yes actually write it down. Call me a bit old fashioned but I like to drop down ideas in written 🙂

Second: subscribe to newsletters of companies that talk about or sell products of your interests. See below on which sites for example (point 2)

Third: Gather a list of potential products from that niche. Collect at least 10 ideas.

Fourth: Research phase. Junglescout, Amazon, eBay, jet.com, local shop that sells the products etc.
See if there is any demand? Or is there space for one more seller (you)?

Fifth: If there is no demand is it because the product is in its fledging stages? Can you improve the product with your passion and interest in this product? Yes? Create a To-Do list of what you can improve based on customers reviews, what friends and family say etc. and move onto finding a supplier.

Sixth: No? Are you still convinced of the product? Follow your gut feeling and also ask around in friend circles. Move onto finding a supplier

Seven: No demand at all? Move onto product 2 of your list of ideas.

Lets say you found your niche, category or general product idea. Depending on above scenarios here are a few examples on how to find your product:

2) How to find your product ideas:

Choose your scenario and lets look at the following options:

  1. Amazon
  2. Blogs, Gadget or trendy sites
  3. Exhibitions
  4. Supermarkets, shopping malls
  5. Tools
  6. When travelling
  7. Alibaba & Globalsources

1) Amazon
You could look for hours on Amazon in the different categories and niches if you already have a certain product idea. But if you have no idea to start I suggest you start with the best seller list: http://amzn.to/1ZN3rY3

2) Blogs, gadget or trendy sites

Please don’t just look on Amazon! While there are great tools out there to scout Amazon for products (Junglescout, Cashcowpro etc.) I get many of my ideas outside Amazon.

One of my favorite site to find interesting blogs and trendy websites is Kadaza. It’s a collection of the best and most interesting sites on product ideas:

http://www.kadaza.com/

Click on any of the categories and you will find x amount of websites in that niche. For example if you look under the Tech category (http://www.kadaza.com/tech) you will find “The Gadget Flow”. By subscribing to their newsletter you get weekly updates on trendy items (that may not even be on Amazon yet). Lets take a look at an example:

Just a few days ago I received an email from The Gadget Flow. Its a site that I subscribe to among many others. I found the site by looking trough above Kadaza links.

So when I opened the email there were a lot of products that are currently on sites like Kickstarter or other similar sites. But you know what? If its only on Kickstarter now it means it isn’t on Amazon yet hence you can take the product idea and even improve on it. So I looked at the first product that caught my attention (lots of other good ideas too in that email):

 

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After clicking on the link I found that the company is based in Denmark and funded their product “the Sitpack” successfully on Kickstarter.

 

 

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Just a quick search on Alibaba.com and I immediately find a supplier:

 

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As you can see the supplier either stole the pictures or he is the actual producer for this company. I think it is the first one but it could be that they are the sole manufacturer.

 

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Now I go on Amazon and see that there is only one seller, the actual company “Sitpack” selling for 149$!!! Look at the listing. So much to improve!!

 

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Also I am pretty sure that this product does not cost more than 10$ to manufacture. Wow what a margin!

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Either way, the point I want to get to you is not to copy these companies but find ideas on blog sites (subscribe to them) and see how quick and easy you can research suppliers on Alibaba or Globalsources for suppliers. Maybe add an accessory, change colors or whatever you feel could improve the product. The best thing about subscribing to these sites is that you get ideas delivered for free to your email address.

3) Exhibitions
One of my favorite and most efficient way to find new products is at exhibitions. There are hundreds of exhibitions each year in many countries. You get to meet the supplier, see the products, and talk over details such as prices, models, and much more. On top of all of that I guarantee you that you will get inspired. To find exhibitions near you just Google the exhibition center near you and get your entry ticket. Most times you will need to provide name cards and contact details for that. You can order business cards for $5 these days. Going to an exhibition prepared and with a professional image gives the supplier a great impression of you.

There are countless exhibitions around Asia throughout the year but mostly during April and October. Here is a list of exhibitions for October 2016: http://www.globalsources.com/NEWS/TRADE_SHOW_CALENDAR_OCTOBER2016_A.pdf

A great write up from one of webretailers earlier posts of Danny McMillan who I had the pleasure of meeting in Hong Kong in April: http://www.webretailer.com/lean-commerce/sourcing-trip-china/

4) Supermarkets, shopping malls
Another way to find new products is obviously when you are out in a shopping mall or a local shop. To start your own import business means that you also work when you are out with friends/family at a shopping mall. Keep your eyes open and when you see something cool make a reminder for yourself on your smart phone to look the product up later.

5) Tools

A) Junglescout
You have probably heard of Junglescout already. Junglescout is probably the most advanced tool when it comes to navigating Amazon and finding bestseller products. Jungle Scout integrates into your Google Chrome browser, streamlining your product research. Extract rank, sales volume, FBA fee’s, type and quantity and a lot more! From what I hear soon also available for the German market.

I had the chance to meeet Junglescout’s founder Greg Mercer twice. He is a really cool and down to earth guy who seems to work purely for the community. Check out his blog and site where you can get hundreds of product ideas itself if not using his tool.

B) Cashcowpro

In January this year I was contacted by Antoni Watts, the founder of CashCowPro. I looked up his tool and was amazed by how he has probably put together the most comprehensive tool that not only helps to boost sales but also provides accurate insightful metrics for selling on Amazon. From all the tools out there I think this is my favorite when it comes to keeping track of all my sales as well as testing features.

It also works also iPhone and Android APP. Within the tool there is a Top 100,000 NICHE selector… They actually scanned over 100 million products + ASINs on Amazon to create this list.
They automatically calculate the factory cost and Air + Sea freight to give you the Top 100,000 most profitable NICHES on Amazon. Not products, but actual NICHES, using the average of the TOP 5 ranking products for each Niche to calculate the overall performance. The tool has many more functions apart from the niche selector that you can see here:

 

6) Travelling

Travelling is also a great way to find ideas. When you are out of your country or state you will likely see items that your country/state does not have. There could be many reasons why they may not be available where you live, but it’s always worth it to check an idea out. I remember when my friend told me about 10 years ago about Bubble Tea & Fancy Green Tea drinks sold in Hong Kong and Asia. She was from Germany and she had never seen these drinks back home. She didn’t go on any further with that idea but a few years later back in Germany these drinks started to pop up and were a smashing hit! So even when you think at first that idea might be nothing, it could be worth millions! Share the idea with a few friends and brainstorm about it.

7) Alibaba & Globalsources

A) Alibaba

First off when you sign up on Alibaba you generally need to fill in which product categories you are interested in. Based on this criteria and your recent product searches on Alibaba you’ll get automated emails with new product deals. Als you can subscribe look in their “selection site” where they post a lot of the newest and trendiest items from their suppliers:

http://selection.alibaba.com/?spm=a2700.7848340.0.0.tevCsV&tracelog=hd__cor_selection

B) Globalsources

Pretty much the same with Globalsources. You sign up and get automated emails with great product deals here. But not enough, they also have a section with the best deals and newest products out of every product category: Top Products. And my favourite part are their eMagazines that are updated on a monthly basis with the hottest and newest product alerts on their site.

Check out the links listed above and browse trough hundreds of products. Use the techniques and step by step scenario as described above depending on your situation.

Well that’s all I can think of today but there are literally so many other ways to find products. Even if you personally went trough some of the above ideas already I hope there’s still something for you that could help to find your next or first product. Some more ideas on how to find the “perfect” product also in one of my earlier guest blog posts from Thomas Albiez based in Switzerland: https://importdojo.com/how-to-find-the-perfect-product-2/

Once thing I can recommend everyone at some point is to come to Asia and visit some of the exhibitions. I feel it is just the most efficient way to find products. I know it may not be cheap to come here but I can guarantee its worth it. A plane ticket and a few nights at a cheap hotel can go from $1500. But you’ll see actual suppliers, products and samples in real. Saving you a lot of money and time in the process. Here are a few impressions from October last year and this year April’s exhibitions :

https://importdojo.com/news-and-trends-from-the-exhibitions-in-asia/

https://importdojo.com/news-and-trends-from-the-exhibition-april-2016/

I hope you enjoyed this post and that I could somehow inspire you a little bit to find your product ☺

All the best and happy sourcing,
Manuel

 

Ps.: some of the links are affiliate links and at no additional cost to you, I will earn a small commission if you decide to make a purchase.  I have personally used and tested all of these products or companies, and I recommend them because they are helpful and useful, not because of the small commissions I make if you decide to buy something. The cost to you remains the same, sometimes even cheaper if I have negotiated a special deal for our readers. Please do not purchase these products unless you feel you need them or that they will help you achieve your goals.

News and trends from the exhibition (April 2016)

So this post seems to be a recurring and I won’t break habits and therefore continue this series of giving you the news and trends from this April exhibition with the following sum up 🙂 I am also doing a Q&A at the end of this post, check it out. 

It has been a very busy 5 weeks for me as I’ve been to 12 different shows and I can see that more and more Amazon sellers are coming to Asia to visit the suppliers and shows. 

When I asked suppliers at exhibitions 2 years ago if they sell into Amazon they had no clue as to who Amazon is. When you ask them now if they sell to the US you get: “oh yes sure, we have many buyers on Amazon”. 

Not that I am afraid of competition but there is clearly a sign that sellers realize you need to go to the source to find the right products and suppliers. 

In recent months I have seen a gradual decline of my business to retailers (offline business) and more and more eCommerce sellers are starting to come to Asia to see the suppliers. 

