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Need help importing from china using Alibaba wholesale "ready to ship"

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P3HSB

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hi, i been looking around and found a product i would like to sell. This product was found in the alibaba "ready to ship" wholesale section. I am trying to figure out exact cost shipped to my door. The product cost per unit is $8.00. MOQ is 100, so total cost of the product is $800. Shipping cost is $797.10 via express method. The grand total comes out to Total $1,597.10.

Is the grand total the actual cost? Or is there some kind of hidden cost i am not aware of that will come back to haunt me later? Has anyone have any experience using Alibaba "ready to ship" wholesale section? What are your thoughts on it and is it as simple as what it appears to be if your just ordering a relatively small shipment?


3359333594
 

sparechange

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I had to pay a duty tax and DHL to deliver it to my storage facility, so yes sometimes sneaky things can pop up :D

Long time ago, but was really shocking to see a bill for around $100 attached to my packages (had around 6-7 boxes?) 300 units of dog toys and stuff.

Different suppliers will charge various amounts for shipping, your best will be to vet multiple suppliers to make sure you get the best price.

Also when dealing with Alibaba keep in mind you are not talking to the manufacturer them self, it's generally middlemen taking a % of the sale for connecting you.

If this is your first rodeo go with a smaller order like 10 units to see if you can even sell them. You can always sell pre-orders or do the ''sold out'' trick on your on website. Might save you alot of money..
 

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sparechange

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Also express shipping should be quicker than 5 days I think, again it's been a while since I've used alibaba, but I think I waited for a week or something for regular shipping (plane)

The price difference between express and reg was hundreds of dollars.... Which you don't want to pass off onto the customer.
 

P3HSB

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Long time ago, but was really shocking to see a bill for around $100 attached to my packages (had around 6-7 boxes?) 300 units of dog toys and stuff.

Wow, interesting. That is what i was afraid of. How does the bill get paid? Do you just log into the shipping service website and pay with a credit card? Sometimes i worry if a scammers can just attach a fake bill and charge me or something lol

If this is your first rodeo go with a smaller order like 10 units to see if you can even sell them. You can always sell pre-orders or do the ''sold out'' trick on your on website. Might save you alot of money..

I been buying and selling small qtys through aliexpress but the margins are very thin. Aliexpress is almost like retail price
 

sparechange

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Wow, interesting. That is what i was afraid of. How does the bill get paid? Do you just log into the shipping service website and pay with a credit card? Sometimes i worry if a scammers can just attach a fake bill and charge me or something lol



I been buying and selling small qtys through aliexpress but the margins are very thin. Aliexpress is almost like retail price

Attached to my boxes was an invoice that was payed by bank transfer, no issues.

If you have sold alot of product already then I guess yeh, go for it!
 

AgainstAllOdds

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Assuming you're in the U.S., here you go: Harmonized Tariff Schedule Search. Figure out how to use that.

Once you have that, take that number and then look at the attached list. Use the attached list to see what percentage you add on. This is your tariff rate.

Let's say your tariff rate is 31%, then you do 1597.1 + .31 * 800 = $1,845.1. That's the total that you're paying with tariff.

As @sparechange said - you'll get a bill later. He's in Canada so might be different. In the U.S., you might have DHL send you a bill 6 months down the line. The bill will be for the declared value x tariff.

Sometimes you squeeze through the cracks... but I wouldn't count on it. Budget as above.
 

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P3HSB

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@AgainstAllOdds wow, thanks for the info. This was very helpful.

In the U.S., you might have DHL send you a bill 6 months down the line. The bill will be for the declared value x tariff.

Sometimes you squeeze through the cracks... but I wouldn't count on it. Budget as above.

Yes, I am located in the US.

This is what i was nervous about! Getting a bill 6 months down the line!? Why can't i just get the bill immediately so i can pay it off and get it over with. This makes it very complicated imo. But you'll probably get use to it huh?


Let's say your tariff rate is 31%, then you do 1597.1 + .31 * 800 = $1,845.1. That's the total that you're paying with tariff.

So my total cost would be $1,845.1 with tariffs. Divide that by 100 units, that leaves me with a $18.45 product. If i Sell for $35.00 that would leave me with a profit of $16.55 then minus all of the fees/shipping ill probably be left an estimate of $10.00 take home

Sometimes I wonder if its worth all of the work for such a small profit, but the game is won by death of a thousand cuts i assume...
 

inputchip

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You could probably get your unit cost down by finding an actual manufacturer for your product. You are likely buying from a trading company if you are in that section of Alibaba.

