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GOLD! Sharing my lifetime experience in export/import. Product sourcing specialist.

Discussion in 'Product Creation, Inventing, Importing, Sourcing' started by Walter Hay, Sep 17, 2014.

  1. MoneyDoc
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    MoneyDoc Gold Contributor FASTLANE INSIDER Speedway Pass

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    One thing I noticed on this forum and with people in general is that they know what importing is but they don't know how to reach the manufacturers, how to professionally contact the manufacturers, which payment method to use, etc. Make's me think of a fastlane opportunity here... I have a perfect domain name too..
     
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  2. MoneyDoc
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    MoneyDoc Gold Contributor FASTLANE INSIDER Speedway Pass

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    Anyone in China that offers you and iPad for $56 is not a legitimate person. Just forget those suppliers entirely.
     
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  3. Walter Hay
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    Walter Hay Legendary Contributor FASTLANE INSIDER Speedway Pass LEGENDARY CONTRIBUTOR

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    You are tempting me to engage in some self promotion by telling readers that I have already done what you are thinking of doing. Oh well.....

    No matter what you publish, the majority of people seem to prefer to listen to suggestions by amateurs. I find that even some Fastlane members seem to think that they can learn all they need to know about a subject by asking a few questions.

    A post by jpmartin in the thread: 'Mindset, Motivation, Choices' started by xabi, Oct 3, 2014, that I thought summed it up well said: "If you think education is expensive, try ignorance."

    I have seen so many people get burnt in importing when they could avoid that with some real education on the subject.

    Good luck with your new opportunity.
     
    Last edited by a moderator: May 6, 2018
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  4. MoneyDoc
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    MoneyDoc Gold Contributor FASTLANE INSIDER Speedway Pass

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    Sorry, I should've been more clear.

    I didn't mean I was going to write an ebook or something. Rather a service.


    Sent from my iPhone using Tapatalk
     
    Last edited by a moderator: May 6, 2018
  5. Walter Hay
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    Walter Hay Legendary Contributor FASTLANE INSIDER Speedway Pass LEGENDARY CONTRIBUTOR

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    Thanks for clarifying the point.

    There could well be a place for someone with appropriate knowledge to do what you are thinking of. I am constantly receiving requests to mentor newbie importers. I can't handle that because of the time I devote to support my book buyers, but someone who wants to go down the mentoring route could do well in this field.
     
  6. Simon Ashari
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    Simon Ashari Bronze Contributor Read Millionaire Fastlane I've Read UNSCRIPTED

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    Doesn't this service already exist?
     
  7. PeeVee
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    PeeVee Bronze Contributor Read Millionaire Fastlane Speedway Pass

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    Even if it does exist, that's simply validation of the market. There could be room for competition.
     
  8. Simon Ashari
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    Simon Ashari Bronze Contributor Read Millionaire Fastlane I've Read UNSCRIPTED

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    Agree. I'm not saying someone shouldn't do it.
     
  9. Walter Hay
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    Walter Hay Legendary Contributor FASTLANE INSIDER Speedway Pass LEGENDARY CONTRIBUTOR

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    Yes there are many people offering their services as mentors for new importers, but there is clearly demand for the service, because as I mentioned, I am constantly receiving requests for such a service.

    There are two main keys to success if someone wants to offer such a service:
    1. Know the subject thoroughly.
    2. Establish a reputation as an expert.

    I have seen people offer their services as experts or mentors but they obviously only know what they have picked up from research rather than experience. I often see people posting misinformation on forums but they sound as though they are speaking with authority.
     
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  10. ddall
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    ddall continuous self-improvement Read Millionaire Fastlane FASTLANE INSIDER Speedway Pass

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    Walter,

    The value you have provided in this thread is excellent. Thank you.

    I have a question. I've imported 500 units of an item, and had them shipped from China to an intermediate inspection warehouse in the US before forwarding them on to Amazon FBA. 48 of those units (approx $600 worth of product) is damaged. Not the item itself but the packaging, which is high end, essentially has rendered the items non-salable. I think the manu did a poor job and protecting the product within the boxes. 10% damage rate seems high.

    1) What is a common course of action in this situation? Should I go hard on the manu and request refund? Ship it back at their expense for repackaging?Am I screwed? What advice would you suggest in these scenarios.

    Thank you.
     
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  11. Walter Hay
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    Walter Hay Legendary Contributor FASTLANE INSIDER Speedway Pass LEGENDARY CONTRIBUTOR

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    I am guessing that you did not have the shipment insured. In that case your only recourse is with the manufacturer.