This is a huge sign. Whether you plan selling on Amazon, your own eCommerce store or other online platforms (eBay, Spotify etc.) NOW is the time to get into importing and private labeling.

I see a lot of repetition at the shows but there are clear trends in several categories and I was able to find a few golden nuggets that I am thinking of launching as my next products:

Personal Transportation

The famous “hoover board” is almost outdated and I saw many new types of transportation devices. Personally I am not getting into this category as I believe it is too risky and their are no clear saftey standards. 

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Decorative items

Lots and lots of nice products at both the Houseware fair (HKTDC), Cantonfair (Phase 2) as well as the Home and Premium show (Globalsources). 

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My wife would have a difficult time choosing from the huge variety of products – there are lots of nice looking items 🙂

Interestingly but not surprisingly I met most of the Amazon sellers from overseas at the house ware/kitchen shows. A clear sign that this category is heavily competitive but also very popular AND still profitable. 

High quality and branded Chinese/Korean/Japan goods

Be it a mini projector screen from Korea, a “Lego” like learning tool for kids from Japan or high end bycicle helemts (with bluetooth) from China. Asian brands are starting to make waves and their quality is excellent. 

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However in most cases these factories are only looking for distributors and are selling their products with their own brand on Amazon or other channels. Private Label is not really welcome and if it is very high MOQ’s are necessary. 

However it is a good sign and nice to know that the asian brands are catching up in terms of quality, innovation and development. 

Sporting and camping products

A category that I personally love because I like the outdoors and love to work out. Seen a lot of suppliers offering things from kettle bells to yoga mats to roof tents. I found myself 2 products that I am thinking of launching soon. 

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While it is getting more competitive I think that with the right marketing, packaging and photos on your listing this is still a very good niche. 

Two categories that I have seen everywhere no matter if it was a houseware or gardening show: 

1) Silicone kitchen products! 

You see them everywhere on nearly every booth. Either from a trading company who’s main manufacturing line are electronics or from the actual manufacturer. My advice – be creative and don’t try to private label the next silicone mat. 

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This category is too saturated 

2) Vaccum flask / Tumblers 

Same here. I don’t know what it is but it seems when factories hear that their neighbouring factory is selling stainless steel tumblers like hot cake, they have nothing better to do than adding them as well into their assortment thinking they will sell them too – even though 40 other factories in the area are selling them already as well. Nearly every booth at the house ware and gifts show had tumblers and flasks in their booths. So unless you have a buyer list of 50,000 people and can sell your next stainless steel tumbler – Please don’t go into that category – the competition is too big. 

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The Global Sources Sourcing Summit:

https://smartchinasourcingsummit.instapage.com/

I had the honour of being the opening speaker at the Global Sources Sourcing Summit. There were about 65 (or becoming) Amazon sellers attending this event and I can say that it was truly a very exciting opportunity.

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During my speech

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Discussing strategies with a fellow Amazon seller

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Shall we go into Silicone products?

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Impressions from and after the Sourcing Summit with attendees.

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Q&A panel at the Sourcing Summit

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Will Tjernlund and fans 🙂

The line up of speakers was really impressive and to be honest I felt intimidated to be among such great speakers. We had Greg Mercer from Junglescout, Anthony Lee from Zonblast, Will Tjernlund (the Multi-Million $ Seller) Ash Monga from Imexsourcing, Mike Bellamy from Passage Maker …… among many other great speakers. The line up and summary is here: https://smartchinasourcingsummit.instapage.com/

But most of all it was great to meet so many Amazon sellers. I had some time in between to discuss strategies, procedures, importing and all that comes along being an Amazon seller myself. 

This was such a great event and I am happy to say that I will be at the next one in October 2016: 

https://smartchinasourcingsummit.eventgrid.com/

Factory trip to Shenzhen:

I had the opportunity to go with some ImportDojo members to their factory in Shenzhen to see the production and help negotiate prices:

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Arriving in Shenzhen

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At the factory with Omar who started less than a year ago and now working on several SKU’s.

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These guys seem happy with their product and factory choice 🙂

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Checking out the production.

UPDATE CASE STUDY: 

In the midst of everything I launched my newest product and case study item:

http://amzn.to/1TdzvFI

As of today my inventory down to 580 pieces (from 1008 pieces), 417 pieces sold in less than 6 weeks in a very competitive niche. I have nearly re-couped my entire investment (8000$) and I just put in a re-order with my factory for 2500 pieces (shipped by SEA this time) which should last me at least 4 months from date of arrival. 

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You can read on my previous update here and I will soon post another one: 

https://importdojo.com/case-study-how-i-went-from-zero-to-7000us-in-10-days-in-one-of-the-most-competitive-amazon-niches/

Impressions from the shows

CANTONFAIR 

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Breakfast for champions! A fellow Austrian brought me the famous Manner Schnitten from Austria and I had to have them for breakfast – thanks Stefan!

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As usual a crowded train on the day before the Canton Fair starts. Make sure to book your tickets in advance and pick them up at the train station in Hung Hom (HK) otherwise you end up waiting for a train hours later: http://www.it3.mtr.com.hk/B2C/frmFareGuangdong.asp?strLang=Eng

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walking to my hotel trough Guangzhou

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I usually don’t stay at fancy hotels as I see my business trips as a business trip, not a vacation. So I checked myself into the Lavande Hotel at an amazing rate of 60$/night. It’s right next to the Subway station so you can get to the Canton Fair very quickly. It’s not the greatest hotel and staff speaks poor English but you’ll get your room.

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Another foggy day in Guangzhou.
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One of the halls at the Canton Fair Phase 2

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Walking the floors.

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Could already use a bath after a day at the show 🙂

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You can literally find everything here.

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This might be a good camping product?

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Not sure if this prototype will make it into production 🙂

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Just one of the many many halls, full with suppliers…

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Baby products

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Heading back to the hotel

HKTDC 

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Beautiful covers and bags

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a nice kitchen gift set

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Is this my next coffee product? A drip – cold press coffee maker

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Heading to Hall 3

Globalsources 

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Mugs, mugs and mugs

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A DIY learning tool for kids

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gaming headsets

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Interesting cable organizer

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checking out gaming hardware

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iPhone lenses and covers

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Getting myself some new ties. Even though I never wear them 🙂

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Accessories, accessories and accessories

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Looking to create your own brand of shoes? This supplier works for Li Ning (the big Chinese brand) as well as New Balance (NB). I just love flyknit (see my orange Nike sneakers :))

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Gaming headset

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Time to do some sight seeing with a colleague


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Meeting up with Peter Zapf from GlobalSources

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Interesting Solar camping lantern

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High end headphones

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Silicone cooking pods

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Decorative copper items from India

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Kids travel luggage

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This bike weighs less than 10KG and costs over 800$

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My next PL product? 🙂

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Having a coffee break with Will and colleagues (Pete & Laura) from Uganda who are looking for their first products.

Yiwu

One thing I should mention is the wholesale market in Yiwu. 

Where is that? It’s a “small city” near Ningbo (Zheijang province) that houses “The World’s Largest Wholesale Market.” 

Here is a report from Business Insider. 

http://www.businessinsider.com/yiwu-china-largest-wholesale-market-2011-10?op=1#ixzz3V5meL6e8

I personally didn’t go but I have heard of a few people that came to HK that they went there before the shows. Is it worth it? Yes and No. If you have no contacts and there is no exhibition going on at the moment then YES. But if you are looking for serious suppliers with good quality and buying from factories directly then NO. The thing is that these showrooms and “suppliers” in Yiwu are thousands of trading companies mostly selling stock (with Chinese packaging and NO quality control) to you in small quantities. Yes you can give it a try and not all suppliers are bad but I personally had bad experience with suppliers there. It’s worth to see and there are a few nuggets and you can buy small quantities, just make sure to check out the supplier in-depth and have agreements and if possible inspections in place. 

Planning on coming to the shows later this year? Here are the dates for October:

http://www.globalsources.com/NEWS/SIC-trade-shows-in-hong-kong-guangzhou-october-2016.HTM?source=GSOLHP_Product_Guide

Interested in last years reports? Check out these links: 

https://importdojo.com/news-and-trends-from-the-exhibitions-in-asia/

Recap and conclusion for myself:

While I have met many amazing people, fellow Amazon sellers and suppliers this has also been a fruitful trip for me. Apart from making new friends and business partners I have also placed order for 4 new items that I found during those weeks and after initial research I can say that there won’t be any or limited competition. I have invested a total of close to 20,000$ into new products and I am expecting to get a return of 6-10,000 on each product after the first order. Once again, I can’t stress enough how important it is of actually coming to Asia to source your products. 

I hope that this update gave you a bit of an overview of whats happening in China/HK and if you have any questions please do not hesitate to contact me.

All the best and happy sourcing,

Manuel

https://importdojo.com/importdojo-masterclass/

How to import to the US for international sellers – ship to Amazon directly

Two of the questions I receive the most is: “Can I sell on Amazon US as an international seller” and “Can I send my order directly from the factory directly to Amazon?

Yes you can!

This prompted me to do a write up on the topic and without further ado, here’s a quick guide for you that hopefully answers your questions:
You basically have four options:

  1. Using a customs broker acting as the ultimate consignee (No EIN needed)
  2. Using a courier service like DHL/UPS/FedEx etc. (Amazon’s EIN recommended)
  3. Using a prepping and forwarding company that acts as the ultimate consignee (NO EIN needed)
  4. Using a forwarding company/customs broker when delivery by regular Air or Sea shipment (not by courier) and acting as the Importer of record and ultimate consignee yourself (Amazon’s EIN needed)

In all cases I still recommend you to get your own US Tax Payer Number or also commonly referred as EIN.

