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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. Jimmy999
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    Cheers, that's a real bummer. Adding on 25% costs makes a lot of the products I'm looking at unviable.
     
  2. Walter Hay
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    Walter Hay Legendary Contributor FASTLANE INSIDER Speedway Pass LEGENDARY CONTRIBUTOR

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    Maybe this needs more explanation. The raw materials are only subject to tariffs when imported as raw materials.

    The raw material component might affect the tariff rate, but that rate is determined primarily by the type of product.

    For example a tool might be made of aluminum, but would not be subject to tariff as aluminum. It would be assessed as a tool.

    Hope that helps.

    Walter
     
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    You're right, that's where I'm confused. My product is steel. Under the tariff list from today, 7326.90.86, it states, iron or steel, articles, nesoi.

    The wording makes it sound like a blanket rule covering anything iron or steel. Although I'm not sure why they bothered listing all the other steel and iron codes.
     

    Attached Files:

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

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    I doubt that you will find anything but industrial type products such as chains, pipes etc.
    If you want to search for you specific product in that massive list, open the PDF file and type Control F.

    Then in the search panel that appears in one corner of the screen type in the product that you want to import. You might need to keep clicking your way through the document. If your product is not there you have no worries.

    Walter
     
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  5. Jimmy999
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    Jimmy999 New Contributor

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    Looks like steel is back on the menu.
     
  6. YoungPadawan
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    YoungPadawan Miles to go before I sleep Read Millionaire Fastlane I've Read UNSCRIPTED FASTLANE INSIDER Speedway Pass

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    Hey Walter, excellent thread (and book).

    I'm looking at importing a product part and I only found 2 reputable suppliers on the made-in-china.com website according to the instructions that you had outlined in your book on vetting suppliers.

    I would like to get additional quotes, and the particular product part that I'm looking to import is part of a larger product. There are quite a few suppliers of the larger product that I found on the hktdc.com website and I'm going to ask the manufacturers to just supply me that specific part, although it may take a little bit of customization.

    I was just wondering: if a supplier says that they only sell through the specific website that I found them on, should they be trusted? Similarly, if a supplier hasn't been to trade shows, should I assume that they are scammers? (Whether they're found on the hktdc website or alibaba or made-in-china etc.)

    Many thanks!
     
    Last edited: Sep 19, 2018
  7. Walter Hay
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    Walter Hay Legendary Contributor FASTLANE INSIDER Speedway Pass LEGENDARY CONTRIBUTOR

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    It is not unusual for suppliers to only register on one B2B site, so if they want to only deal with you through that site I see no problem unless it is a site such as DHGate, ec21.com, and others that have terrible records as you can find by seraching such places as Ripoffreport.com.

    Bear in mind that to get a listing with at least a badge indicating that the business is trustworthy even if they are scammers, can cost thousands.

    Walter
     
  8. LPPC
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    LPPC Bronze Contributor

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    Hello Walter,

    I was curious to your advice/opinion on this one. I have 4 potential suppliers for a particular product.

    2 of them are certainly manufacturers of this particular product. One of them has verified reports (TUV or SGS inspection) on their production capacity for this product specifically and even provides free logo branding and the other has many indications that they are producing this product themselves.

    The 2 others are verified manufacturers too, but in their inspection reports there is no mention of manufacturing tools/machines for this product specifically. So they might be manufacturers for other products and just trading this particular product. One of these suppliers is the cheapest of them all ($1 cheaper per piece) and the other provides a shipping option that is very attractive because the shipping time is 4 weeks instead of the 6 weeks (better for cash flow) that the other manufacturers and freight forwarders can provide.

    Now I could ask the 2 manufacturers/traders for pictures of their machinery/tools as evidence of them being manufacturers, but you never know whether they are speaking the truth. Let's say they can provide these pictures, would you choose these manufacturers because of their lowers costs and attractive shipping options instead of those that are surely manufacturers (for example they have verified production capacity reports)? Or would you choose one of the two other manufacturers because you can be sure that they are manufacturers?