    First, I suggest you take photos that clearly show the damage, and if possible showing all 48 units with damage in one of the photos.

    If this is your first shipment they will be wary of you, just as you might be of them. Approach them gently, not hard at first. Be very polite, and if possible give them a way to save face. Maybe you could say something like: "Perhaps the outer packaging needs to be stronger in future." I would not ask immediately for a refund, but would report the problem and ask them to suggest what should be done.

    Depending on their reply you will know what your chances are. I would be prepared to accept a discount on the 48 if there is any possibility of selling them minus the packaging, but don't suggest that until it becomes obvious that a full refund is not going to be given.

    Walter
     
  12. ddall
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    ddall continuous self-improvement Read Millionaire Fastlane FASTLANE INSIDER Speedway Pass

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    Thank you Walter. It was an air shipment and it was not insured. The manu and I have thus far had a good relationship, we have worked closely on designing this product. I think they likely packaged these poorly for the boxes to be so damaged. One solution I am hoping to implement is have the warehouse hold onto the damaged goods (at a small fee) and have the manu ship replacement packaging as soon as possible. Perhaps the manu and I can split the costs. Thank you greatly for your wisdom on this matter. Selling them individually will likely not work, they are highly branded and customized for sale on Amazon. I guess I could create a new 'refurb' listing and sell at a lower price just to offload and recoup costs but for my strategy I think it would be better to have the inventory repackaged and sent to Amazon under normal listing. I will take your advice and maintain a very polite interaction, with a mindset to ensure they can preserve 'face' in our dialog. Thank you
     
  13. Walter Hay
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    Walter Hay Legendary Contributor FASTLANE INSIDER Speedway Pass LEGENDARY CONTRIBUTOR

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    Your existing good relationship is a good starting point. This situation highlights the value of building those relationships and that can involve simple things such as friendly exchange of greetings at appropriate times without any reference to business matters.

    In addition to holiday greetings, an example could be to thank your contact for the prompt and helpful manner in which they have been dealing with your emails. Give them a warm and fuzzy feeling every now and then and it can work wonders. It can pay to treat your suppliers the same way you would treat your customers in order to maintain their custom.

    I agree with your approach regarding possibly splitting cost of freight on the replacement packaging. If you go the extra mile in this first problem situation, it will likely establish a good foundation for smooth handling of any future problems.

    Walter
     
  14. Walter Hay
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    Walter Hay Legendary Contributor FASTLANE INSIDER Speedway Pass LEGENDARY CONTRIBUTOR

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    Q&A 1

    I get a huge number of questions from individuals and have decided to share those that do not contain confidential information, such as specific products or suppliers. Those who rely on me for guidance would not appreciate it if I broadcast their niche or their perfect supplier's name.

    I will post a new question and answer periodically.

    Q: I have seen some great products that look almost identical to one of the well known brands, but they are unbranded. Can I buy these and put my own label on?

    A:
    Never ever try to import branded goods either for personal use or especially for resale.

    One thing often overlooked is that unbranded copies of big brand goods can also land you in big trouble. Designs are copyrighted, so if it looks even almost identical to the real thing it is illegal to buy or sell it. The differences in appearance might make you think that it does not infringe copyright, but is it worth the risk of losing all your money, a lawsuit, and possible fines?

    A second point overlooked is that rebuilt, renovated, repaired, or refurbished genuine branded goods can also land you in deep water. One of the reasons is that in virtually every case, the parts used for the refurbishment will be non-genuine, but the main reason is that Customs in every country have automatic alerts that flag anything with those brands, so even a single refurbished item is likely to come to their attention.

    You will never win an argument with them about the goods being second hand, and do you want the hassle and likely loss of your money anyway? Once you have come to the attention of Customs, even if you were not committing an offense, chances are all of your imports will be delayed from then on.
     
    Last edited: Oct 21, 2014
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  15. 1step
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    1step Gold Contributor FASTLANE INSIDER Speedway Pass Summit Attendee

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    I was working on shipping terms with a manufacturer and he said that if I wanted to do a bank transfer that the shipment could only leave the country on a boat (no air freight). Is this some kind of limitation placed on some manufacturers? Can you clarify if this is legit?
     