Simply follow this link for information and call the number mentioned under “Apply by Telephone – International Applicants”. It’s a very simple and straightforward process that takes about 10-15 minutes.

https://www.irs.gov/Businesses/Small-Businesses-&-Self-Employed/How-to-Apply-for-an-EIN

Some important reminders:

1) Not all customs brokers can act as the ultimate consignee. The ones that do usually offer services on top to act as your ultimate consignee:

2) Very Important: Never put Amazon as Importer of Record on any document. In case you send goods directly to Amazon only use them as the ultimate consignee but never as the Importer of Record otherwise they will definitely reject your shipment.

3) One thing that is super important if you decide to send products from China to Amazon without any stop in between (Prepping, Labelling or Quality Control company in the US):

HAVE AN INSPECTION. I can’t stress enough how important it is to have an inspection before sending anything to Amazon directly.

I know that many buyers have an inspection in the US. But what if the goods are defect to such an extent that you can’t rework them in the US? Are you going to send them back to China? Unlikely.

Save yourself this step and have the inspection in China with a reputable Inspection company like http://www.asiainspection.com

If there’s anything wrong during the inspections you can still have them re-worked in the factory directly.
On top of that you protect your initial deposit to the factory by having an inspection.

4) Also make sure you comply with Amazon’s packaging and labeling requirements (weights, labeling & carton measurements). Amazon’s fulfillment centers prefer palletised shipments but you do have an option to send the shipment un-palletised. There will be an option in Seller Central when you create your shipment that allows you to choose the option of un-palletised shipments.

 

 

 

5) Do as much labelling and prepping in the factory as possible!

Your factory can take care of all the labels and prepping needed for Amazon, you simply need to give them clear instructions when you place your order.

 

6) Think hard about “inventory placement” that lets you ship from China to one Amazon warehouse only.

This costs 0.3$ on top of the product cost but it might be worth it considering that you only have to invoice once. On top of that shipping companies charge extra for each set of documents on various levels and it is complicated to instruct your supplier to ship to 2-3 different warehouses. Think about all the labelling and coordination that has to be done with the supplier. However if you ship to multiple Amazon warehouses, have each order palletised for each warehouse while in China, so that you’re not using U.S. labor to de-consolidate a shipment and re-palletise goods.  You’ll also have to book the ground shipments after your ocean shipment has arrived, which adds complexity to the process

Lets look at each option in detail:

1) Using a customs broker acting as the ultimate consignee

There are several companies in the US that can act as your customs broker and ultimate consignee. If they offer to be a ultimate consignee they usually add a few services on top that they are looking to sell to you such as:

  • Clearing customs
  • Receiving cartons (LCL, LTL or UPS/DHL etc.)
  • Apply shipping labels
  • Ship to Amazon
  • etc.

This can add up in costs on top of your product but they’ll make sure that items are properly packed, labelled and cleared by customs as an ultimate consignee.

I’ve been contacted by http://www.westernoverseas.com a Third-Party Logistics (3PL)/Prepping/Customs Brokerage company based in the US and they had such a detailed process lay down in PDF that I decided to post them (with permission). Credit of the following content goes to Westernoverseas however please note the entire process is the same for other 3PL companies as well.

Why do I need a Customs Broker?

If your shipment is arriving by Regular Air Cargo (not by DHL, UPS, or FEDEX) or Ocean cargo, you will need a Customs Broker to clear the shipment on your behalf. All shipments must be cleared through Customs. Certain commodities are also subject to the regulations of other government agencies such as FDA, USDA, DOT and EPA. Please check with your Customs Broker for import requirements. Please do not ship without doing your research!

What type of Services does Western Overseas offer?

  • International Freight Forwarding (Shipping) – by Air and Sea
  • Customs Brokerage
  • Domestic Delivery from port to final US destination
  • Amazon FBA prepping
  • Warehousing

Should I use Ocean or Air Shipping?

Your decision should be based on how quickly you need your shipment and how much you’re willing to pay.

  • Ocean shipments are less expensive but take longer to arrive. The costs are generally 1/2 – 1/3 the costs to ship by air. You should figure approximately 3 – 4 weeks’ lead time.
  • Air shipments are more expensive but are faster to arrive. You should figure approximately 3 – 5 days’ lead time.

If I choose Western Overseas as a Customs Broker, how do I open an account? Is there a fee?

There are several forms that you must complete to set up an account. Please contact us at Ecommerce@westernoverseas.com. We do not charge a fee. However, we may charge for a consultation fee if extensive research on your product is necessary.

What is an EIN Number? Do I need one?

As a foreign importer, you do not need an EIN number for Customs Import purposes. You may need one as a seller on Amazon for State Tax purposes. Please check with Amazon and/or the Internal Revenue Service (IRS). You will be assigned an Importer Number by customs which will be used in lieu of an EIN Number for the purpose of the Customs declaration. You can be an importer without an EIN#. Customs will assign to you an Importer Number.

But you still need a Customs Broker and an Ultimate Consignee with an EIN#. If you use our FBA Prep Services, we will act as your Ultimate Consignee.
If you are U.S. based and are intending to import under a Corporation, then your EIN number will serve as your Importer Number. If you are U.S. based and are intending to import as a Sole Proprietor (e.g. John Doe dba ABC Importers), then your Social Security Number will be your Importer Number. If you are U.S. based and are intending to import as an Individual (e.g. John Allen Doe), then your Social Security Number will be your Importer Number.

What is a Customs Bond and what is the cost?

Customs requires that a bond be posted with every ISF and Customs Entry to ensure that all duties, taxes and fees owed to the federal government will be paid. An Annual Continuous Bond can be purchased for $500 (through Western Overseas) and it will cover both your ISF filings and Customs Entries. Having a Continuous Bond also reduces our ISF filing fee by $25. If you choose not to purchase a Continuous Bond, you have the option of purchasing Single Entry Bonds for ISF filings and Customs entries. This can become quite costly especially if your shipment value is high or is subject to other government regulations such as FDA. Furthermore, the bonding companies only allow a maximum of “5” Single Entry Bonds for ISF before the importer is required to purchase a Continuous Bond. You would be saving money in the long run. However, if you are planning to import only once, then a Single Entry Bond might be for you. Single Entry Bonds are subject to a $25 Bond Processing Fee. Our Bond costs are below:

  • ISF Bond: $75
  • Customs Single Entry Bond: $6.50 per $1000 of the shipment’s declared value + duties/taxes (minimum charge of $65). For OGA (other government agency – i.e. FDA, USDA) regulated commodities, the rate is $6.50 per $3000 of the shipment’s declared value + duties/taxes.
  • Customs Annual Bond: $500

What happens after I place an order with my supplier?

The process will depend on the terms of sale between you and your supplier. But the following steps are what typically occur for Regular Air and Ocean shipments. The below excludes shipments sent by Air Express Courier.

  • Production begins (seller might send you a sample for approval)
  • Determine if you will be using the services of an inspection intermediary service such as FBA Inspection, Earth Class Mail or Western Overseas.
  • Seller arranges the International Freight Forwarding if his cost includes this (CIF terms); if his cost does not include this, then you are responsible for arranging and paying for the freight.
  • Your supplier may have a couple of shipping companies to refer you to or you can obtain a quote from Western Overseas. If the latter, seller will provide you with the cargo details which you will pass onto the forwarder giving you the quote. You will also want to include the U.S. destination address – whether it’s Amazon FBA or the Intermediary Inspection service of your choice.
  • Hire a Customs Broker if separate from the Freight Forwarder.
  • Get ISF details to Customs Broker (ocean shipments only)
  • Shipment departs
  • Send copies of all shipping documents to Customs Broker
  • Shipment arrives
  • Customs clears
  • Our invoice is paid
  • Shipment is delivered or dispatched

It is your responsibility as an Amazon Seller and Importer to know Amazon’s FBA requirements.

What is Importer Security Filing (ISF)?

There are 10 key elements about a shipment that must be transmitted to Customs at least 24 hours prior to the vessel’s departure from origin through Importer Security Filing (ISF). This filing provides information to Customs regarding the impending import shipment. Your Customs Broker is the most ideal party to handle this transaction. If the filing is late, misfiled or not filed at all, then the importer will be penalized a minimum of $5,000 (max $10,000). Customs requires that all ocean import shipments have an ISF filing whether or not it is late. Otherwise, your shipment will not clear Customs. A late filing or non-filing of ISF also guarantees that Customs will examine your shipment.

What is a Harmonized Tariff Code (HTS)?

The Harmonized Commodity Description and Coding System (HS) is the mechanism by which international tariffs are standardized. If you ship items overseas, you are required to classify them according to the harmonized system. Each country has its own Harmonized Tariff Schedule (HTS).

The description and coding system of global tariffs is an internationally standardized system of names and numbers for classifying products. The first 6 digits of any HTS Code is (in theory) the same for any country. Beyond the six-digit level, individual countries sometimes have different rules for classification. Importers and Exporters the world over must classify all goods moved across international borders using the Harmonized System of the country of import. Every item you sell must be assigned an HTS Code according to the Customs tariff schedule of the country from which you are selling. Each HTS Code has an applicable duty rate. HTS Codes are sometimes referred to as HS Codes and Tariff Codes.