    A possibility could be that the ''non-manufacturers'' are giving me low prices as a lead so I become a customer and in the next shipments not give any discounts that a manufacturer on the other hand can offerd to give. Does such a lead magnet get used often in China?

    Sorry for the wall of text! I tried to keep it short.

    Much love!





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

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    @LPPC I suggest that before deciding, it would be worth doing a thorough Google search for those companies, and see what more you can find out about them. You might need to search a minimum of 5 pages

    Manufacturers often have a trading division and it makes it difficult to be sure which product they actually make and which they resell.

    If you know what machinery is needed to produce your product, and they have that equipment, as you suggest, that should be proof. The problem with that is that they could use photos from any source and not have the machinery themselves.

    The only way to be certain, other than visiting the factory yourself, is to pay an inspection agent to do a limited factory audit. Cost should not exceed $200 if you only ask for proof that hey manufacture product X.

    Walter
     
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  10. LPPC
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    LPPC Bronze Contributor

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    Thank you for the response and advice!

    I will do a Google search for these manufacturers. For now it seems like it is safest to go with the ones I am sure that they are manufacturers, even though the others are cheaper or have better shipping options.

    Is it maybe an option to ask what freight forwarder this particular company is using? Or will they find it rude or something?
     
  11. Walter Hay
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    Walter Hay Legendary Contributor FASTLANE INSIDER Speedway Pass LEGENDARY CONTRIBUTOR

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    I would ask.

    One of the many problems in using Chinese forwarders is their tendency to be slow in shipping, quite often a result of transshipping with long delays waiting for a flight or ship that suits their budget.

    Walter
     
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  12. LPPC
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    LPPC Bronze Contributor

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    Thank you for the quick response Walter.

    If for example a Chinese freight forwarders says shipping takes 4 weeks, then often it actually takes more time than that? Meaning they quote you faster shipping times than the reality?

    You have warned us against using Chinese freight forwarders and I am taking that warning seriously. But I guess we can trust Chinese forwarders that the manufacturer themselves are using or Chinese freight forwarders that for example my friend in a different country (Germany) is succesfully using? I myself want to import in The Netherlands.
     
    Last edited: Sep 25, 2018
  13. Walter Hay
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    Walter Hay Legendary Contributor FASTLANE INSIDER Speedway Pass LEGENDARY CONTRIBUTOR

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    Some Chinese forwarders will deliver on time, but I was referring to a common practice that results in delays. Those delays are most often due to shipping operating according to the forwarder's profit potential rather than the importer's needs.

    The only way to be confident is to check out references, reviews, or testimonials of any that you are considering.

    The manufacturers might not be using a suitable forwarder. That is why I said I would ask the manufacturer to name the one they had chosen. That way you can do some due diligence on them.

    It is probably worth taking notice of a recommendation from your friend in Germany.

    Regards,
    Walter
    P.S. If you use that forwarder it could benefit others if you post the results after you receive the goods.
     
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  14. LPPC
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    Hello Walter,

    I don't know why, but I haven't thought of checking reviews online. I thought none were available because it is on the subject of freight forwarders. I will definitely look into it.

    I have gotten quotes from several Dutch freight forwarders so far, so I am not exclusively considering Chinese forwarders. I just want to weigh the options.

    Do you know whether (Chinese) freight forwarders that are members of FIATA (fiata.com) are credible because of their membership?

    Yes it would be definitely of value to the members here, I will do that! Maybe even open a progress thread on here.

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

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    I would be confident in using Chinese members of FIATA, but check with the association first to make sure they are current members.

    It is simply a matter of searching for their name on the FIATA site.

    Walter
     
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  16. LPPC
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    Thank you Walter. They indeed have a members directory on their website.

    +rep
     
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  17. Walter Hay
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    Walter Hay Legendary Contributor FASTLANE INSIDER Speedway Pass LEGENDARY CONTRIBUTOR

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    BEWARE of foreign companies with LLC registration!

