Wednesday, 28 November 2012

The Prosperous Merchant: How To Import From China

Favorable currency exchange rates and low labor costs makes Chinese suppliers of consumer goods an attractive trading partner for many a western retail business enterprise. China is by far the world's largest exporter of consumer goods. A large nation, it is in many ways still a developing country, especially in its vast interior. Because of this, it has an enormous work force where much of it is entry level and willing to work hard for wages that are favorable to employers. A good example of how dominant China is in this arena can be found in its relationship with the Wal-Mart corporation. Wal-Mart Stores Inc. is the largest retailer in the world, and recently has become the largest grocer in the United States. Most of what Wal-Mart sells it imports from China,and this created a trend. When other large retail chains discovered this,they too started importing much of their goods from China.

Prosperous Merchant Import China

As a merchant, you want to "buy low, and sell high". The deals offered by Chinese manufacturers are for some simply too attractive to pass up. Many fortunes were earned buying from China and selling to consumers in the West. However; because China is so far away, there are serious risks for merchants that want to begin importing Chinese manufactured goods right away. From 9,000 miles is it hard to know whom you can trust, and who is out to cheat you. Moreover, language and time zone differences don't make things any easier. Adding to this is monetary exchange rate matters, international banking issues, high shipping costs, and of course, taxes, and local customs laws. None of this should deter any would-be tycoon of average ambition, but the entire process demands a certain level of caution and due diligence before dives in over their head.

How To Import From China: Getting Started 
If you are interested in buying wholesale levels of imported Chinese goods, and you have not done so before, then perhaps your best course of action is to find somebody who already does import from China and arrange to buy from them. You would do this just to get a start in the business. By doing this, you will not earn maximum profits in your enterprise because you will be effectively buying from a "middleman" which makes you at best a distributor rather than an importer, but there are many advantages. With this type of arrangement you will earn some money because of the inherent pricing structure and competitiveness of imported goods. You will also learn a lot, and no price can be put on the education that you are likely to obtain. You will learn much about how your vendor sources their goods and how they go about making their buying decisions. You will learn what Chinese organisations are worthy of your trust. You will likely develop a sense of how volume purchases influence wholesale prices. Most importantly perhaps, you will learn a lot about consumer trends and their buying habits.

Beyond working with an actual importer, you will want to invest time learning about importing generally. You will want to develop an understanding about international trade and finance. It will benefit you to learn as much as you can about trade finance including, cross border credit card transactions and bank letters of credit. Most buyers of imported merchandise do not make a fully payment on the goods until after they receive them. To secure payment, the manufacturers and dealers of those goods cooperate with the buyers in the arrangement of credit facilities so that prompt payment can be made after the goods are delivered.

There is a great deal of information on the Internet related to the subject of How to Import From China. Unfortunately, much of this information comes from sources that have never actually done it. These are vendors of information, not people in actually in the trade. One needs to be very careful where they get information. There are quite a few good books in print, available either in the library or on your favorite online bookseller. A book you use to learn about the business is worth it if it was authored by someone who has actually worked in the business for more than a few years. Avoid books written by journalists and other folks who have not worked in the business for a living, but who have instead just reported on it.