What shipping method are you using? If it's DHL, it will be quite a bit more expensive than normal air freight.
 

sparechange

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@AgainstAllOdds wow, thanks for the info. This was very helpful.



Yes, I am located in the US.

This is what i was nervous about! Getting a bill 6 months down the line!? Why can't i just get the bill immediately so i can pay it off and get it over with. This makes it very complicated imo. But you'll probably get use to it huh?




So my total cost would be $1,845.1 with tariffs. Divide that by 100 units, that leaves me with a $18.45 product. If i Sell for $35.00 that would leave me with a profit of $16.55 then minus all of the fees/shipping ill probably be left an estimate of $10.00 take home

Sometimes I wonder if its worth all of the work for such a small profit, but the game is won by death of a thousand cuts i assume...

Wait until the IRS gives you a call :rofl: :rofl:
 

Envision

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You need to make contact with the manufacturer.

Dont order off of Alibaba direct

Start a conversation with the supplier, move the conversation to wechat to make your order, finalize with paypal if you can for your first run only after you've confirmed everything with the supplier.

You won't have to pay tariffs on a small order like that, if they're air shipping the vendor/supplier will have covered it - just confirm that with them.
 

P3HSB

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What shipping method are you using? If it's DHL, it will be quite a bit more expensive than normal air freight.

the shipping service just says "Alibaba.com Parcels (>20KG) 9-11 working days US$ 795.8


Wait until the IRS gives you a call :rofl: :rofl:
:wideyed:

You need to make contact with the manufacturer.

Dont order off of Alibaba direct

Start a conversation with the supplier, move the conversation to wechat to make your order, finalize with paypal if you can for your first run only after you've confirmed everything with the supplier.

I'm will to pay a slightly higher premium for speed. I want to get the product out and test/sell as fast as I can. Do not want to get into conversation with supplier till I start branding and tweaking the product to improve it
 

AgainstAllOdds

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Don't worry about the IRS. That's not a thing unless you're cheating taxes down the line.

The $10 you're making a unit might not be worth it today, but is if you can scale. Scale allows for a few things including:

Buying in bulk for a lower price, and sea shipping. Your freight costs plummet at volume.

Also when you clear your own shipments, you pay the tariffs right away and are done with it. I've had DHL experiences where they sent me bills 6 months down the line, but I also haven't dealt with importing via DHL in awhile other than samples - for which there's almost never a tariff.

If you hit scale, then you can hypothetically make $20 a unit let's say. It's obviously not worth the effort if you're selling 5 units. But if you sell a thousand units, then that's $20k. Expand the product line to 10 products of equal level and you're making $200k minus the employees that you hired at that time to run everything.

Managerial accounting is your friend. Figure out the numbers, and then figure out if it's worth launching the product for future growth.

At your stage, it's worth it just for the education.
 

AgainstAllOdds

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Oh:

What you should be scared of and 99% of the people on here don't know about are anti-dumping products. If you import an anti-dumping product, then you can get hit with an additional tariff before the government decides to "close the case". That's usually around 2 years after the import and can be as high as hundreds of percent of the product value.

To check on an import, just type into google: "anti-dumping + your product". See if there's any cases open. If a case has been opened, then doesn't matter if no CVD or ADD was established yet, you're going to pay some crazy tariff way after the fact.

Imagine getting hit with $100k+ in bills after you start growing. Shit sucks.

We gambled on certain products fully knowing what could happen, and got hit hard, but still had enough margin to break even. There's others that go belly up - like all the guys importing quartz that had to turn containers away since they didn't know what they were doing. With anti-dumping it's a question of how you want to play it. The preferable route is to find a producer that doesn't have cases open against them (usually you want someone outside of China), but it's not always possible.

Note: This scenario is very rare, but depends on the industry. In the building materials industry this is something we navigate regularly, so anyone reading that ever has questions - feel free to reach out.
 

Envision

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I'm will to pay a slightly higher premium for speed. I want to get the product out and test/sell as fast as I can. Do not want to get into conversation with supplier till I start branding and tweaking the product to improve it

Why launch with a half though out approach? Speed for what? To prove your concept?

Wouldn't private labeling it with a single conversation improve your odds of success 10x faster?

Never understood the fast mindset, doesnt matter if it doesnt sell.
 