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  16. Walter Hay
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    Walter Hay Legendary Contributor FASTLANE INSIDER Speedway Pass LEGENDARY CONTRIBUTOR

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    Any person exporting goods from China can choose either air, sea or road freight. He obviously does not want payment via bank transfer! I expect that his next move will be to ask you to pay via WU.

    There is no conceivable legitimate reason for his statement. I suspect that he is probably not really a manufacturer, and I think there is a high risk that he might scam you.
     
  17. raynoldcj
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    raynoldcj Contributor Read Millionaire Fastlane

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    Great thread!!
    About your book... When is the last time you updated it?

    Is it still version 14.1?
     
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  18. Walter Hay
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    Walter Hay Legendary Contributor FASTLANE INSIDER Speedway Pass LEGENDARY CONTRIBUTOR

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    No there is a second revision for 2014, so the current one is 14.2. I usually revise it twice a year to ensure that it is always up to date.

    I am currently reviewing it and expect to release a new edition in early 2015. All book buyers have free access to updated versions whenever they become available.

    Walter
     
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  19. raynoldcj
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    raynoldcj Contributor Read Millionaire Fastlane

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    Thanks for the info Walter. But I'm afraid I can't access the site :)
    Hope you can help .

     
  20. Walter Hay
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    Walter Hay Legendary Contributor FASTLANE INSIDER Speedway Pass LEGENDARY CONTRIBUTOR

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    @raynoldcj, I hope your question doesn't get me into trouble, but if clicking on the link in my signature doesn't work, just start a conversation and I will give you another live link.

    Walter
     
  21. ljb7
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    ljb7 Bronze Contributor Read Millionaire Fastlane Speedway Pass

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    Walter,

    Thanks for contributing some great value to this forum.

    When you source a technical product from a supplier, for examples sake let's say I source colour changing LED flood lights, do you try to get the suppliers 1 year warranty in writing?

    How would you go about this to ensure you have the best chance of receiving a replacement item if your customers item turns faulty?

    Or alternately do you just stand no chance getting a replacement? I realise it will vary greatly depending on the manufacturer as well as other points to consider, but I just wanted your opinion on the matter.

    Thanks.
     
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  22. Walter Hay
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    Walter Hay Legendary Contributor FASTLANE INSIDER Speedway Pass LEGENDARY CONTRIBUTOR

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    Unfortunately there is not much point in getting such a warranty in writing, although as a formality it may have some value. Contracts (and a warranty is a contract) are extremely difficult to enforce in China.

    Even if a business in China were to agree to a contract with a clause making it enforceable in a court of law in your local jurisdiction, there is no way you could force an unwilling party to abide by such a clause.

    Your best warranty is a good relationship. Chinese people put a lot of value on their word and if you have established a good relationship so that they will also be satisfied that they can rely on your word, you will find that warranty issues will be handled without any problem.

    It is worth telling any prospective supplier at the beginning of your communication with them that quality is important to you. This will not necessarily result in you paying more, although sometimes it will, but it will often weed out those suppliers who do not stand by their products.

    There are many factories that manufacture to two different quality standards. I have been in factories where one production line puts out trash quality to satisfy the extremely low cost demanded by some customers, (often big retailers,) and high quality for those who want repeat customers. It would surprise most people to know how small the price difference can be, but if a big retailer is buying a million items that they are paying maybe $2 for, 10c = $100,000.

    During the time I ran my importing business I developed those good relationships that I recommend building, and before long, warranty issues were resolved by my word about a problem, sometimes backed up with photographs. Rarely did I or my franchisees have to return any items to China.

    Until you have built that relationship, and indeed as part of that building process, you wear the problem, but you do mention it politely. If you don't adopt a demanding attitude a supplier may well volunteer some compensation, usually by way of a small discount on the next order. If they can see that you are not trying to take advantage of them, they will chalk that up as a point in your favor.

    It is easier for you to accept some losses due to warranty issues if you buy at the right price, but that is another story.

    Finally, don't forget that trust works two ways.

    Walter
     
  23. ljb7
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    ljb7 Bronze Contributor Read Millionaire Fastlane Speedway Pass

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    Perfect answer, thank you very much.
     
  24. Walter Hay
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    Walter Hay Legendary Contributor FASTLANE INSIDER Speedway Pass LEGENDARY CONTRIBUTOR

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    Alibaba and the 2236 thieves.
    There is so much about Alibaba that has been published but is not known to most people unless they read financial news, so I thought I would add a link to a news item from the Economist headed: Alibaba and the 2236 thieves. See the link below.