What is the time length for my shipment to be cleared by Customs?

We must allow Customs at least 48-72 hours to clear a shipment, although it could be less.

Why did Customs put a hold on my shipment? I have never had a problem with my DHL/UPS/FEDEX shipment before.

Please bear in mind that Air Express Shipments are treated differently by Customs. They simply move too many parcels on a daily basis for Customs to be able to monitor each one. And because Customs allows Air Express Couriers to clear an entire manifest under their own name and bond, it’s possible that your previous shipment may have just flown under the radar.

With regular Air and Ocean cargo, there is always the possibility of a Customs Exam which may cause a 3- 5 days delay in release. Any exam related charges will be the responsibility of the Importer of Record. Customs exams are generally random unless they have had a recurring problem with the manufacturer, the importer, and/or the commodity. That said, please ensure your product and its labeling comply with Customs laws prior to shipping.
What information do I need to provide Western Overseas to obtain a quote?

For a Customs Brokerage Quote:

  • A full description of the item(s) you are intending to import – i.e. General Description/Name of Product, Function, Material/Composition, Declared Value, Unit Value, & Country of Origin.

For a Freight/Shipping Quote:

  • Terms of Sale (i.e. FOB or Ex-Works)
  • Address of your Supplier
  • Port of Loading
  • Number of cartons
  • Dimensions of each carton
  • Weight of each carton
  • First U.S. Delivery address

For Amazon FBA Prepping Services Quote:

  • Total Number of Cartons and Units
  • A detailed scope of the services you require – i.e. Check for product and package damage, Apply FNSKU labels, Bundle, Insert Cards, etc.

What other fees should I expect?

If you using the International Freight Forwarding Services of another company, then you can expect charges due to their U.S. agent. Your shipment will not be released from custody until those charges are paid. Western Overseas can pay those charges on your behalf for a fee of 1.5% and include them on our final invoice. Other fees may include Customs Exam and related costs and Storage/Demurrage Fees.

Who should be listed as the Notify Party, Consignee, Ship To?
If we (Westernoverseas) are hired as your Customs Broker, we should always be listed as the Notify Party.

Western Overseas Corporation
510 Myrtle Ave. Ste 208
South San Francisco, CA 94080
Tel: (650) 952 – 2955
Email: Ecommerce@westernoverseas.com

If you are a U.S. based importer, the Consignee’s name and address will be your information. The Ship-to party will depend on who will be receiving your shipment immediately upon release from Customs.
If you are a foreign importer, the Consignee and Ship-to parties will depend on who will be receiving your shipment immediately upon release from Customs.

My supplier is asking for Shipping Marks. What are Shipping Marks?

Shipping Marks are printed on the outside of each Master Carton of your shipment. They should contain the information that will identify your cartons from cargo belonging to others. The suggested marks would be:

  • Your Company Name
  • Carton Count – e.g. Carton 1 of 10, Carton 2 of 10, etc.
  • General Description of item
  • Country of Origin
  • Any special handling instructions – e.g. This side up, Handle with Care, Fragile, etc.

What shipping documents do I need to provide to Western Overseas (or other 3PL)?

  • ISF Details (for Ocean shipments only; we must receive this at least 72 hours prior to the vessel’s departure from origin)
  • Ocean Bill of Lading or Air Waybill
  • Commercial Invoice
  • Packing List
  • The above documents are obtained from your supplier. If you use our Int’l Freight Forwarding services, then our overseas agent will supply us with the ISF details and the Ocean Bill of Lading.

When do I pay Western Overseas ((or other 3PL) and what type of payment is accepted?

Payment for an Annual Customs Bond will be due upon receipt. Payment for Customs Brokerage services including duties/taxes, delivery, freight, etc. will not be due until your shipment has cleared from Customs and is ready to be delivered or dispatched.

We accept the following payments:

  • Credit Card (Visa, MasterCard, American Express)*
  • Wire Transfer**
  • PayPal*

*subject to a processing fee

**full invoice amount is due without any deduction of your bank’s wiring fee
June 2015

—End of content from Westernoverseas—

 

 

If you are interested in their fees and other services here’s the contact information:

Susan Park
Business Development Specialist
Western Overseas Corporation
11605 Pike St.
Santa Fe Springs, CA 90670
Tel: (562) 985-0616 x5069
Direct: (714) 243-5069
Fax: (562) 364-7798
Email: Susanp@westernoverseas.com
Website: www.westernoverseas.com

2) Using a courier service like DHL, UPS, FedEx etc. (EIN recommended)

 

Air Express Courier shipments sent via DHL, FEDEX, or UPS are different. Customs has special regulations for them where they are allowed to clear entire mass quantities of shipments under their own name and Customs bond. They simply move too many parcels for Customs to be able to clear every single one. Therefore, they are authorized to clear shipments that are on one cargo manifest of low-risk up to values of their own discretion. They also won’t ask you to apply for a customs bond or filling an ISF. They provide a one-stop solution and are therefore more expensive than forwarding or logistics companies/customs brokers.

You simply be the Importer of Record with your foreign address or you can subscribe to services like http://www.usamail1.com/ to get an US address (not obligatory) and apply for an EIN here (obligatory if you want to be the ultimate consignee): https://www.irs.gov/Businesses/Small-Businesses-&-Self-Employed/How-to-Apply-for-an-EIN

 

3) Using a prepping and forwarding company that acts as the ultimate consignee (NO EIN needed)

 

There are several services around that receive your goods (where you act as the Importer of Record) after cleared by customs. For example if you send in your order by courier (DHL etc.) and then want them prepped, labeled etc. you can use prepping companies that can also act as your ultimate consignee. These guys are similar like the first example but usually don’t clear customs for you. You can act as the Importer of Record with a foreign address and will be assigned an Importer Number by customs. Once the prepping, labeling etc. is done these service provides will send in the order for you to Amazon.

4) Using a forwarding company/customs broker and acting as the Importer of Record yourself (Amazon’s EIN needed)

 

If you send items by Air or Sea the regular way (meaning no courier like DHL, UPS etc.) you will need a forwarding or also referred to as Third party logistics company (3PL) that can act as both the forwarder as well as the customs broker HOWEVER not as the ultimate consignee.

In this case you will be the Importer of Record and Amazon will be the Ultimate consignee. You don’t need an address or bank account in the US but you will need an EIN number of the ultimate consignee or Importer of Record. You can contact Amazon for this information but your Customs Broker should be able to obtain this information for you.

I also heard that sometimes Amazon refuses your goods if you don’t provide your own EIN but I haven’t found anything to the contrary.

You simply be the Importer of Record with your foreign address or you can subscribe to services like http://www.usamail1.com/ to get an US address (not obligatory) and apply for an EIN here (obligatory if you want to be the ultimate consignee): https://www.irs.gov/Businesses/Small-Businesses-&-Self-Employed/How-to-Apply-for-an-EIN

 

 

There’s one more option. If you know someone in the US who is willing to receive your order as the Importer of Record providing his EIN number you can go that way too. But I recommend you pay all fees upfront so your friend/acquaintance doesn’t have to bear them.

Miscellaneous:

I do recommend you to apply for an EIN for general tax reasons and to comply with IRS regulations. Amazon can track your sales tax back with you and your country of origin.

If you want to learn more about the process and import from China professionally please check out our ImportDojo Masterclass here:
https://importdojo.com/importdojo-masterclass/

I will be adding over 20 hours of new material to the class in February 2016 increasing the price in the process, so act soon.

Hope this helps and if you found this article helpful please share below trough social media 🙂
All the best and happy sourcing,
Manuel

News and trends from the exhibitions in Asia (October 2015)

It’s been a while since my last post and it’s time to give you guys an update. 

October is the busiest time of the year for me. In October there are usually somewhere between 10-15 exhibitions that I need to attend or that my buyers attend. 

This month I had a total of 26 buyers from 14 countries visiting me and the exhibitions. Here are some of the major exhibitions that were going on in and around Hong Kong: 

  • Global Sources Electronics (11-14th of October) 
  • Global Sources Consumer Electronics (18-21st of October) 
  • Global Sources Gifts and Premium (18-21st of October) 
  • Global Sources Fashion, Accessories & Textiles (27-30th of October)
  • HKTDC Electronics Fair (13-16th of October) 
  • HKTDC Lighting Fair (27-30th of October) 
  • Megashow Toys, Kitchen & Dining  Phase 1 (20-23rd of October) 
  • Megashow Gifts, Houseware &  Premium Phase 2 (27-29th of October) 
  • Canton Fair Phase 1 (15-19th of October) 
  • Canton Fair Phase 2 (23-27th of October) 
  • Canton Fair Phase 3 (31 Oct – 4th of November) 

These were some of the exhibitions that I usually attend but there are a couple more. Feel free to check out schedules for next year here: 

http://m.cantonfair.org.cn/m/en/index.aspx

http://www.globalsources.com/TRADESHOW/TRADESHOW.HTM?source=GSOLHP_TopNav_TS

http://www.mega-show.com/

http://www.hktdc.com/en-buyer/

The biggest of them all is obviously the Canton Fair in Guangzhou spanning over 3 1/2 weeks and 3 phases attracting over 200,000 buyers within this time frame. For me these exhibitions are essential in finding new suppliers and products and meeting up with clients and buyers. It is also a great time to network with fellow Amazon sellers and importers. 

