Importing Business for Germany (and possibly EU)

[petkovic]

Hi guys,

in my introduction thread a couple of months back I said that I was working on some other things and would start a progress thread as soon as I started working on my business in earnest. Now is the time.

What is the situation? I live in Germany, have a degree in electronics engineering and an MBA. For the past 5 years I worked at a research institution that doubled as a consulting agency. I have recently finished writing up my PhD thesis and have become the proud father of a baby daughter. The last five years I have worked my a$$ off for mediocre pay and little appreciation. Almost one and a half years ago I read 4HWW and since got hooked to designing a business suited to my life (but no, I don't intend to peddle supplements). I have spent all this time considering several different business models from inventing, consulting, self-pubbing and what not and have recently decided to go with .... *drumroll* ... Importing. A big thanks to @Vigilante, I believe that what you are doing is the most fitting to our life.

What productive things have I done up to now? After a lot of procrastination on the forum I have finally started actually scouting Amazon for good products. I am loosely following the product research approach provided by @JonnyC on the inside. I use Jungle Scout but not MerchantWords because apparently it does not work for German Amazon (anyone has different information? I haven't actually tried). Instead I use Longtail Pro which I already had a license for but for what I am doing, Keyword Planner is probably ok, too. I have also purchased and read @Walter Hay's book and while I can't claim to have made any money from it yet, I have a feeling it is worth at least 50 times its price.

Using what I describe above I have identified two products that I am confident I can become a top-ten seller on amazon for and that provide healthy margins as defined by @Walter Hay. I am not so thrilled about the monthly sales (good, but not great). However, you don't learn until you act, so I searched for suitable suppliers, not using Alibaba but the sites that @Walter Hay recommends in his books. I have also looked at countries other than China but, admittedly, only where search was relatively easy.

I have identified a total of 10 suppliers (both verified and unverified) from mainland China and Taiwan and have written to them all. 5 of them I have contacted two days ago and 5 of them yesterday (they had 1 or 2 business days to answer). Up to now, I have received an answer from only one company but they sent me a catalogue that was unrelated to the product I requested and in the meantime I had already found out that they are a trading company.

This is currently bugging me: So now I'm waiting and looking for other product categories in the meantime. Once I start, I tend to become a little impatient. For those of you with experience, is it normal for companies to take more than two days to reply to the request for a simple catalogue? I used the wording that @Walter Hay recommends so I think it should be professional enough. The problem could be that I use a disposable email address (thank God!) that contains my imaginary company's name but ends on @yahoo.com. Maybe this identifies me as small fry?

Side note (maybe I can help you): My consulting work in the last 5 years was with regard to quality management and process optimization. From what I have seen on the forum you guys take a healthy, uninvolved approach to quality, basically checking it end-of-line either yourself or using third-party inspection companies. Nothing wrong with that usually. If you have issues going deeper than that, feel free to contact me and just maybe I can help you. I would be very happy to do so. I have also consulted with Chinese companies in the past.



So, long story short: Welcome to my journey! I will keep you posted and feel free to ask questions and to keep me accountable ;-)

 

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[Brian C.]

I have identified a total of 10 suppliers (both verified and unverified) from mainland China and Taiwan and have written to them all. 5 of them I have contacted two days ago and 5 of them yesterday (they had 1 or 2 business days to answer). Up to now, I have received an answer from only one company but they sent me a catalogue that was unrelated to the product I requested and in the meantime I had already found out that they are a trading company.

This is currently bugging me: So now I'm waiting and looking for other product categories in the meantime. Once I start, I tend to become a little impatient. For those of you with experience, is it normal for companies to take more than two days to reply to the request for a simple catalogue? I used the wording that @Walter Hay recommends so I think it should be professional enough. The problem could be that I use a disposable email address (thank God!) that contains my imaginary company's name but ends on @yahoo.com. Maybe this identifies me as small fry?

Willkommen @petkovic . Herzlichen Glückwunsch mit ihrer Tochter.

I am currently involved in a similar process here in the United States, and am now moving on to importing my second product. I aim to do business with Germany in the future, and maybe even live there. It's exciting to see someone from Germany beginning their importing journey.