Walter Hay

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I hope I have not come upon this thread too late to save the OP from losing his shirt, but he should have at least taken the advice of @francevalue to have a look at my threads. If he searched my AMA with keywords relating to his questions he would have found definite answers - no guesses - no generalizations.

The first question: Is the grand total the actual cost? Or is there some kind of hidden cost i am not aware of that will come back to haunt me later?
Answer: NO. There will also be duty, and possibly sales tax. IMPORTANT: The value for calculating duty and tax is FOB or EXW price + Freight and insurance. It is not calculated only on the invoice value unless that includes the freight cost.
Second question: Has anyone have any experience using Alibaba "ready to ship" wholesale section? What are your thoughts on it and is it as simple as what it appears to be if your just ordering a relatively small shipment?
Answer: You are obviously dealing with a middle man who may or may not have the goods in stock. They might have a friendly arrangement with the manufacturer, who is possibly a relative. You will be paying more than you should.
Third question: How does the bill get paid? Do you just log into the shipping service website and pay with a credit card?
Answer: If you use an air courier, they will notify you of the amount that they have paid on your behalf, and usually nominate payment method. CC or transfer.
Fourth question: Why can't i just get the bill immediately so i can pay it off and get it over with.
Answer: The decision on how much duty and tax is payable will never be made by your carrier. You just have to go with the system.

There is a need to understand other things also. "Air" or "Air Freight" is different to "Air Courier". If you ship by air freight, chances are the cost can be substantially higher unless you have arranged shipment through a freight forwarder.

Trying to find your duty rate by looking at the Harmonized Tariff Schedule can lead to mistakes. Instead use a Free Duty Calculator

Walter
 

Ronak

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Assuming you're in the U.S., here you go: Harmonized Tariff Schedule Search. Figure out how to use that.

Once you have that, take that number and then look at the attached list. Use the attached list to see what percentage you add on. This is your tariff rate.

Let's say your tariff rate is 31%, then you do 1597.1 + .31 * 800 = $1,845.1. That's the total that you're paying with tariff.

As @sparechange said - you'll get a bill later. He's in Canada so might be different. In the U.S., you might have DHL send you a bill 6 months down the line. The bill will be for the declared value x tariff.

Sometimes you squeeze through the cracks... but I wouldn't count on it. Budget as above.

I too haven't used DHL in years, but I do remember getting bills very shortly after entry, don't think I got anything months down the line.

Good point on the antidumping duties--these are much more punitive than customs duties. I've always found it difficult to find exact info, but the closest I've found was http://web.ita.doc.gov/ia/CaseM.nsf...e782!OpenView&Start=1&Count=30&Collapse=28#28

It's very poorly organized, but better than nothing. Whatever you select, make sure you keep on clicking 'next' at the bottom. Some of the duties are very specific, and apply only to a narrow set of products, even certain named suppliers. And you have to look at the basic level product description-- for example, if you're importing notebooks from China, those are listed as "Lined Paper Products", something which can easily be missed, and next thing you know, you get a bill for 253% antidumping fees (so you pay 2.5 times as much in fees as the product value)

Also, as @AgainstAllOdds mentioned, this will not cover anything that is still pending and not ruled on yet.
 

Walter Hay

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The safest way to avoid anti-dumping penalties is to check with a Customs broker first.

Assuming you use a local freight forwarder, ask them if they have an in-house Customs broker. If like most forwarders they have, ask them to advise whether your product X is subject to anti dumping rules.

Walter
 

ItsKaryn

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@AgainstAllOdds wow, thanks for the info. This was very helpful.



Yes, I am located in the US.

This is what i was nervous about! Getting a bill 6 months down the line!? Why can't i just get the bill immediately so i can pay it off and get it over with. This makes it very complicated imo. But you'll probably get use to it huh?




So my total cost would be $1,845.1 with tariffs. Divide that by 100 units, that leaves me with a $18.45 product. If i Sell for $35.00 that would leave me with a profit of $16.55 then minus all of the fees/shipping ill probably be left an estimate of $10.00 take home

Sometimes I wonder if its worth all of the work for such a small profit, but the game is won by death of a thousand cuts i assume...

don't forget other operating costs and income tax
 

P3HSB

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I'm still having trouble figuring this out, as a small time importer who is trying to get started, and it is very frustrating

Why do i feel like anything that is 1-5 MOQ, 1-10MOQ, 50-100 MOQ is almost unprofitable. Ironically these are the MOQ small time players are looking for to get started with. Obviously with scale you can reduce your cost per unit.

