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Sourcing from India

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Eddie Temple

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Looks like I am moving permanently to India.. my future wife is pregnant, and as she is Indian national we decided to call Mumbai home for the coming months and probably years.

It will be a completely different world for me, and now I have a pressure to come up with the income for the family, but anyways I am looking forward to the challenge.

Will be relocating there in the late April, and by that time I need to do as much preparation and research as I can, so I would appreciate any advice from experienced members about sourcing, import and export.

We will test the markets with small quantities of various goods, but right now I am overwhelmed.
Incorporation, payment processing, my legal status there, baby, new apartment...omg.

She is from the northeast of India, so doing biz with Myanmar is also in consideration, but let's see what happens.

I was thinking to start just by touring the factories, getting to know the products and people, buying small quantities and testing the markets..
Also I have to narrow down companies in Europe/Australia/USA that import from India, and try to get some deals going..

So, the question for you guys who spent some time in import/export.. what would you do? where to focus most of my time and money?
 

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Walter Hay

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Being on the spot in India gives you a decided advantage. Having a wife who is an Indian national adds considerably to that advantage, so how best to use your opportunity?

First you must decide whether you want to sell products via eCommerce. That would seem the best option.

Before getting started, you need to understand the Indian way of doing business. Your wife, and possibly her family can no doubt help you there. Haggling is a way of life in India, and you need to learn how to do it successfully.

You will see it in action in the markets, but it also prevails in business. The approach to haggling is what I call horse trading. Bargaining by way of ambit offers and counter offers can take a considerable time. Some of the medium size and bigger businesses have now begun publishing price lists, and that can be a great relief to newcomers to India. Just bear in mind that unless you have some way of comparing, you might not realize that those price lists can also be ambit offers.

When negotiating you will generally be wasting your time if you are dealing with a subordinate. You need to deal with the boss, whether it is a large or small business.

I would suggest that you study Indian business culture before trying to start any business there. There are many similarities between Indian business culture and the attitudes and behavior in other Asian countries. EDIT. A big difference is that whereas Chinese business people are willing to delegate. Indian bosses generally won't.

India is not the only place where I have been offered "special price, just for you."

Walter
 
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Eddie Temple

Eddie Temple

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Walter thank you so much for the reply! I understand it will not be easy..
Not sure how India is comparable to China, but I've read Tim Clissold's books(Mr. China), and his experiences are beyond insane, I guess something similar is waiting for me. I bet you have plenty of nice stories as well. But that's life, and what makes it interesting..

What niches would you avoid when starting out? E.g. difficult to export because of regulations in EU/US
And if I would approach companies in the west as a sourcing partner, what are the ways to build my credibility and get deals going? Besides having relationship with factories and just sending samples, how to make an offer they can hardly refuse?
 

Walter Hay

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India, just like China, is a mix of good and bad. That relates to both product quality and the behavior of businesses.

If you are considering working as a sourcing agent, you need experience. The best way to do that is probably by selling Indian products in the USA. This can be done from India via Amazon FBA, but in conjunction with your own eCommerce site. If you haven't burnt your bridges and still have a US bank account and address that will help.

There has been a great deal posted on the forum about using Amazon, and here is one that might interest you: Rant - Running Away From Alibaba and Amazon

There are plenty of others. Here's a very brief one: Amazon is Going to Slaughter Your Brand

As for product types to avoid, I would generally advise against handling electronics from any Asian source. India has a great textile industry, but quotas can apply, so that can make the process more difficult.

On a positive note, I suggest you keep your eyes open for products that have never been imported into the US. Don't just assume they haven't because you have not seen them on the market, but do some thorough research to determine whether they really are available in the US or not.

Credibility can be achieved by successful sourcing, and to get to that point you might have to offer free sourcing or very low cost sourcing in order to build up a clientele that you can quote.

I suggest that when the time comes you offer sourcing for small scale importers. Most expat sourcing agents will only deal with very large minimum orders.

Walter
 

Zedd9165

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India is a very tough place to survive at the moment. Where you will be paying almost half of your earning in taxes.