Regarding your current issue, there could be several reasons. The time difference between Germany and Asia could play a minor role - although I doubt that is the primary reason for lack of response.

In my experience, some companies are exceptional at communicating, while others take days to respond - it all depends. For me, I begin communicating with suppliers at 9PM, which in Asia is 9AM. Doing this, sometimes the time difference between messages is minutes. I have this happen on Alibaba often. I know Walter recommends other sourcing platforms in addition to Alibaba, but there is nothing wrong with using Alibaba - just be careful, use due diligence, and follow the guidelines in his book for safe sourcing.

There may be an issue regarding the different sourcing platforms. Perhaps these manufacturers are not checking these other platforms often. Maybe they are, but just don't want to deal with you based on your inquiry. It's difficult to say without fully understanding your process.

You can always find contact information provided by those sourcing sites and contact the manufacturers directly. I'd assume that would give you a better chance of response.

I'll be watching this thread to see how things turn out. Glad to see you are taking action.

Viel Glück.

 

[petkovic]

Willkommen @petkovic . Herzlichen Glückwunsch mit ihrer Tochter.

I am currently involved in a similar process here in the United States, and am now moving on to importing my second product. I aim to do business with Germany in the future, and maybe even live there. It's exciting to see someone from Germany beginning their importing journey.

Regarding your current issue, there could be several reasons. The time difference between Germany and Asia could play a minor role - although I doubt that is the primary reason for lack of response.

In my experience, some companies are exceptional at communicating, while others take days to respond - it all depends. For me, I begin communicating with suppliers at 9PM, which in Asia is 9AM. Doing this, sometimes the time difference between messages is minutes. I have this happen on Alibaba often. I know Walter recommends other sourcing platforms in addition to Alibaba, but there is nothing wrong with using Alibaba - just be careful, use due diligence, and follow the guidelines in his book for safe sourcing.

There may be an issue regarding the different sourcing platforms. Perhaps these manufacturers are not checking these other platforms often. Maybe they are, but just don't want to deal with you based on your inquiry. It's difficult to say without fully understanding your process.

You can always find contact information provided by those sourcing sites and contact the manufacturers directly. I'd assume that would give you a better chance of response.

I'll be watching this thread to see how things turn out. Glad to see you are taking action.

Viel Glück.

Danke für die lieben Worte!

Great to hear that you are considering with or in Germany! If ever you need information about the country or how things work over here, just leave me a message and I am sure I can help you in some way.

Your considerations on the response rate of manufacturers makes a lot of sense. I initially intended not to use the contact facilities of the sourcing sites but to find out an email address. I am usually the type to go this little extra mile. But for my first email it was very late at night and I couldn't figure out quickly how to send email from my disposable address so I just went with the contact form of the sourcing site and kept that approach. Sure, I don't know if that is the problem but now I am left wondering if I might have gotten a response if I had just worked a little harder. Lesson learned!

Also, I have not considered Alibaba until now, but you are right, I should not disregard it completely, provided I do my DD. I will extend my search to include Alibaba (with lower priority than the others).

Btw, after posting my first message I received another response. They provided me with a nice high-quality digital catalogue (13 pages in individual JPEG-files...) but did not include prices although I specifically asked for them. Normal?

I will see if I can get some more information on these two products, but as I indicated, I am not 100% convinced of them anyway, so I continue looking for alternatives. I will keep you posted!

 

[Dan1el]

Congrats on taking your first steps! Looking forward to follow your progress thread @petkovic
Im currently in the importing business within EU (Sweden) myself, feel free to shoot a PM if you got any questions or want to ball ideas or whatever.

Good luck!

 

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[Niptuck MD]

Hi guys,

in my introduction thread a couple of months back I said that I was working on some other things and would start a progress thread as soon as I started working on my business in earnest. Now is the time.

What is the situation? I live in Germany, have a degree in electronics engineering and an MBA. For the past 5 years I worked at a research institution that doubled as a consulting agency. I have recently finished writing up my PhD thesis and have become the proud father of a baby daughter. The last five years I have worked my a$$ off for mediocre pay and little appreciation. Almost one and a half years ago I read 4HWW and since got hooked to designing a business suited to my life (but no, I don't intend to peddle supplements). I have spent all this time considering several different business models from inventing, consulting, self-pubbing and what not and have recently decided to go with .... *drumroll* ... Importing. A big thanks to @Vigilante, I believe that what you are doing is the most fitting to our life.