But for someone who is trying to get started, it almost appears like you have to go negative profit and take a lost on your first shipment??

Yes you can value skew your product and charge more to the customer, but at some point it just gets ridiculous, like how am i suppose to sell a cheap Chinese generic looking "rug" for $50. What am i missing here?
 

Ronak

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Most of those tend to be middle men and not the actual factory.

I would look into @Walter Hay book for guidance on how to go direct and find small order suppliers.

Also, you cant run a business off of ordering 1 to 5 pieces, those are sample orders, which are normally higher priced. After you find the real factory, do a test order of a decent amount (after seeing samples), even at a loss, assuming that you can turn a decent profit at higher volume orders.
 

Walter Hay

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Most of those tend to be middle men and not the actual factory.

I would look into @Walter Hay book for guidance on how to go direct and find small order suppliers.

Also, you cant run a business off of ordering 1 to 5 pieces, those are sample orders, which are normally higher priced. After you find the real factory, do a test order of a decent amount (after seeing samples), even at a loss, assuming that you can turn a decent profit at higher volume orders.
@Ronak is quite right. You are dealing with middle men. Genuine manufacturers don't offer such small MOQs. As he says my book will show you how to go direct to real manufacturers, and how to get them to accept a sample order much smaller than the huge MOQs usually quoted.

@P3HSB You have been dealing with Alibaba.com Logistics and that means you are at the mercy of Chinese forwarding companies. Find a forwarder in or near California to quote you giving options for you to choose from.

It is obvious that you are a total newbie so if you don't want buy my book, at least read through my AMA Sharing my lifetime experience in export/import. Product sourcing specialist. It's only 61 pages but it will at least give you some of the essential knowledge before you throw money away.

Walter
 

inputchip

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Assuming you're in the U.S., here you go: Harmonized Tariff Schedule Search. Figure out how to use that.

Once you have that, take that number and then look at the attached list. Use the attached list to see what percentage you add on. This is your tariff rate.

Let's say your tariff rate is 31%, then you do 1597.1 + .31 * 800 = $1,845.1. That's the total that you're paying with tariff.

As @sparechange said - you'll get a bill later. He's in Canada so might be different. In the U.S., you might have DHL send you a bill 6 months down the line. The bill will be for the declared value x tariff.

Sometimes you squeeze through the cracks... but I wouldn't count on it. Budget as above.

@AgainstAllOdds, can you explain to me what the document is that you attached? Are these additional duty rates that are applied on top of the duty rates specified in the Harmonized Tariff Schedule? Are they just specific to importations from China?
 

wondercrew

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I have never ordered anything from alibaba, but I always shop from aliexpress and I think that these two are quite similar. So I think that the shipping price is too high. Most probably seller set a low price to attract attention and the actual price of a good is higher, but the shipping is cheaper. That is a famous trick that sellers use. So when I shop I use the https://alitools.io/en. Helps to track the best prices and sellers. I have never been got fooled after I installed it.
 
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Walter Hay

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Hi, I have the same problem. I do not know how to resolve it too.
If you read this entire thread you will get some idea of what issues are involved in relation to costs of freight, duty etc.,

Reading all of my AMA thread Sharing my lifetime experience in export/import. Product sourcing specialist will help you a lot more, but remember that the thread was started nearly 7 years ago, so a lot of the older posts are now well out of date.

The international trading scene changes frequently, and that is why I revise my book every year. The 2021 edition is up to date, unlike the many blogs online published by people who claim to be experts.

One example is a blog that states that it was updated in November 2020, but it quotes Alibaba information published by Alibaba in 2018.

I suggest you at least check out the contents list on Page 1 of my Walter Hay's Business Books

If you have any questions, post them in my AMA thread and you will get accurate answers.

Walter
 

MitchC

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Since this thread has been bumped if anyone else is reading it I’d like to add that it’s worth it to get a sample from a bunch of different suppliers. Even if it is the exact same product design and photos as another listing, the quality and also the service from the supplier can be vastly different.

also it’s worth working out if a supplier can grow with you early on, as in offering customisations with a reasonable MOQ and price because if you are going to want to do that later on it’s going to be better to do those bigger and more expensive deals with someone you have already worked with and know is reliable.
 

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