Make sure you find some good product to sell to the public and make good amount of money. Here business ethics are totally different when compared to EU/USA, so I suggest you have a trusted person who can represent you while meeting potential suppliers.
 

exporttoberlin

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Hi Eddie,

I am a diplomat in India based here for 9 months. I also have been planning to set out on International Trade and have been travelling, and talking to many people and observing the daily life. From my experience different cities offer different lifestyle and opportunities. For example I am based in Bangalore which seems to be of growing city with many middle and upper class citizens. There is of course a huge IT sector in the city.
It all may depend on what you may want to import/ export.

I wish I could help further with any niche products but I am also trying to figure out the needs. I believe taking a look at their target market and then Selecting the product might help.

Best wishes
 

Arun Siva

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mumbai is a hotbed but also a mess haha. you will see that as soon as you touch down.
the people are vibrant the city is huge there is myriad of opportunity in the Matunga, Navi Mumbai areas.

If i can be of any use please PM me. I have plenty of experience in many parts of india. whatever @Walter Hay says is 200% true. Indian way of business differs from REGION and STATE. what you will find out is that india is way too complex.

Mumbai is in the state of Maharashtra. The official language of india is english and hindi. however maharashtrians speak another language called Marathi. There are differences. Small things like this build on up.

culturally, there are distinctions between the north and south. India can be divided into three zones; North, South and West.

The North comprise of major cities like Mumbai (formerly bombay) Delhi, Punjab, Indore, Rajasthan, Lucknow, etc

West has cities such as Calcutta, Jamshedpur, (heavy bengali language influence)

The south region has a myriad of cities like Bangalore, Hyderabad, Chennai, Cochin) The southern states albeit 5 of them are all distinctively different. Each with its seperate language and people etc.

ideally, dealing with indians (due to the differences between themselves in terms of caste, language, diaspora, culture, region etc) is in itself a daunting task but we learn and grow and analyze each and every day.

However, as a foreigner, expect to dish out $$$ at every sublevel just to get information and answers. You can have all the information in the world but it still wont get you past the gatekeeper without "paying the toll". Its just how life works over there

burma myanmar are not ideal locations now due to political turmoil and conflict (look up rohingya muslim conflict ongoing) also the visa and immigration control is a mess going between the two countries. I would start by figuring out what to source first and then go from there; there are tons of exporters in india but i would say 70% are inexperienced in dealing with overseas continual shipments; The remaining 30% that do or even know the rules about it, of that maybe 25% are not up to par... leaving you with 5% that know exactly what they need to do. Finding these exporters in a country with 1.5 billion is a daunting task but manageable if you have a good network (which you can find on here or on the web or thorugh your wife's familial ties etc)

India is good for leather, textiles, handicrafts, raw materials dealing with granite,stones, metals. (not manufacturing however).
india has a lot of raw materials to offer; however again dealing with the bureaucracies is where your hair will turn grey and your blood will start to boil.

The indian port system is pretty good; major ports are situated near Mumbai and Gujurat (biggest in terms of outgoing cargo, logistic performance and tonnage) however there are two huge ports being revamped in southern state of Tamil Nadu.

Long story short you have options to get goods that you want to source from different regions effectively. (i know some good contacts for this)

The main thing here is, dealing (like walter hay stated) with the big dogs up top. (think Managing directors, directors, managers, the people that sign the docs and get the shit done) these people can vary so your people skills will be tested. They may be arrogant or they may just stall and stall etc).
If you are able to talk with the people in power that can call the shots then you should be fine. Be weary though that a lot of indians in cities are more inclined to help westerners and foreigners then those in the rural areas and villages. That is just basic mentalities of those people.
 
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Eddie Temple

Eddie Temple

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I am in Mumbai for 9 days already.
So far got a pretty good taste of how things work here.. from guys setting up the cable tv, buying stuff for the apartment which is like in a slum area of Kalina, ppl trying to scam me really blatantly, than people going out of the way to help me because I am foreigner. There is plenty of people being nice to compensate for those ripping you off, and that's great about this place.
Nothing has been easy so far, but I started to love this city.

Been to a few wholesale markets, but I need to take it easy and really learn how to negotiate here. This city is full of hustlers with lifetime of trying to get the best price for their products.

I will buy goods for like $150-$200 total, and try to sell through ebay and etsy, but markets here take days if not weeks or months to go around.
 