What productive things have I done up to now? After a lot of procrastination on the forum I have finally started actually scouting Amazon for good products. I am loosely following the product research approach provided by @JonnyC on the inside. I use Jungle Scout but not MerchantWords because apparently it does not work for German Amazon (anyone has different information? I haven't actually tried). Instead I use Longtail Pro which I already had a license for but for what I am doing, Keyword Planner is probably ok, too. I have also purchased and read @Walter Hay's book and while I can't claim to have made any money from it yet, I have a feeling it is worth at least 50 times its price.

Using what I describe above I have identified two products that I am confident I can become a top-ten seller on amazon for and that provide healthy margins as defined by @Walter Hay. I am not so thrilled about the monthly sales (good, but not great). However, you don't learn until you act, so I searched for suitable suppliers, not using Alibaba but the sites that @Walter Hay recommends in his books. I have also looked at countries other than China but, admittedly, only where search was relatively easy.

I have identified a total of 10 suppliers (both verified and unverified) from mainland China and Taiwan and have written to them all. 5 of them I have contacted two days ago and 5 of them yesterday (they had 1 or 2 business days to answer). Up to now, I have received an answer from only one company but they sent me a catalogue that was unrelated to the product I requested and in the meantime I had already found out that they are a trading company.

This is currently bugging me: So now I'm waiting and looking for other product categories in the meantime. Once I start, I tend to become a little impatient. For those of you with experience, is it normal for companies to take more than two days to reply to the request for a simple catalogue? I used the wording that @Walter Hay recommends so I think it should be professional enough. The problem could be that I use a disposable email address (thank God!) that contains my imaginary company's name but ends on @yahoo.com. Maybe this identifies me as small fry?

Side note (maybe I can help you): My consulting work in the last 5 years was with regard to quality management and process optimization. From what I have seen on the forum you guys take a healthy, uninvolved approach to quality, basically checking it end-of-line either yourself or using third-party inspection companies. Nothing wrong with that usually. If you have issues going deeper than that, feel free to contact me and just maybe I can help you. I would be very happy to do so. I have also consulted with Chinese companies in the past.



So, long story short: Welcome to my journey! I will keep you posted and feel free to ask questions and to keep me accountable ;-)

keep it up and wilkommen. good to hear your story and insight. best of luck

 

[Niptuck MD]

oh btw i will be visiting my sister in munchen maybe there can be a meetup around 1st week of june 2017

 

[petkovic]

Congrats on taking your first steps! Looking forward to follow your progress thread @petkovic
Im currently in the importing business within EU (Sweden) myself, feel free to shoot a PM if you got any questions or want to ball ideas or whatever.

Good luck!

Thanks Dan1el, once I get to the importing stage I am sure I will follow up on the offer!

oh btw i will be visiting my sister in munchen maybe there can be a meetup around 1st week of june 2017

Lucky guy, Munich is a great city. At least that's what people tell me, I have only ever spent a day there flying in in the morning and out again late in the evening . Let's keep this in mind, June 2017 is a long time to go and I am very curious what my life and professional situation will look like then

 

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[petkovic]

On my "getting suppliers to get back to me" woes: I got two more answers so now I am 4 for 11 (sent out one more inquiry). Interestingly, this means I got responses from almost all suppliers for one product type and basically none from the other product type. I have now made a new gmail-address as someone said that gmail is mostly recognized in China now as an email hosting provider for professionals as well. The base name includes my "company name" and my department (I am posing as the head of purchase for the company). I will use this new address to contact them directly via email addresses.

Also, during my latest trips into the amazon world I discovered a product category that I am actually excited about. Excited in the sense that it has high sales volume, I should expect decent margins, there are many different possible configurations that justify ten-fold increases in retail price (I would start nearer the lower end but it is nice to know that there is demand for a 10x product) and it actually does intersect with my interests which is not a necessity but certainly nice. I believe there are no unsolved problems in this category but there is a certain lack of supply for a specific kind of configuration that I believe would appeal to a large chunk of this market.