    There are a large number of foreign owned businesses that for the purpose of beguiling potential users of their services (and sometimes their products) register an LLC in the USA.

    This gives the impression that they are a US corporation, when in fact all of their business might operate outside the US.

    I am particularly concerned about Freight Forwarders, because as I have written in my 2018 importing book revision, there has been a huge growth in freight scams. In many cases, the fake forwarders are setting up high quality websites and using forged or totally invented documentation to establish their validity.

    They go much further than that, with highly convincing forged shipping documents. For details on how those scams work those who have my book can read Ch. 4.2

    I have frequently warned of the need to be very cautious if using Chinese freight forwarders, but scammers in other countries have entered the business, including ones from Russia.

    I was recently referred to a Russian logistics company that have a website indicating that they are an LLC. NOTE: a Russian LLC is identified as an OOO, but this one reads LLC.

    Not only does their website look highly professional, but another LLC by the same name operates a Shopify dropshipping site with only an email contact, selling knockoffs and they refuse to issue refunds or accept returns. It is typical of the dropshipping sites promoted by a Russian who has a huge business selling courses on how to dropship.

    I would be very wary about using Russian forwarders or forwarders in any other countries where the rule of law is weak.

    Walter
     
    Last edited: Oct 3, 2018
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  18. Jimmy999
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    Not wanting to seem like a complete beginner with the supplier, is it normal for them to not include how many pcs in a carton? Also carton dimensions? Is there a standard, or should I be asking these questions?

    Also, since I won't be ordering my product in large quantities, I'll be using an air courier like dhl/ups, should I be asking for EXW or FOB? My guess is EXW since the courier should be picking it up from the factory?
     
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  19. Walter Hay
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    Walter Hay Legendary Contributor FASTLANE INSIDER Speedway Pass LEGENDARY CONTRIBUTOR

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    It would be normal for them to automatically tell you how many pcs per cartons, but they are often lazy when it comes to giving full packaging details.

    In particular they might tell you the weight of each parcel, but not the dimensions, and without dimensions to include in your request for a freight quote from your forwarder you could be in for a nasty shock.

    Dimensional weight often far exceeds weight in lbs or kgs.

    If using a courier I recommend first asking your supplier to quote you including door to door air courier service. They will often get a bigger discount than you could negotiate and they will (should) pass on a reasonable part of that discount to you.

    If air couriers are used, the Incoterm should be either CPT (Carriage Paid To) place which would be your address or CIP (Carriage and Insurance Paid to) place. Again, this would be your address.

    In practice, door to door air courier delivery is almost invariably DDP (Delivered Duty Paid) with destination your address, because the couriers clear through Customs for you, paying duty and GST/VAT as required and they get you to reimburse that before the deliver to you.

    I don't recommend requesting DDP because it tends to scare many suppliers who thin it makes them liable for payment of duty.

    Walter
     
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  20. Tiago_Matos
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    Tiago_Matos New Contributor Read Millionaire Fastlane I've Read UNSCRIPTED

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    Hello Walter

    I've got both of your books about sourcing products and private labeling, they are great sources of real unique information. Thank you so much!!

    I sourced a product and contacted around 40 potential suppliers. After extensive verifications of their information (I checked everithyng possible about them).
    I would say that only 3 of them are real manufacturers. The rest are trading companies.

    By the way, this verification process took me a lot of time, but I am sure it will pay off.

    Now I started talking about samples. I asked for a quote of courier door-to-door and they replied with the shipping costs on the e-mail: $45 -$50 courier. They accept Paypal.

    Can I consider this e-mail as a firm quote in writing and go ahead with the samples?

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

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    Thanks for your kind comments.

    Yes that would be considered a firm quote, but you should email back and confirm the sample order setting out all the details of price, courier charge and that it is for door to door delivery.

