Ridiculously High Sample Fees

[Gravy South]

So I have had a few products in my mind which I want to import them from China. I have already received a few invoices and they are waiting for my payment. However they are simply way too expensive and sometimes a supplier charge more than $100 of freight cost. The product unit cost are at least 3 times higher than supposed unit cost match by the MOQ. I know they are annoyed by all the opportunists who try to get stuff on the cheap, but these ridiculous prices would only push away their potential buyers

So does anyone have any tips on how to negotiate a much more reasonable fee? Anyone who is trying to play the import game experiencing this as well?

 

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[Phones]

They get 100's of people like you everyday.

It's not just a cost problem for them, it's actually a way to know if you are really interested or not. The cost, both in money and time, they would have if they sent samples for free/cheap would lead them no where. Also, as soon as you order the sample and transfer the money, they start treating you with more respect.

And be glad you're only paying 3x, just make sure that what you spend on the sample (except shipping) is deductible from the final order and that the shipping cost is decent.

 

[ND88]

Just accept it - It's a cost.

You can sometimes get free samples but you will always have to pay the express freight. It's not big deal mate, it's just a cost of doing this type of business. I've got lots of expensive (and now useless) samples hanging around my house .

It's all worth it when you find that one sample which ticks all the boxes though!

 

[Gravy South]

So is it normal to make a huge loss on the sample products these days? I dont mind just to break even or making a small loss on the first batch, but to make a huge loss right from the beginning...maybe this is what I have to get used to.

 

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[ND88]

How many units are we talking about here? For example, when I was looking for my last product I ordered 8 different units from the same manufacturer - costing me about $200 for delivery to the UK.

I don't sell my samples, they're used purely for finding the right product to take to market.

 

[Gravy South]

How many units are we talking about here? For example, when I was looking for my last product I ordered 8 different units from the same manufacturer - costing me about $200 for delivery to the UK.

I don't sell my samples, they're used purely for finding the right product to take to market.

Ah I do it slightly different.

I order 5 units each on the product I like, and I plan on selling them on multiple channels to test the demand. Because I think if I only have 1 product, there is no way I know the demand since there are no repeat orders.

 

[ND88]

Ok matey - I personally wouldn't be doing that with only 5 units, difficult to judge demand with such little inventory

I'd generally find the product I want via samples, then my first order of my product would be 50-100 units. No big deal, only a few hundred quid - test the market and see if the product is received well.

Everyone has their own ways though! Hope you're doing well

 

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[ddzc]

How heavy is the product? All depends on what your importing. On heavy items, I will typically lose money on sample orders, which is fine, they're not meant to profit from and it's impossible to in most cases when the product is heavy and your shipping air freight. Heavy products only make you money when you ship via container and sea.

If it's lightweight, it could be a product which makes you money based on volume sales so again you probably wont make much off a sample. I have a product line which does make me money even on sample orders bc it's awesome. All depends what your bringing in, so many different scenarios.

Don't be afraid to lose a bit of cash on samples, it's all part of the game.

 

[GuestUser113]

I just went through this myself. My samples were cheap. The 3-5 day freight was a bit high. That's ok though. I realize that if I like what I see, as well as the market. The cost goes down when ordering a larger quantity.

 

[RazorCut]

As said its the cost of doing business however often these things seem not to make a lot of sense.

I recently needed an electronic component for a prototype I was working on. I purchased a couple from a general trader in China that sells them in single units. I paid about $7-8 for two including shipping. Once the prototype was proved successful I contacted the manufacture directly for a price on 500 units to start with. Their quote was higher per unit cost than I paid for the two sample ones and that did not include shipping either. Go figure that out.

Regarding shipping the costs are all relative. I used to sell leather cord. I would air freight over 80,000m (about 50 miles) at a time from India several times a year. It never bothered me paying extra for air freight over a slow boat as the cost of air freight only added a penny per metre to the total cost so was not worth worrying about compared to the convenience of only waiting 3-4 days for delivery.

It has been years since I imported a whole shipping container full of product. That was not a nice experience (what should have taken 6 weeks took over 4 months) and so one experience I do not relish repeating, though hopefully it will happen sometime this year if things pan out as planned.

 

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[Walter Hay]

There are two possible solutions to this problem, or if not solutions they are ways to minimize the effect.

1. Ask for the sample to be sent via China Post or if they are located in or close to Hong Kong, get them to use HK Post for preference. For more info see my AMA post Sharing my lifetime experience in export/import. Product sourcing specialist. Please ignore the typo there "sue" should be "use".
   
2. Ask them to quote you for a larger sample order. Instead of 5 or 10, get a quote for 50 or 100, maybe even more depending on the price. You may be risking a bit more, but if the product is as good as you think it is, your unit price landed will be substantially lower and that presents an opportunity to make a profit while doing a thorough market trial.

 

[RazorCut]

Please ignore the typo there "sue" should be "use".

Hey @Walter if the typo bothers you there should be an edit option at the bottom of the post so you can correct it if you wish.