    I know that this news item is now a few years old, but the Gold Supplier system is unchanged, so I believe the report still has value to those who have not seen it before.

    For those who don't want to read the whole article, here is a small extract:

    "Alibaba, China's leading e-commerce platform, faces the same challenge, but more so. It operates in a country where fraud is rife. And it has grown at a dizzying pace: 56m people use its business-to-business website, it claims, and 370m use Taobao, its online mall. This week it ran into trouble. On February 21st, in a filing with the Hong Kong Stock Exchange, Alibaba admitted that it had granted “gold” status (a mark of supposed integrity) to 2,236 dealers who it says subsequently defrauded buyers."

    Two of Alibaba's senior executives at the time resigned in the usual Asian way of "accepting responsibility” which is in effect an attempt at taking the heat off the company.

    In my opinion the situation was made worse when Alibaba discounted their Gold Supplier fee from $2990 to $299 for most of last year. This resulted in a flood of new Gold Suppliers on the site, but readers should realize that Gold Supplier status has always been bought, not earned.

    It is worth noting the Economist's comment about Gold Supplier status: "(a mark of supposed integrity)" In emails that I have received from Alibaba they state that one of the reasons for becoming registered as a Gold Supplier is:

    “6. Buyers trust you because your company is verified by the credit agency.” That credit agency verification is performed as part of the “Onsite Check” which happens to be identical to the onsite check for ordinary Verified Suppliers and is almost identical to the A&V check. Here is a cut and paste from Alibaba’s site regarding that process:

    “Onsite Check is a verification process for China Gold Suppliers. The supplier’s company’s premises are checked by Alibaba.com’s staff to ensure onsite operations exist there. The suppliers’ legal status and other related information are then confirmed by a third-party verification agency.” What this all amounts to is that regardless of the badges displayed the only thing you can be sure of is that the business actually exists and at least has an office that they may have rented for the day. Does that reassure you?

    There is an exception and it is the Supplier Assessment which is identified by a red tick in a blue circle. The report is lengthy and should be read in its entirety if you want to know if the supplier really is a manufacturer.

    Here is the link to the news item: http://www.economist.com/node/18233750

    Please don't think I am just knocking Alibaba. Almost all of the major B2B sourcing sites use a similar system.

    TOPIC HEADINGS PREVIOUSLY POSTED IN THIS THREAD:

    Introduction. Dealing with myths and misinformation.
    Some things you should know or do before you start product sourcing.
    Traveling to source supplies. Do you need to visit China? Trade Fairs.
    The difference between Alibaba and Aliexpress.
    Traveling to China to visit factories.
    ■ Do your suppliers use child labor or slave labor?

    Q & A 1
     
    Last edited: Oct 22, 2014
  25. tak
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    This is an amazing read. My issue is actually finding legitimate suppliers on Alibaba. One of the things that I've read, is to read their company profile and go for those who have your desired product in their name, and are listed as manufacture in the business profile. Like " Hengxing Speakers Aung Co., Ltd. "

    Do you find that this holds true?

    Another thing is, I've found many suppliers who are listed as a "Manufacturer, Trading Company" Which leads me to believe they don't make the products they claim to say they do. I'd assume that real manufacturers would just be listed as "Manufacturer"

    Also someone once said that if they claim to make other types products then they are not a manufacturer. Example) you look for a company to produce portable speakers, and you see that they make tablets, cell phone cases, key chains, and usb cords.
    --
    I feel like I may have been dealing with traders this entire time..their MOQ is usually pretty high, around 100-200. Their response " Due to high demand, we are not able to provide less than our MOQ" One said they accept an moq as low as 24, which is extremely doable. Any thoughts on this?

    So far it seems like to make sure that they are a legit Manufacturer is to
    1) make sure they have the Supplier Assessment icon next to their name
    2) Forget about the gold status and just read the assessment reports
    Any key traits or points of interest we should be looking into on the assessment report. I've read it, but part of me doesn't fully understand what am I looking for.
    --

    As of right now, I've narrowed down the list to a few companies that Im planning on doing business with, but in the back of my head I still can't shake the feeling that im dealing with a trader. Whats a B2B source you'd recommend besides Alibaba? I've found a site called www.hktdc.com whats your take on that?

    --

    I know it s a lot but thanks a ton for this useful information. Its gonna help save us time, and a whole lot of $$ in the long run.
     
    Last edited: Oct 22, 2014
    bilkar1985 and ShannaGrace like this.

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