Walter Hay

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I am in Mumbai for 9 days already.
So far got a pretty good taste of how things work here.. from guys setting up the cable tv, buying stuff for the apartment which is like in a slum area of Kalina, ppl trying to scam me really blatantly, than people going out of the way to help me because I am foreigner. There is plenty of people being nice to compensate for those ripping you off, and that's great about this place.
Nothing has been easy so far, but I started to love this city.

Been to a few wholesale markets, but I need to take it easy and really learn how to negotiate here. This city is full of hustlers with lifetime of trying to get the best price for their products.

I will buy goods for like $150-$200 total, and try to sell through ebay and etsy, but markets here take days if not weeks or months to go around.
As you have found, India is a very mixed bag of attitudes. I have had some great experiences there, but they are greatly outweighed by the bad ones.

When negotiating, which in India is serious haggling, I have found the best tactic when the process becomes drawn out is to literally walk away. Whether in a business meeting in an office, or in a market stall, the result was almost always the same: The seller, sometimes a business executive, other times a stallholder, would hurry after me and offer a serious price.

If the negotiations are taking place with a businessman in an office, you should stand, shake hands with the top brass and announce that you are sorry that negotiations are not working so thank you for your time, but you have other people you must see. You might not even get past the door before you hear what you wanted to hear.

As for the need mentioned by @Arun Siva to hand out money for every bit of information or progress through the system, I refused to do that, and that is why I never exported to India. The "official" import duty rates would have made it impossible for an importer to succeed in re-selling my product.

It is a great pity that those with the wrong attitude have such short term vision, which is to their own detriment as well as to the country as a whole.

Walter
 

Arun Siva

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It is a great pity that those with the wrong attitude have such short term vision, which is to their own detriment as well as to the country as a whole.
this is where india lacks and will ALWAYS lack with lack of a better term thereof. The setbacks from "Short-term" selfishness supersedes any long term prowess. It is a sad state of affairs but nothing will change. We must just act and adapt accordingly.

When negotiating, which in India is serious haggling, I have found the best tactic when the process becomes drawn out is to literally walk away
with so many people in the country, trust me this is the ONLY way to negotiate. (unless you are going after a very specific resource that is small in quantities and found in only a certain region)
 

Arun Siva

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This city is full of hustlers with lifetime of trying to get the best price for their products.
bombay is just a microcasm of the rest of india. Most of urbanites in india are lifelong hustlers... Just too damn competitive. Feast or famine type mentality due to high populous.
 

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Bhanu

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Eddie welcome to India .
Here are few things I think will come handy to you :
1. If you are going to purchase something let us say a T Shirt . First check its price on an online platform like flipkart,Amaon india ,snapdeal etc. Then go to market and try to negotiate . Also dont buy from one place ..before buying anything go to 3,4 shops .This way you will know what would be the right price of product . Usually price of something would be anywhere between 50-75% of the price it is showing on the online platform.
2. Dont take Autorikshaw,Cabs rightaway ..make use of taxi hailing mobile apps like Ola,Uber .
3. Do not be critical when it comes to politics,religion,caste,race etc (this one is applicable to all the countries I think).
4. Dont drink water from outside. Always have bottled water .
5. Have patience as doing business in India is quite different and in some cases difficult than western countries .
6. Try to learn few words in local language ..we people love when a foreigner tries to speak in our language.