 

[teabag]

My first import from China - product cost me $1,300.00

Shipping was $750

$750 shipping I thought for such small products - couldn't be.

I got my own quote from Australia to China and the most expensive price came to be $620

It only took me a minute to decide I'll pay for the shipping because if I don't - someone else with the same idea, will.

 

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[Walter Hay]

Hey @Walter if the typo bothers you there should be an edit option at the bottom of the post so you can correct it if you wish.

Thanks, but the post dates back to Jan 27 and it appears that the edit function expires after a set period. I wish it didn't because when finding a subject via the search facility I sometimes see where I could have answered better.

 

[Walter Hay]

My first import from China - product cost me $1,300.00

Shipping was $750

$750 shipping I thought for such small products - couldn't be.

I got my own quote from Australia to China and the most expensive price came to be $620

It only took me a minute to decide I'll pay for the shipping because if I don't - someone else with the same idea, will.

Once freight quotes get to that level, even $620, it would pay everyone to get quotes from a couple of freight forwarders.

Just be sure that the lower cost one includes door to door costs, including Customs clearance. Local costs can be as high as the sea freight or air freight alone. Always get your quote in writing.

Also make sure you are comparing apples with apples. Freight from Australia to China will often be lower than China to Australia because a lot of empty containers are being transported back to China. The same can apply in relation to other countries too, so wherever you are, always get an actual China to you price rather than rely on the Your Country to China calculation.

To a lesser extent this price difference for direction of shipping also applies to air cargo.

 

[Walter Hay]

As said its the cost of doing business however often these things seem not to make a lot of sense.

I recently needed an electronic component for a prototype I was working on. I purchased a couple from a general trader in China that sells them in single units. I paid about $7-8 for two including shipping. Once the prototype was proved successful I contacted the manufacture directly for a price on 500 units to start with. Their quote was higher per unit cost than I paid for the two sample ones and that did not include shipping either. Go figure that out.

Regarding shipping the costs are all relative. I used to sell leather cord. I would air freight over 80,000m (about 50 miles) at a time from India several times a year. It never bothered me paying extra for air freight over a slow boat as the cost of air freight only added a penny per metre to the total cost so was not worth worrying about compared to the convenience of only waiting 3-4 days for delivery.

It has been years since I imported a whole shipping container full of product. That was not a nice experience (what should have taken 6 weeks took over 4 months) and so one experience I do not relish repeating, though hopefully it will happen sometime this year if things pan out as planned.

@ RazorCut You raise a couple of interesting issues.

The higher price quoted by the manufacturer is most likely due to the nuisance factor. Although any genuine manufacturer will usually accept orders for a lot less than their MOQ, there are those who are accustomed to dealing in many thousands and they can't be bothered with small orders, so they price the buyer out of their sight by overpricing. Maybe you could do a deal with the trader?

I have often found as you did with your leather rope, that the extra cost when shipping by air is so low that it is insignificant. Another factor that should be considered is opportunity cost. While a shipment is on the water for 6 - 8 weeks (usual) what could you do with the money you have already paid the supplier and the carrier? Or ... if you borrowed from the bank to pay, how much interest are you paying while you wait for that shipment to hit your marketplace?

Your mention of a container taking over 4 months instead of the expected 6 weeks is another important issue for importers to consider. Delays happen for a variety of reasons, including wharf labor disputes as we have seen recently on the US West Coast. One that can make or break an importer is a Customs random inspection. Not only can that cause lengthy delays, but they rub salt into the wound by charging you a substantial sum to have your shipment inspected!

When I was importing, everything came by air. I generally avoided buying bulky goods, but when I needed to buy some moderately bulky shipments my freight forwarder negotiated "commodity" rates that, when all service costs were taken into account, were very close to sea freight prices. Those shipments sometimes took a week or so longer than standard air freight.

 

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[WolfNinjaUK]

my freight forwarder negotiated "commodity" rates that, when all service costs were taken into account, were very close to sea freight prices.

Hi Walter, could I ask you to elaborate a little on this? What are commodity rates?

 

[ZeroExile]

Interestingly enough, there is good reason for this. I have heard personally on other forums on ways to get free things from major wholesale sites like alibaba.com. I saw it in a thread one day, they basically copy and paste this really elaborate letter in order to get a free sample sent to them, then decline by saying it was defective or whatever. This became more common and now most have patched the exploit. Now most are always skeptical that it's another scammer. Of course that and they want to profit anyway just in case you are not interested.

Edit: You can reduce the price by negotiating but it might take a while for it to be completely free of charge, an inconvenience on their part as well.

 

[Walter Hay]

Hi Walter, could I ask you to elaborate a little on this? What are commodity rates?

Commodity rates are bulk rates that usually relate to things like food and flowers. They are often available but your freight forwarder has to be keen.

There may be 8 or 10 aircraft that have full loads, then he finds one that has spare capacity. This can mean that your freight sits around for a few days, but after all, unless it is desperately urgent it is worth the slight delay.

 

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