Two obstacles I see at the moment: One is that the average number of reviews in this category is slightly high (110), but there are some items on the first page with less than 30 reviews and Jungle Scout tells me that living on the second page in this category is not at all bad, either. The second is that it is not easy to judge the quality and practicability of the product without actually holding it in the hand (i.e. you definitely cannot infer it from product pictures).

I will approach this in two ways: One is due to my privileged position as an importer to Germany. I have always bitched about all the things available in the US that are not available here. Now I will use that to my advantage by cross-checking my supplier's product portfolio with Amazon US listings and try to identify suppliers that have exported high-rated products to the US before. The second will be to provide clear technical limitations to the suppliers before I go to the sample ordering stage. And then order samples from several suppliers to test them out. Oh well...

EDIT: One word on brand recognition: In this category, there are some names that pop up again and again in other site's reviews and they are also well-placed in the top spots. But they are not strong brands that you would immediately recognize even if you were deeply involved in the larger category this product caters to. So I guess that should not be a bigger problem.

 

[Brian C.]

Btw, after posting my first message I received another response. They provided me with a nice high-quality digital catalogue (13 pages in individual JPEG-files...) but did not include prices although I specifically asked for them. Normal?

In my personal experience, I rarely receive pricing in catalogues from manufacturers. Even though you asked, you might be better off asking for a quotation for the potential order of your desired product.

I will approach this in two ways: One is due to my privileged position as an importer to Germany. I have always bitched about all the things available in the US that are not available here.

This. This gets me excited.

Perhaps I misread your post, but the notion of availability and unavailability of products in both Germany/US excites me. I may be getting ahead of myself, but the barriers to entry are skills we already both posses: mild understanding of the import/export process, ability to speak both German and English, distribution experience, etc.

I've had my eye on this potential opportunity for some time. Now, it comes down to finding the product that fills the void in the respective country, and taking action.

Perhaps we can be of some help to each other in the future.

 

[kkompoti]

I have worked my a$$ off for mediocre pay and little appreciation

describing my job to the point

 

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[petkovic]

In my personal experience, I rarely receive pricing in catalogues from manufacturers. Even though you asked, you might be better off asking for a quotation for the potential order of your desired product.

You are right, will do! I am mildly interested in a product from China for one of my first two niches. The product is unique in its function in the way that it combines the different working principles possible in this niche into one product. However, a customer can only apply one of the working principles at a time. Now I am thinking if there is an angle to marketing this. I might continue down this path, but it is not as interesting as my new niche anymore.

In the new niche I have ordered several products from my competition from the entire price range to see what I am up against. Now I have a much better idea when looking for manufacturers. My dream is to create a variation of this product that I can market to a specific audience that is not being catered to at the moment. This however involves a tiny bit of electronics, so it will be a little tricky. Let's see what comes out in dialog with the manufacturers.

This. This gets me excited.

Perhaps I misread your post, but the notion of availability and unavailability of products in both Germany/US excites me. I may be getting ahead of myself, but the barriers to entry are skills we already both posses: mild understanding of the import/export process, ability to speak both German and English, distribution experience, etc.

I've had my eye on this potential opportunity for some time. Now, it comes down to finding the product that fills the void in the respective country, and taking action.

Perhaps we can be of some help to each other in the future.

I am sure this can be a huge advantage. It is now happening frequently that I start looking for suppliers, look at some of their products and find them on amazon, probably by some other FBA gold digger. But you know what: Most of these people lack any imagination and they just pick the first product they see on alibaba and throw it onto the market. Not surprisingly, they don't sell a lot because (surprise) 3 other people are doing exactly the same.

But there are also other examples. Where one guy has dug a little deeper, found a good product in China, is successful with it and the only one selling. Usually, this specific product will just be sold on Amazon US. If it gets good reviews, you should be safe sourcing the same product for the German market.

 

[Niptuck MD]

Thanks Dan1el, once I get to the importing stage I am sure I will follow up on the offer!