If I were in your place I would have done following :
1. I would have settled in either Gujarat or Himchal Pradesh not Mumbai .(No offence to fellow Mumbaikars ). Mumbai is too crowded and humid. Himachal is colder,cleaner,less croweded and more preferable. Gujarat is on par with western countries as far as services ,roads,electricity etc is concerned. (PS I am from Madhya Pradesh).
2. Interest rate on Money Deposited in banks here is quite good (6-9%). So I would have tried to earn 1 Crore rupees(around 1,50,000 Dollars) and placed it in Fixed Deposit account .This way I would have earned a good sum of 50,000 Rs monthly interest enough for living comfortably in Himachal/Gujarat (not Mumbai due to high Rent) .
3. I would have found something to sell online from India/or helped people visiting India. Here is my list :
a] Medical Equipment/Medical Tourism :This one is big .Just to give you an example heart Transplant in USA costs around 787,700 Dollars, in India it costs around 18 lacs INR (USD 28000) and goes upto 40 lacs INR (USD 62000). Price of sleep apnea machine in India is just half of what it costs in USA and so on.And we are as good as any country when it comes to medical field . You can help your fellow countrymen or westerner in this regard and earn money.
b] Clothes
c] Poultry product (Read about Kadaknath Indian breed of chicken.This one is unique breed of chicken because its blood,meat,eggs etc everything is pure black.It is found in Madhya Pradesh)
d] Hadicraft ,Indian ethenic clothings
e] I would have taught English in a coaching Class or started one myself. Again Indian parents want ('want' is a small word I would say ..desperately want)their kids to be fluent in English and if you can help I promise you can make great money.
 

Arun Siva

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Poultry product (Read about Kadaknath Indian breed of chicken.This one is unique breed of chicken because its blood,meat,eggs etc everything is pure black.It is found in Madhya Pradesh)
I really wish USDA would consider this to help both nations out.... because quite frankly more and more people here in the US are getting tired of tyson perdue etc big agri that are tainting our food supplies for profitization. THe health benefits from AYAM CEMANI / KADAKNATH are absolutely incredible... This bird deserves to be well bred and outsourced.
 

Arun Siva

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Eddie Temple

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I sold some cosmetics over eBay.. I can beat all the sellers with price, even though I have like 50 competitors, and still I can get 100%+ profit margin, buuut India Post doesn't allow shipping cream, they direct me to DHL, they don't allow it either. 50g cream...

in a few days I'm moving to Assam, will see how things go from there. there are plenty of opportunities here as long as you manage to overcome all the hurdles
 

AT112233

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I sold some cosmetics over eBay.. I can beat all the sellers with price, even though I have like 50 competitors, and still I can get 100%+ profit margin, buuut India Post doesn't allow shipping cream, they direct me to DHL, they don't allow it either. 50g cream...

in a few days I'm moving to Assam, will see how things go from there. there are plenty of opportunities here as long as you manage to overcome all the hurdles
how did you do on selling the cream?
 

Walter Hay

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I sold some cosmetics over eBay.. I can beat all the sellers with price, even though I have like 50 competitors, and still I can get 100%+ profit margin, buuut India Post doesn't allow shipping cream, they direct me to DHL, they don't allow it either. 50g cream...

in a few days I'm moving to Assam, will see how things go from there. there are plenty of opportunities here as long as you manage to overcome all the hurdles
I have never had the need for local deliveries within India, but maybe there are courier companies smaller than DHL and ones like them.

If so, shop around. You might find one that is willing to carry your product. I suggest you don't call it cream when booking a shipment. Instead call it cosmetics.

Walter
 
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Eddie Temple

Eddie Temple

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Walter Hay you are spot in, no one was willing to ship cause I said it's cream, and liquids are not allowed, so I had to take a loss on few I sold, and dropship them from another seller..
 

wildfox81

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I am in Mumbai for 9 days already.
So far got a pretty good taste of how things work here.. from guys setting up the cable tv, buying stuff for the apartment which is like in a slum area of Kalina, ppl trying to scam me really blatantly, than people going out of the way to help me because I am foreigner. There is plenty of people being nice to compensate for those ripping you off, and that's great about this place.
Nothing has been easy so far, but I started to love this city.

Been to a few wholesale markets, but I need to take it easy and really learn how to negotiate here. This city is full of hustlers with lifetime of trying to get the best price for their products.

I will buy goods for like $150-$200 total, and try to sell through ebay and etsy, but markets here take days if not weeks or months to go around.
Welcome to Mumbai.

Kalina seems like a hub for a lot of people coming from North-East India to work in Mumbai. Near to your area is BKC (Bandra-Kurla Complex) which is a big hub for businesses. Just take a drive through that area and you'll be impressed.

A lot of people in Mumbai will try to help you regardless of whether you're a foreigner or not. It's arguably the safest/friendliest metro city in India to live and work.

Mumbai will make you adapt to it pretty quickly. Life's really busy and fast here. And very crowded :)
 

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