I was lucky to meet with a fellow ImportDojo member, a couple Million$ Amazon sellers (Will Tjernlund & Reed Thompson) as well as attending a meet-up organised by Junglescout’s creator Greg Mercer in Guangzhou.

Without further ado, here are some highlights and moments from my last 4 weeks:

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Beautiful day in Hong Kong, heading to the Gloabl Sources Electronics at the Asia World Expo. 

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Making my way to the expo hall at the Asia World Expo building at the Airport. GlobalSources offers a free Airport Express train ticket to and from the city (12$ value) on each day you attend so make sure to get your free ticket at the entrance of the Airport express.  

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Two different expos were held that day. Gifts & Home / Mobile Electronics.  Notice the “Free sourcing service for buyers”? If you feel lost and need a little help with finding products drop in and ask for help. 

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Making my way to the mobile electronics hall. All I see are smartphones and smartwatches in the first few booths. 

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Tablets and smartphones everywhere. 

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Smartwatches. Not sure these still sell well. I have first seen them in 2013 and sales has significantly decreased I reckon. My suppliers have sent updated offers for these watches every three weeks. From the highest price in 2013 of approx .49$, they now cost somewhere between 11$ – 15$. 

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These “hooverboards” were the most seen product at any exhibition. It seemed that every supplier offered them even if they sold completely unrelated products in their booth. My advice, stay away. Many of them have issues with the batteries and lifetime after a few weeks. 


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IP cameras & smartwatches again. Every booth had them. 

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Remember this Kickstarter that raised over 800,000US$? This is the supplier and they offered me a price 72-80$ depending on the quantity (Kickstarter price was 85-119$). The MOQ (1000) was pretty high but they are trying to find distributors for exclusive deals. I am pretty sure that they will soon be copied by suppliers who can offer half the price. The helmet itself is pretty cool, you can listen to music, flash left/right on the helmet and a lot more all via remote control/bluetooth and an app. 


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Built in speakers in the helmet. 

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Different functions displayed. 

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Remote control mounted on the bike. 

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IP cameras again.

IMG_6611

Remember I mentioned in April that I only saw one supplier for Virtual Reality headset and you should watch out for this category? I saw at least 10 suppliers this time and this category is getting really big. 

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Here we go again, “Hooverboards”.

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Drones were still a big topic but only the professional suppliers have survived. 

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Remember the Indiegogo crowdfunding project for levitating bluetooth speakers? This is a poor copy. 

IMG_6627

Lucky to meet up with Reed Thompson & Will Tjernlund, the Multi Million Dollar FBA sellers. I had to listen to what they were up to that same night over a beer. 

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There were all kind of “segways and hooverboards” and they even had a “little park” to try them out. 

IMG_6633

I then went to the Gifts part and I found these neat Gentlemens sets. 

IMG_6636

Considering to private label this item. Thoughts?

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A bit of walking around in Central Hong Kong. 

IMG_6703

I was invited to a wedding which was pretty cool because it was hosted on one of Hong Kong’s famous Star Ferries that cruises trough Hong Kong harbour.

IMG_6764

It was time to head to China for the Canton Fair Phase 2 and I booked myself into the Landmark Canton. Prices are reasonable (120$/night) but the hotel has degraded over the years. 

IMG_6765

There are several ways to go the to the Canton Fair from HK, I prefer the trough train from HK to Guangzhou for around 30$. 

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Be sure to check if your hotel has free shuttle busses from the hotel to the exhibition grounds. I didn’t use them as I was a little late and would have to wait. These buses are usually in front of the hotel and they run every 30 mins or so (free of charge). 

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Arriving at the Canton Fair Phase 2. This phase featured several categories: Kitchen & Tableware, Gardening, Pet products, Food, Furnitures, Ceramics, Gifts & Premium, Decorative items, Toys, Personal Care, Toiletries, Household items and more. 

IMG_6773

Making my way into the first hall (furnitures) 

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In the back of the halls the booth’s get smaller and usually host small factories BUT they often have better prices than the big name companies. Make sure to ask around for prices. 

IMG_6780

Toiletries bags disguised as small suitcases as you would get them on some airlines in business class. Neat idea as a gift. 

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Car charging pods for smartphones and tablets. 

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Your car audio system doesn’t have Bluetooth? Never-mind, get these 12V cigarette plug bluetooth speakers. 

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Tablet and smartphone charging station.

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Home automation was a big thing again and many suppliers had well working systems this time including a ready to download application. 

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Seen these on your friends smartphone? Starting from 1.5$. 

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These were not new but are a great gift idea. Watch out for suppliers that have at least FDA certification (as in this case) 

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Decorative items at extremely low prices. 

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A variety of pet items at this supplier. A great category for starters. 

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Travel cases and gift boxes with very nice designs. 

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Tumblers and PET bottles. 

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Christmas/Festivity lighting and Halloween products. 

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Jewellery 

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Handicraft items

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A view at the halls. 

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The view from hall C to hall A. Hall A was built in 2005 and there are now 3 halls with the same size. They are all full with exhibitiors.

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Storage containers

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A view towards the city from the exhibition grounds. The pollution is clearly visible. 

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Time for Chinese seafood dinner 

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I teamed up with fellow ImportDojo member Omar on the second day of the exhibition. 

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Registering the Canton Fair badge for Omar. A pretty fast and simple process if you pre-register online. Be reminded to keep the badge. It is valid for all future Canton Fair shows. 

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Interesting travel pillow that keeps your neck straight when you sleep.

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This BBQ apron had all sorts of pockets and even a beer opener included. 

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“Dog-clothes”

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Pottery and garden fountains

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Artificial plants and garden decoration

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Omar keen on trying the “hooverboard” that was again at nearly every  booth here. 

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Tumblers and bottles

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When sourcing household & kitchen products look out for suppliers that have proper certification (FDA, CE or others) 

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Interesting coffee maker. Nothing new but a very nice design in copper. 

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Another Chinese dinner in Guangzhou with fellow German Amazon sellers. 

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I needed a day off after all the hectic weeks and decided to go for a stream hike in the jungles of Hong Kong. 

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Can you believe this is in Hong Kong?


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I couldn’t make it to the lighting fair in Hong Kong but a friend took a few impressions

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Contemporary lighting

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Modern lighting

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Time to head to the Canton Fair Phase 3. This phase hosts the following products: Sports and casual wear, mens & women’s clothing, kids wear, underwear, office supplies, sports/travel and recreation products, shoes, bags, health products, home textiles and much more. 

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Amazing Junglescout meetup in Guangzhou with fellow FBA/Amazon sellers!

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Ready for Phase 3, I opted for uncomfortable leather shoes as usual 🙂

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No matter which hall, nearly every booth had function/active wear in the trendiest designs. MOQ’s ranged from 300-3000 pieces. 

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Swimwear

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Kids, diving and bicycle gear

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These knitting shoes look very familiar (ahem Nike?) 

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Gym time anyone? 

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The sports/travel & recreation products hall was the most interesting in my point of view. 

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 Foosball kickers

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Titanium camping gear

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This e-bike was not comfortable to sit on

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Blow-up whirlpool

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A view of the city

There were a lot more pictures and expos that I went to but it would be too much to post here.

If you are selling or planning on selling on Amazon within the next year I highly recommend that you make your way to China. ImportDojo offers you training and expertise preparing you for these exhibitions here: https://importdojo.com/importdojo-masterclass/

Also feel free to join Importdojo’s Facebook group and keep updated for next year’s exhibitions and meet ups. I am organising a buying trip in 3 groups during April 2016 with a maximum of 4 people per group and if you are interested to learn more feel free to message me.

I hope you got a bit of insight into the exhibitions in and around Hong Kong and I look forward to your comments 🙂

Happy sourcing everyone!

Manuel

The Cantonfair – All you need to know about the biggest expo in Asia

The Cantonfair is coming up and I thought I’d give you guys an insight on the exhibition, how you can prepare, what you can find there and who it isn’t for.

I first went to the Canton Fair in 2005 and things have certainly changed since then. There were literally not many places to eat, find an ATM or book hotels around the area.
China and the Cantonfair have seen the potential and improved the general experience a great deal since then. I can only imagine how it was 20 years ago.

Some general information first:

The Canton Fair is the holy grail of exhibitions. This event is so large that it is held twice a year and each time runs over a span of 3 weeks in three different phases. Each phase comes with different product categories.
As of 2014 there were over 22,000 exhibitors. This exhibition is a must for me and it should be for you too. You will find a lot of suppliers, big brands, small factories, or the product you have been looking for for so long.
Plan at least 2, or better 3, days for your product category/phase. Sign up once and get a badge that will be valid forever.

Insider tip: Don’t throw away your badge. You can use it for your next visit without paying 100 Yuan for a replacement card.

How to register?

Most exhibitions require you to pre-register if you want to get in for free. Registration on-site is also possible but usually there will be a fee of 10-20USD. You will need to provide a name card for your registration.
When you pre-register online, just fill in your company’s details and print out the confirmation. Bring that confirmation and you will be handed a badge for entry.
The Canton Fair has the same procedure, however you can keep your badge for years to come. If you lose your badge you will have to pay a fee of 200RMB for re-issuance.
There is a first time registration fee of 100RMB. If you have a supplier who can invite you, you don’t need to pay any fees. Also remember to bring along a passport photograph for the application (required).
You can register here, among many other useful tools for the Canton Fair:
http://invitation.cantonfair.org.cn/Home/Index
Remember to keep the badge for the Canton Fair, as it is valid for years to come.