Lucky guy, Munich is a great city. At least that's what people tell me, I have only ever spent a day there flying in in the morning and out again late in the evening . Let's keep this in mind, June 2017 is a long time to go and I am very curious what my life and professional situation will look like then

yea man maybe we can go to a biergarten or something. I am primarily going to also visit the big port of hamburg up north

 

[petkovic]

Oops, I spent so much time in Walter's thread that apparently I forgot to update here... So, this happened:

I got my first quotes. Apparently, it is normal that when you ask for a catalog and price list, you don't get a price list. Asking for a specific product helps, though. There are two suppliers that have a product that would fit my needs quite well. One has not responded to my initial email and I have now written a second one, being a bit more specific. If I get no response again, that's the end of that.

With the other I have been in close contact for the past ~10 days and they have provided me with a quote for 3000 units of their product FOB Hongkong. They also detail additional charges for going below this quantity. The price looks ok, but I will have to see a quote including door-to-door freight to be sure. That threw me into a kind of a mess for a moment. I would prefer the products to be shipped by air, but they contain a Lithium-Ion battery. As you may know, IATA has imposed regulations on air cargo of batteries as of April this year. This had me going a bit back and forth with the supplier but it looks like the way they package the goods it will be ok to ship by air.

There is still another thing, though. As this is an electronic product, the EU requires a shitload of beauraucratic stuff, including, but not limited to, CE marking and RoHS certification. Problem: The supplier has never sold this product and is currently in the process of making the tools (probably waiting for the first order). They say they can handle the certification stuff depending on the order size. I, of course, want to place a small order initially.

So, currently I am figuring out how to best approach this with the supplier. Based on @RisingStars' record of semi-traumatic experiences of the same kind in Germany, I may also look for another supplier. Or maybe start with a slightly different product from this supplier. I will let you know!

 

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[maniek00000]

do you have a company already?

 

[petkovic]

do you have a company already?

Not yet. On Monday I will attend a seminar of my local industry and trade organization (IHK) where hopefully I will learn a bit more about this topic. I also need information because I have to formally register as a consultant (in Germany you have to register for everything). Currently I presume that I will incorporate the import business as "UG (haftungsbeschränkt)" which is very similar to the British "Ltd.". Hopefully still this year.

For my communication with suppliers I invented a business name and gave myself the title of Purchasing Manager (to have a boss to blame if I don't want to do what they want me to). I will probably register under a different name before I place my first order and I will have to tell them they are now dealing with a new business name. But I think that won't be a big problem.

 

[RisingStars]

Hey @petkovic congrats on your action so far. I am glad that you could learn a bit from my thread.
There are a lot (and I mean really a lot) things you have to take care of if you want to build a sustainable business in germany.
After my experience I've found some really good resources, so if you have any questions or want to get german specific resources just sent me a PM.
Would be glad to help you

 

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[petkovic]

Hey @petkovic congrats on your action so far. I am glad that you could learn a bit from my thread.
There are a lot (and I mean really a lot) things you have to take care of if you want to build a sustainable business in germany.
After my experience I've found some really good resources, so if you have any questions or want to get german specific resources just sent me a PM.
Would be glad to help you

Definitely! I wanted to PM you eventually but I needed to get a bit of structure into my thinking. Almost done

Just wanted to check in to say that I just came back from the IHK seminar where I pre-sold my first product to the tutor. Bam!

 

[miked_d]

Great work!

I have always bitched about all the things available in the US that are not available here.

This your NEED. I have sold lots of stuff on eBay but would only ship to US. Why? Customs is a pain, buyers complain about shipping times, etc.

Identify hot selling items on Amazon US that are not available on Amazon Germany or EU. This is not perfect as there can be copy-cats but it is worth some thought.

Slightly off-topic -- I was asked 30 minutes ago by someone in Germany why I will not sell a digital item to them. I have had a high percentage of sales in Europe make PayPal chargebacks. It is not worth the hassle for me (at this time).

 

[RisingStars]

Definitely! I wanted to PM you eventually but I needed to get a bit of structure into my thinking. Almost done

Just wanted to check in to say that I just came back from the IHK seminar where I pre-sold my first product to the tutor. Bam!

Congratz on pre-selling your first product. I bet you are addicted now

 

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