    Walter
     
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  22. giovanni93
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    giovanni93 Contributor Read Millionaire Fastlane I've Read UNSCRIPTED FASTLANE INSIDER

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    Hi Walter,

    I started reading this thread last week and just finished up your book last night, both have been incredible resources!

    Anyway, honestly, I started reading this thread then your book just out of intrigue, so I'm starting kind of backwards rather than having found a need for a product then looking for a supplier like you did, but I was wondering what do you believe is the best ways of finding a product that may be in need that can be imported? I believe you discussed it a bit in this thread about possibly searching for things that are within my realm of expertise/interest then going from there. If you already mentioned this point earlier in the thread, I apologize, couldn't seem to find it.
     
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  23. Walter Hay
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    Walter Hay Legendary Contributor FASTLANE INSIDER Speedway Pass LEGENDARY CONTRIBUTOR

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    Your backwards approach is not without benefits. At least you will know something about importing before you start looking for a product to sell.

    Finding a product to sell.

    The usual way to find a product to sell is to research keywords for demand, and if possible find products that are frequently searched but are not found easily for sale.

    A method that I like, because it has worked for me is to concentrate on finding problems.

    These include cases in which there is a problem that people meet and there is no product that fixes it, or it can often be complaints about the product, or complaints about difficulties in obtaining the product or parts, or even complaints about the lack of service from the suppliers.

    This last one is more likely to be encountered when one supplier is the only one offering the product or maybe has the lion’s share of the market.

    Keep your ears open for people grumbling about a problem that needs solving. You should think about your hobbies, trade or craft ability, or general work experience, even the hobbies or work experience of relatives and friends. If you have a hobby, are there things that you have wanted or needed but it was hard to locate supplies? Are some things obviously overpriced? Do the suppliers give good service?

    The same applies to trades, or industries, and if you can find things that are frequently bought, you may have found a market. That would certainly be the case if those products are often late delivered, or seem overpriced, or are hard to find.

    Once you think of something check that it is not being offered by lots of sellers on Amazon or eBay. If there are a few sellers, check their prices. If it is a big ticket item that may give you an opportunity because many sellers buy from wholesalers or dropship suppliers, and so they have to work on very small margins.

    Be sure to learn everything you can about the product. That is where hobbies are a good starting point because you will usually know how the product works and why people would buy it.

    It is important to know what your selling costs would be, including your Amazon or eBay or PayPal fees, advertising cost, and postage to your customer. You also need to know your landed costs and for that you can use the method that I have set out in my book.

    You might find that when you start offering a product at a lower price than other sellers they will cut their price to keep you out of the market. Keep that possibility in mind when calculating how much you can afford to pay your suppliers.

    Rather than enter the market with your USP simply being a low price, consider building a high quality brand image, using the comprehensive method I describe in my power labeling book. But… even the best labels, logos, etc., can’t make a poor product succeed.

    Once you have worked out the maximum amount you can pay for the items, start contacting suppliers and obtaining quotes. Be patient and get quotes from as many as possible. Make sure the suppliers are genuine manufacturers. Then follow my suggestions in the book about how to obtain samples.

    If you have found a real niche, it might be possible to specialize in one or two products and only sell those. If your margin is big enough you can make good money for less work that way, but I would still look for additional products preferably in that field, and at least have them as a fall-back.

    Walter
     
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  24. giovanni93
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    giovanni93 Contributor Read Millionaire Fastlane I've Read UNSCRIPTED FASTLANE INSIDER

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    Thank you Walter!

    That's incredibly helpful and thorough! I will take your advice, research, do my due diligence, and run with it.

    Giovanni
     
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  25. Vanderbilt
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    Vanderbilt Silver Contributor Read Millionaire Fastlane I've Read UNSCRIPTED FASTLANE INSIDER Speedway Pass

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    Hello Walter,

    I have general questions and would like to know your opinion on this!

    Which countries will benefit from the US/China Trade war?

    Which of these countries have almost as good infrastructure as China?
     

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