Know your goals

Remember you don’t have all day. I usually try to finish an exhibition within 1 day (except the Canton Fair). But this is also because I know how to spot the good from the bad ones and know which questions to ask. As a first timer I recommend you take some more time but don’t try to spend more than 20 minutes per booth with each supplier.
If you spot some item that really catches your attention and you would like to discuss further steps with the supplier right away, take your time. It is likely you will have 2-3 meetings that can take an hour.

Price preparation

You will likely be looking for a category of a product so you should prepare yourself with some basic prices that you have received from suppliers beforehand. Knowing your prices is essential before going to an exhibition.
If you are looking at new products and are not aware of prices try my “rule of thumb” calculation of 30%, adding this to your margin and calculating your selling price. You will quickly figure out if the price the supplier gave you at the booth is realistic or not.

Prioritizing

The Cantonfair is enormous in size. Grab a map at the entrance or the information counter of the exhibition and take a moment to study the areas of interest. You can also look online prior to going to the exhibitions at which hall or category is where to save some time.
Once it is clear where your suppliers are situated, start there. Go through each hall in an organized way and prioritize the halls by importance.
Once you completed all the halls you wanted to see you could go to the halls that were initially of the least interest to your business. You may find some ideas on other products in less interesting halls too.

Hotels during the exhibition:

Many hotels will provide a free shuttle bus to exhibitions. Check with the hotel staff to see if this service is provided.
Book hotels now if you haven’t booked them yet! Hotels during exhibitions can get very expensive. The sooner you book the better.
I usually won’t stay too far from the exhibition area, as I don’t want to waste time. Unfortunately that carries a price tag.
If your budget doesn’t allow this, find a hotel near a subway station (MTR).
Whatever you do, don’t take a taxi TO and FROM the exhibition. Take the subway or free shuttle buses provided by your hotel. At the Canton Fair, for example, it is impossible to get taxis at night. You can take a taxi in the morning TO the fair; that should be ok.

First things first. Here is what I bring to exhibitions:

• Name/Business cards (an absolute MUST)
• Trolley to carry all the catalogues that I collect
• My own (printed) company presentation
• Notebook & pens
• Passport photo (some exhibitions such as the Canton fair require a passport photo)
• Comfortable shoes (you will be walking all day)

At the exhibition:

Once you are at the exhibition, get a map; you should be able to get them anywhere at information counters.
Walk the aisles until you find something that interest you is definitely an approach but I prefer to prepare a little and do some research on my main interests.
You will want to work with manufacturers only at the exhibition and not with representatives. There are hundreds of representatives at the fair ground offering translation services, negotiation, insight etc. Do not go with them! They usually charge very high fees and aren’t totally honest with you. They are probably also no experts in every product category and that might end up in a disaster.
Never place orders right away. You should negotiate prices, ask questions and maybe show more than interest and tell the supplier that you may want to order when you are back. But don’t tell them to enthusiastically that you want to order right away. Why?

  • The prices you get at the fairs are usually not the best prices. Negotiate when you are back home.
  • You will want to clarify your terms first via email/phone calls before you place an order. Have him sign a purchase order agreement.
  • You will want to compare prices of more than one supplier for the same product

To determine if the person you are speaking to is a manufacturer or representative make sure to ask a lot of questions:

How to act and ask questions at exhibitions

I usually prepare a little speech before I go to the exhibition. It depends on my project or product that I am looking for but I like to introduce myself a little bit and give the supplier a professional image of me.
He is likely more interested in giving me answers, good prices or proper email feedback after the exhibition. Here is how it could look:

Hi, I am Manuel and I am the Managing Director of Mandarin-Gear Limited in Hong Kong.
I manage/own a sourcing and buying office for many large retailers worldwide.
My customers are looking for product “X” and I am interested in discussing more details or receiving a quotation based on my customer’s requirements.

Then I ask my questions and once I am satisfied I will ask him to provide me a quote based on my requirements. I will hand him my business card and I will MAKE SURE that he wrote down everything we discussed.

Could you please send me a quote of this item (from his booth) based on “X” quantity, including certification “XY”?

I will also take his name card and catalogue to study later.
Here are some questions that I ask the suppliers. You can adapt these to your product or requirements as necessary. You can also make yourself a checklist with these questions and print it out for each supplier meeting you have.
Obviously you can also memorize these questions and make notes on your notepad.
Clip the supplier’s name card to your notebook and write down answers to these questions:
• When was his factory established?
This is important as to figure out if he has been doing business for a long time or if he is newly established. If the factory is brand new I will be wary of dealing with them, while if they are older than 5 years I will probably go ahead with further questions.
• What is the total count of staff, workers, engineers and managers?
A well-organized factory has at least 200 employees. That could be 160 workers, 30 sales staff, 10 engineers and 10 managers.
• What certifications can he provide for product “X”?
Know the certifications that you need for your product. If a supplier has no idea about FCC, CE, RoHS, ERP, GS or other certifications of a chemical or other nature, you can probably leave the booth right away. If he is aware of the certifications and requirements but hasn’t applied them to all his products it’s not an eliminating criteria, but make sure to ask if he is willing to apply for the certifications after order-placement.
• Who are his main customers?
Do you know the customers he is talking about? Do they have a certain reputation in your country that would make you feel comfortable working with him? If he is working with customers that you know, it should be a good sign of his competence.

• Mention a few of your competitors or bigger clients
Drop a few names of the bigger competitors or clients of yours. If he knows them it’s a good sign. If not, it is very unlikely that they are doing overseas business and perhaps aren’t even interested in your business, knowing that your requirements are too high or “too much work” for him.
• What is his main market?
If he operates already within or near your country it is also likely that he can fulfill your requirements. It’s usually a good sign if he works for countries like the UK, Germany, Switzerland, Sweden, the United States, Canada and other first world countries. It means that his factory is able to pass audits, tests and certifications needed for these countries.

• What is the factory quality management standard?
Remember that good factories are also easy to spot if they have a certain quality management System (QMS) such as ISO 9001, BSCI and so on.
• What is the MOQ?
Can he actually provide the low or high MOQ that you need? Is he willing to produce a first order based on a very small quantity or does he have the capacity for large volumes?
• What is the rough price of this item based on X quantity?
Most suppliers will give you a very rough figure for the product they are exhibiting. These can be vague as often these are “blank” prices that do not include any certification, licenses, etc. But it is necessary to ask for prices (and write them down in your notebook) for your follow up. You can also use my “rule of thumb” to add on 20-30% on top of the supplier’s price to calculate if the price is competitive.
• What certification is included in his price?
Does the product currently fulfill your minimum requirements for certifications or standards? If not, is he willing to apply for certifications after order placement? Is he aware of the different certifications that you need or do you get the feeling he doesn’t know what you are talking about?
• Ask if he can provide samples after the exhibition
If you would like to have a sample after you come back home ask him if he is willing to send samples. Most likely he will agree but make sure you remind him once you are back home to send you the sample. Some suppliers will actually sell or give you a sample right on the booth if you ask for it. It is actually not allowed but if there is a sample I would need right away because it’s that good and I want to show it to customers back home, I will ask anyway.
• Ask for payment terms
Are his payment terms a K.O. criteria? Make sure he agrees to your payment terms and doesn’t insist on 100% payment upfront.
• Ask for his top-selling items and who his customers are
Sometimes you may not have time to look at all products so you might miss the best selling items. Ask him either to show you his best selling items or send you a quote later for his top-sellers. Make a note that you are expecting his prices and offers later.
If I get the feeling after 1 or 2 questions that a supplier has no idea what I am talking or asking about, I politely end the conversation and leave the booth. There is no use in screening a supplier with all questions when I already know he is not interested or can’t fulfill my requirements.
After all, I need to scan the entire exhibition and I can’t waste my time with suppliers that are ignorant or need a basic education on my market’s/customer’s requirements. You will develop a gut feeling pretty soon if it is worth it to speak to a supplier longer or if you should leave the booth right away.

Hall arrangement:

Once you arrive you need to pass trough the registration area which is pointed out through signs. Don’t forget to pre-register trough the link I gave you and bring 2 passport photos. At the registration area you will have to line up for “pre-registered buyers”. You will be guided trough the process by the staff there and then get your entry badge. You can then move to the main halls.
There are 3 main areas on each phase:
http://www.cantonfair.org.cn/hall/en/index.aspx?start=bn
Once you choose your phase you can hover over the hall and see what products you will find in these halls. Within the 3 main areas (A,B,C) you have numbered halls as for example 6.1. (ceramics). Within this hall you have over 200 suppliers!

Depending on your priority products I recommend you start with the most important halls first.
During the registration you will also get a printed guide with all hall details that helps you to navigate. But you can already write down the main halls now when you look at the link above.

At the Entrance of each hall:

Look at the main halls you want to see and prepare to walk them trough in order. It is your first time to visit the fair so I am guessing you have no appointments with suppliers. Therefore I recommend you just start walking until you see something of interest. That could either be a product that you have on your agenda or an item that really pops out.

In the halls/at the booth:

Suppliers will either be eager to give out brochures of their products or you simply walk into the booth of this supplier if there is anything of interest for you. Unlike in the US or at European exhibitions, the suppliers are very open and welcoming in receiving you in their booths. No appointments are required. Just walk in and introduce yourself and what you do or what you are looking for. You don’t need to hand out any business cards at this point since you don’t want to be spammed later from suppliers that do not interest you anyway.
If you see anything of interest within the booth point to these products and start asking the questions I mentioned above:

If you are happy with the discussed (make sure they also take notes) hand over your business card and tell them to email you all the details. Nice touch with the “thank you in Chinese” on the back by the way
Take a catalogue or a brochure from the supplier as well, have him staple his business card on it and note down what is important to you. Try to get catalogues from each supplier that you visit. They will be happy to give you a catalogue in exchange of your business card.
You will quickly see which booths you should walk in. The goal is to find manufactures or good trading companies.
For example avoid booths that have only a few products in the shelves (A) or booths that have too many different kind of product categories (B). Go for booths that have maybe 3-4 product categories but seem to be specialised on each category (C).

 

A: Few products only indicate a small trading company with high margins and no real expertise and little value
B: Say you see a booth that has all these products inside: towels, pet supplies, electronics, ceramics etc. It’s a clear sign that this supplier trades everything and anything. They may have expertise in certain areas but their prices are high.
C: A booth that has 3-4 product categories. For example a booth that has: bathroom accessories, shower cabinets & faucets. They all relate to each other and thats a good sign for a real manufacturer. Try to focus on these.

Miscellaneous:

Food: There are a few western restaurants and coffee shops on every corner
Money: There are a lot of ATM’s everywhere in case you need to withdraw money.
Printing services: Printers and business centres everywhere available.
WiFI: Is available for free. Just ask for the log-in at the info centres.
Hotels & ticketing: Travel agents are available on several main levels to book flights, train tickets or hotels
Bus: There are buses leaving to major hotels during peak hours (9am 5pm) for free. Major hotels also arrange buses TO the exhibition. Check with your hotel.
Taxis: Taxis are a nightmare to get. You can take a taxi to the exhibition in the morning from your hotel but in the late afternoon you can sometimes wait up to 2 hours to get a taxi. There are illegal taxis everywhere but they charge 10 times the price. I recommend to take the hotel bus or the Subway.
Subways: There are 2 subway stations at the exhibition grounds. One at the beginning & one at the end. I usually take the Subway as it is the most convenient way to get back to the hotel. When booking your hotel see to book one close by a subway station.
I hope this gave you a bit of an overview and I wish you all the success at your trip during the Cantonfair 🙂
Happy sourcing guys!

Chinese Sellers on Amazon? Don’t worry (for now)

So I am pretty sure everyone read the news that Amazon is helping Chinese factories to get their brands listed on Amazon. It’s actually old news as the Amazon team has been on the grounds in China for a few years now.
Everyone is worried now which is understandable. One thing they definitely have advantage in is the price, but let me explain why that doesn’t matter.
Let me take off some of your worries right now and explain why this will not impact your Amazon business in a short time period and how you can prepare to be ahead of the Chinese sellers.

Minimum Order Quantities (MOQ’s)
Most factories have high MOQ’s and thats often because they need to purchase a certain amount of raw material from their sub-supplier. To do so they need orders. Bringing me to the next and most important topic, taking risks.

Taking Risks
Many factories won’t take the risk of producing for their own stock and try to sell it trough some sort of sales-channel. They do in some cases, but these items are mostly found on Chinese websites and Aliexpress or DHGate.com
When they sell on these sites, the packaging you get is probably in Chinese, as is the instruction manual.
A factory does not produce on their own risk and try to sell it somewhere. They always need a customer behind an order. Be it a large retailer, a small time buyer from the Philippines or the occasional Amazon buyer.
They don’t have stock of the necessary raw material or packaging because the longer they store it, it will get smudged, dirty and might not be possible to sell it anymore. I know this because I have been to 100’s of factories in my time in China here.
When you go to a factory you won’t find their own packaging or raw material on stock. They ALWAYS purchase the material once they have an order incoming.

It’s just not economical for the factory to purchase raw material on their own behalf. Margins are so low these days, they need to maintain cash flow for their customers. Sometimes they have some stock but that’s probably from a over-production or from a client who didn’t take the entire quantity. Sure some factories have good cash flow, design & marketing departments and they will sell on Amazon. Those are the ones that you can see now already. But they do not posses the knowledge on how to SUCCESSFULLY sell on Amazon (yet). I don’t know anyone in China who has taken a course on Amazon selling or listening to podcasts on how to be successful on Amazon. And most factories in China just won’t take the risk of investing money into their own product to sell it online overseas.

It is not within the Chinese culture that you take a risk for something that you don’t know is going to pay off. Chinese won’t create a listing on AMZ without knowing that their product will sell.
They always go after the sure thing (there are exceptions of course).

Quality standards
When a factory develops a new item and they get their first order for it it is likely a “naked” item with no standard whatsoever. The factory needs to rely on each customer’s input on what the customers needs in terms of quality.
A small importer in Thailand has completely different quality requirements than a large German retailer. The importer in Thailand may require nothing, while the retailer in Germany has all sorts of requirements that involves large investments on the suppliers side. Who do you think the supplier will rather want to work with? Exacly, the Thai importer. Because his quality requirements are low and not much effort is needed to sell the product. So many factories do not have the necessary quality standard on new products. Amazon is heavily investigating into products that do not meet current American quality standards and if your product does not comply it gets removed. There are of course established factories who have meet all necessary quality standards but they are likely comfortable selling to their existing customers.

Certification & Requirements
I often hear from suppliers when I ask for a certification of a certain product: “you don’t need that, other customers don’t ask and we don’t have it”.
Well excuse me but I will decide what my market and selling channel needs in terms of quality & certification. Amazon is cracking down on many sellers who don’t have proper certification for their product or in most cases they won’t even allow sellers to list products without certain certifications or test reports. After all Amazon cannot afford to be sued by a customer who for example bought a plastic product that comes in touch with the skin and now the clients has a rash because the plastic is made out of waste material and has high toxins and chemicals in it.

Innovative and trendy
I have yet to walk into a showroom of a factory and see something new apart from the occasional exception at an established factory with retailers or customers in the West. That is after living and working here for over 10 years. There are of course suppliers that develop their own products but in many cases they miss the product to market fit. They always rely on the input of a customer on how a design of a product or the functionality has to be. I read a report a few weeks ago that quoted Former Hewlett-Packard CEO Carly Fiorina:

“I have been doing business in China for decades, and I will tell you that yeah, the Chinese can take a test, but what they can’t do is innovate,” she said. “They are not terribly imaginative. They’re not entrepreneurial, they don’t innovate, that is why they are stealing our intellectual property.”She added teaching innovation, risk-taking, and imagination “are things that are distinctly American and we can’t lose them.”

The quote caused some outrage around China but the majority of Chinese people actually agreed with Carly Florina and posted on Chinese forums like Weibo (largest forum in China). Saying they need to be more innovative and take more risks sometimes. They weren’t offended and I think she didn’t want to offend them, but she did point out the weakness where they have to improve. And that cements my earlier statement “ taking risks” is simply not in their nature.

Customer Service
I doubt that Chinese sellers can manage the customer service from China. They would need to hire perfect English speakers and dispatch them completely to their Amazon business.
I can tell you that if I ask my suppliers to do so they will probably ignore me. It is considered an investment “not worth it”. At least as of today.

Marketing Strategies
It is very unlikely that a factory knows much about launching and promoting a product trough blogs, landing pages, Facebook promotions (Facebook is banned in China), review groups and so on that many of you have paid good $ amounts to learn.
But these are the channels that a new product needs when it launches or when it needs to grow. Otherwise your product just drowns amongst the competition and never lifts off to be in the top sellers.

Price Point
Yes, they do have advantage over the price. But that is not the key issue when you sell on Amazon. When a supplier quotes you a price of 5$ his own profit will probably be less than a $. And that doesn’t really give him an edge, because YOU (the experienced AMZ seller) has years of experience, PPC knowledge, Facebook followers, mailing lists, existing products with reviews & social proof etc. that the customer is willing to pay for when making a buying decision.

Legal Issues & Company Setup
It is not very easy to set up a company in the States for a Chinese company. To be really successful on Amazon you need a private label, have a trademark registered and a company set up.
Not many sellers from overseas will go trough this process.

Facebook pages
Facebook is banned in China. Sure they can get a VPN connection and go on Facebook but who are they going to promote to?
Build a Facebook audience with zero friends and followers? That is going to take a long time. Are they going to post on Facebook groups like The Amazing Seller or ImporDojo to post their products?
No. The last time a chinese seller promoted his product in my group I banned him. Not because his product wasn’t interesting or I don’t allow it but the way he did was pure spamming. Joined the group, no interaction at all, no feedback to other group members, simply wanting to promote his product to the group members without providing any real value to the group. So you can take one of the most important promotional tools for your new product (Facebook) already out of the equation.

Branding & Packaging
When I set up my own company (www.mandarin-gear.com) in late 2013 I had one goal. Affordable products at a great quality with excellent packaging.
What Chinese lack at this moment is an eye for design and western preferences when it comes to packaging. They also do not have properly translated instruction manuals on their own.
Sometimes they use their customers proof-read instruction manual when they sell to other customers but for new items they don’t have anything. Imagine what Amazon customers think when they open the box and can’t understand half of what’s written in there? How do you think that will affect the review? That’s why, whenever you buy a product in China always try to have a proper instruction manual. Check out my other post on this: https://importdojo.com/private-labels-packaging-differences/

English language barrier
Have you ever been on a Chinese website with English version? Yes? So you have seen the horrible grammar mistakes. This won’t change when Chinese sellers list on Amazon. Yes, they can now list their products trough a Chinese Seller Central account and it’s all in Chinese but that doesn’t change the fact that you need proper keywords and wording with excellent grammar when you want to list & sell your product successfully.
Suppliers simply wont be investing their money into proper English translation because they don’t believe in going the extra mile without knowing they will make a profit; so their listings will look horrible.
Would you buy a product when you don’t understand half of the text or description?

But they already sell successfully on Ebay and provide free shipping?
Yes, the Chinese sellers have taken on Ebay a few years ago and some are very successful. But only successful in terms of their sales and because the Chinese Government heavily subsizdes freight costs from China (China Mail).
I would say 20-30% of the items sold on Ebay from Chinese sellers are returned or the customers are unhappy with their purchase because of the quality of the product.

You can’t refund the item to the seller, you won’t send the item back to China, will you?
And even if you can, are you going to leave a positive review?
Amazon doesn’t work like that and everyone has to pay the local shpping costs in the US. So while the Chinese seller can send in his product at a cheap rate he still has to pay the local freight costs. And what stops you from getting good shipping rates from China? Most suppliers will offer you the same rates they get when sending goods overseas.
Also you can’t just list everything you want (there are restricted categories and legal compliances to be met) and whenever there are returns the clients will leave a negative review.

Amazon won’t hesitate to ban the sellers account immediately if the return rates are as high as 20-30%. Amazon has a strict policy when it comes to customers satisfaction and the way I see it not many Chinese factories can comply with their “basic” product on Amazon without having input from overseas buyers on how to improve the product.

Now having said all that, there are suppliers out there who already sell on Amazon and there will very likely be more in the near future who are capable of all the above especially with the help that Amazon is doing in China now.

But those are are only a few and “we” all have a headstart, the understanding of the marketing, promotional strategy and how the Amazon machine works best.

Eventually Chinese factories will figure all these things out but I am giving this at least 5 years. Essentially what is happening now (or has been happening in the last 2 years) is that a retail giant (Amazon) is trying to teach an entire army of manufacturers why they should sell on Amazon. This is a tremendous project and will take some time. In 5 years, survival of the fittest will have set in so now is the time to step up your game and be among those survivors. One of the most important tasks ahead of you now is to master the import trade so you can compete not only in marketing & sales on Amazon but also price wise.

So here are some important steps for you to remember:

  • Improve your product quality based on reviews
  • Pay a little more for better quality and regulations-compliant products
  • Develop your own products and packagings and make them exclusive for you on Amazon
  • Build or grow your brand with cross product selling and larger assortments
  • Build or grow your audience (Facebook, mailing lists etc.) and be ahead of the Chinese competition
  • Build relationships with suppliers for the long term and become one of their largest customers so that they don’t have to sell on Amazon themselves

And most importantly: Learn the import/export trade from the inside out
What else can you do? Step up your import knowledge and learn the entire import/export business from the inside out so that you not only have advantage over the Amazon marketing & sales process but also know as much about importing/exporting as the Chinese do.
Check out ImportDojo’s Masterclass, teaching you the in’s and out’s of sourcing from China here:
https://importdojo.com/importdojo-masterclass/

Happy sourcing 🙂

4 ways to avoid being scammed by a supplier

The most asked questions I get are “how to avoid being scammed by a supplier” or “how do I make sure this supplier is legit?

To be honest with you the easiest way to make 100% sure is to go visit the factory but I realise that most of you won’t be able to do so.

The goods news is there are ways to figure out if a supplier is legit or not without going to China. The bad news is that some of these options will cost you some money.

Here are my four proven ways of researching a supplier. I will go into detail for each one of them.

1) Factory audits

2) Alibaba research

3) Certificates & reports

4) Skype call

 

1) Factory audits

A factory audit is where you hire a Third-Party Inspection Company to conduct an audit at the factory’s facilities.

This way you can make 100% sure your supplier is legit.

Be aware that not all factories allow you to perform an audit at the location which is in turn already a huge red flag.

If they are willing to undergo an audit straight away it is a good sign already. You don’t necessarily need to perform an audit but announcing to a supplier before you order that you will conduct an audit already gives you some idea on what your supplier is up to.

Lets take a look at the procedure when booking a factory audit. There are many Third-Party Inspection companies out there and I mention them in a few posts (TUV, SGS, Bureau Veritas etc.) but I always use Asiainspection because they are efficient, cost effective and reliable. There are companies out there who charge half the price but you don’t have a convenient interface/dashboard online that lets you do the booking trough their system. Most of the cheaper Inspection Companies have only email/phone conversation bookings available.

Lets take a look at how you can book an audit with a factory online trough Asiainspection.

Login into your account and click on “BOOK NOW” and then click on “Factory Audit”. This is how it looks like:

Screen Shot 2015-07-07 at 9.04.28 am

 

 

 

Next thing is you need to start inputing general information such as your reference, the requested audit date etc.

You also need to let them know if this is a first audit or re-audit. Then they will take extra care for issues that you can input later.

Screen Shot 2015-07-07 at 9.05.26 am

 

 

 

 

In the next mask you input the factory’s detail, contacts and addresses where you want the Inspector to go. The system also stores this information and makes it easier for you next time you want to audit or book some inspection at this factory.

Sample communication with your suppliers. An in-depth guide

I ll cover three topics in this post about sample management:

  • Sample costs
  • Communication
  • Supervision

Sample costs

Once you have settled on a supplier for your new product it is time to purchase a sample.

Most suppliers will charge you for sending a sample. There is usually no way around this unless you have worked with the supplier for a longer time.

Even for me, being here and dealing with suppliers on a daily basis I can’t guarantee that I don’t have to pay for a sample.

Here are some Insider tips to “try” to get a sample for free.

  • Introduce yourself as an assistant of a large company. Suppliers tend to smell money when a large company is interested and are more likely to give away samples for free.
  • State that if the sample is OK you will place a large order
  • State that you have especially chosen this supplier to be your exclusive supplier for this product and he has the chance now to do business with you.
  • Ask him to put the sample cost on top of the official order that may follow if the sample is what you are looking for.
  • State that it is company policy that you/your company don’t pay for samples and if he wishes to do business he should agree to your sample terms.
  • Split the costs. Offer to pay for either the samples or the freight costs.

If none of these work I recommend you to agree with the supplier to deduct the sample costs from the official (larger) order. At least this way you save the sample costs if you decide to order from this particular supplier.

Be wary of sample costs in general

On one occasion I was sourcing for a textile accessory. The item itself can be made for approx 2 USD.

I screened around 10 suppliers and eventually narrowed my selection down to 5 suppliers. They were all in a similar price range.

When it came down to ordering samples one of the suppliers (who was also the most expensive) asked me for a sample fee of 100 USD to be transferred to his bank account. That didn’t make sense.

I immediately knew it must be a trading company with no factory background.

They probably outsource the work to a factory because they have no own facilities. Eliminate suppliers that have high sample costs right in the beginning.

Lessons learned. Re-cap of the Global Sources & Electronics show in Hong Kong

As most of you know I exhibited at the Global Sources Electronics show from 11-14th of April with my brand “Mandarin-Gear” and I went to source at the HKTDC Electronics show on 15th of April.

Here is a re-cap and lessons learned from the shows.

Global Sources show (exhibiting part)

 

 

  • When you exhibit, make sure you get a corner booth or a booth in the middle of the hall where people pass by.
  • Create some buzz on your booth and show enough of your products or just the packaging, play some music if the venue allows it and have some banners that quickly show what your booth is all about.
  • Make sure you have friendly and approachable people ready to explain what your product is all about at your booth.
  • Ask your friends to come visit you. It gives the booth a crowded feeling and people will want to know what’s going on.
  • Have enough marketing material ready (catalogues, business cards etc.)
  • Know your products and make sure any assistants or other people at your booth know everything as well. Be prepared for questions that are unusual. Study your products that you are displaying and make sure that you fully understand them.
  • Take notes and follow up immediately after the fair. Buyers tend to forget who they have visited.
  • Take photos with people that visit you at your booth and send it to them afterwards. Create a relationships. A fair is not just about sales it is more than anything else a networking event.

 

Hong Kong electronics show (sourcing part)

Prepare an introduction for yourself before you go sourcing at a trade fair.

This comes across as more professional and people will be more willing to invest time and resources into you if they feel they deal with someone professional who knows how to do business properly.

You are more likely to build a good relationship if you leave a good first impression. Here is an example how you could introduce yourself:

Hi, I am Manuel and I am the Managing Director of Mandarin-Gear Limited in Hong Kong. I run a Sourcing & Buying office for many large retailers worldwide such as COMPANY X, COMPANY Y. My customers are looking for product “X” and I am interested in discussing more details or to receive a quotation based on my customers requirements.

After the introduction ask questions and once you are satisfied ask him to provide a quotation based on your requirements. Hand him your business card and MAKE SURE that he wrote down everything you discussed.

  • Prepare an introduction of yourself and / or your company
  • Bring name cards, your own catalogue (in case you have one), comfortable shoes and a trolley to carry all the collected catalogues.
  • Pre-register online often saves you money and time
  • Look at freely available maps to find out where the products you are looking for are located before you start walking around. Plan your way through the fair systematically. This is especially important for bigger trade shows.
  • Take photos of products that you are interested in.

Prepare and ask the suppliers questions such as:

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