How to Import from China?

As a Chaoshanese (referring to those people who were borns in the Chaoshan area in China), I’ve heard some words, like “you can always find a Chaoshanese around you”. This may be an exaggeration, but in real life, you can always find something that is from China. Your mug, your clothes, or the chair you’re sitting on, maybe they are “made in China”.

In fact, in many industries, you can always find a similar but more cost-effective alternative from China.

If you never purchase products from China, the below contents may be useful for you.

1. Why do you want to purchase from China?

Frankly, “Made-in-China” is more cost-effective, and you could make more money than purchasing from the Europe or USA.

A. Mature supply chains

China has very sophisticated manufacturing bases, and mature supply chains, which allows Chinese manufacturers could purchase raw materials at a lower rate.

B. Lower production costs

The “World Current Population” data on Worldometers.info shows that China is still the most populous country in the world, which brings a pool of labor for factories. Plus, most Chinese factory workers make lesser wages than workers in Europe and USA, lower wages mean lower labor costs.

C. Good services

Competition is like a tree, it’s growing every day. Many Chinese suppliers are intended to provide better services by shortening the lead time, extending the warranty period, responding more rapidly, etc, to stand out from other rivals.

D. High professionals

Many reputed companies (like B****r, P*****s, etc) have their manufacturing partners in China. In fact, “Good quality + having a professional team + appropriate price” is more attractive to them than a cheaper price.

 

2. Where to link with them?

In this era of highly developed information, we can connect with Chinese suppliers via these channels.

A. Exhibitions

In 2023, we believe attending exhibitions is the best and most direct way to connect with Chinese suppliers. Especially China has opened the “gate”, international traveling costs are more affordable than before, and many suppliers will attend these events and present their new products, and new technologies. You can talk to them, and test their products at the fair.

Blog - Exhibitions

B. Online

Although many Chinese companies have stopped investing in these B2B websites, but their information is still valuable.

At the same time, 90% of Chinese companies have websites to showcase their products, introduce their technologies, and publicize the events they will participate in.

Online Channel

C. Social Media

Many Chinese companies have marketing experts to run their social media, such as LinkedIn, Facebook, Tiktok, etc. There you can find them and connect with them.

Blog-Social Media LOGO

 

3. What is the best thing you should know before working with Chinese factories?

A. Common Trade Terms

The common trade terms are FOB, C&F, CIF, and EXW

From my experience, if this is your first time importing from China, FOB, C&F, and CIF are more considerable.

Under the FOB term, the supplier (seller) will be responsible for most of the costs (such as Customs Declaration Fee, Document Fee, Local Transportation Fee, etc) that happen before the cargo is loaded onto the shipping vessel. Buyers need to pay for the shipping costs, insurance costs, and destination charges and handle the customs clearance when the cargo arrives.

If C&F, then the shipping costs will be paid by the sellers too, and sellers are liable to make sure the cargo arrives at the port. Buyers pay for the insurance costs, and destination charges and handle the customs clearance when the cargo arrives.

If CIF, then the shipping costs and insurance costs will be paid by sellers, and sellers are liable to make sure the cargo arrives at the port. Buyers pay for the destination charges and handle the customs clearance when the cargo arrives.

These three terms will make suppliers (sellers) more liable. So, when calculating the FOB/C&F/CIF price, suppliers may use a relatively high coefficient. However, if you are familiar with the import procedure, or if you have a reliable shipping agent, the EXW term could save you a lot.

B. Lead Time

Generally speaking, standard orders will be shipped out sooner than special orders, as suppliers usually have standard goods in stock, and special orders need to customize.

For example, we usually have stocks for our standard packaging blood pressure monitors, so if you choose standard packaging, we can ship them out in 7 days (some time is 3~5 days). But if you want to change the language of the machines, or the packaging style, designing a new package and changing the sound source will take extra time. Therefore, the lead time will be extended to 20-25 days.

Besides, big corporations usually have stabler lead time, but it doesn’t mean they will be faster than small and medium-sized enterprises. In fact, because big corporations established very complete management systems, from order placement to production to final delivery, they need to go through multiple reviews, so their flexibility in delivery is sometimes not as good as that of small and medium-sized enterprises.

Lastly, some Chinese holidays, like National Days (10.01~10.07) and the Chinese New Year may delay the lead time.

C. Transportations

The choice of shipping method affects shipping charges, which in turn affects your cost. Obviously, if you want to minimize your costs, LCL is the best choice in most cases.

As you know, in the calculation of ocean freight, <1CBM=1CBM. Therefore, if you intend to purchase many products from China, shipping them in ONE shipment is considerable, and it may save you a lot.

D. Currency

In international transactions, US Dollar is one of the most common currencies. But in some certain circumstances, trading in RMB is acceptable too.

 

4. When you find the supplier, how should you contact him?

Wherever you find the supplier, you can leave a message, they will contact you in 1~2 day.

Generally, even if you just leave a “Hi”, they will contact you too. But leaving the destination place (country or city) can help you to get more information from suppliers.

 

5. Cooperation Confirm

We highly suggest you take a sample first before placing bulk orders. Depending on the value of the samples, the supplier may charge the sample fee, but the shipping cost usually will be on your side.

A. Standard Orders

Procedure: Confirm order -> Transfer Deposit -> Arrange Production -> Transfer Balance -> Arrange Shipping;

Usually, suppliers will have stocks or all materials for standard orders. Once the order is confirmed, suppliers can finish the production and ship them out in a very short time.

B. Special Orders

Procedure: Confirm Requests -> Confirm PI -> Arrange Deposit -> (Confirm Pre-production Sample) -> Purchase Materials -> Arrange Production -> (3rd Party Inspection) -> Arrange Balance -> Arrange Shipping;

Usually, special orders will take a longer time than standard orders. You should ask for a pre-production sample (send it to you or inspect it online) before starting mass production. If necessary, appoint a 3rd party for inspection.

 

6. Shipping Arrangement

Please confirm if any special documents for customs clearance are required before the cargo is shipped out. Such as COO (certificate of origin), Legalized Invoice (Commercial Invoice legalized by the Chamber of Commerce), or Form E …

Choose a transportation method

  • Common transportation methods: Express, Air Transportation, Sea Transportation
  • Express: Usually the fastest (3~5 days) option, but high expense, applicable for shipping documents, samples, trial orders
  • Air Transportation: Cheaper than Express, but takes longer time (7~10 days), applicable for samples, trial orders, official orders, emergency replenishment
  • Sea Transportation: The cheapest option, but it takes 20~30 days. Applicable for bulk orders, heavy cargo

Customs declaration is mandatorily required before cargo departure. Suppliers will take 2~3 days to finish it.

It’s very essential to make sure you have the import permission, or your shipping agent can proceed with the clearance before the cargo is shipped out.

Before cargo arrival, shipping companies will notify the consignee (buyer) and the notifying party to prepare for customs clearance. Always prepare documents in advance and proceed with clearance in time to avoid any delay, otherwise, there may be other costs incurred.

If you don’t have the import permission, or it’s temporarily invalid, or other conditions occurred so the customs clearance cannot proceed normally when the cargo arrives, ask suppliers if they have any solutions to ship the cargo, and what is the risk.

Again, always ensure you have the import permission, or your shipping agent can proceed with the clearance before the cargo is shipped out.

 

7. After-Sales

Common after-sales services: Free spare parts for replacement/Online Guidance/Return to Deport/On-site maintenance.

Different companies and different products have different after-sales services, please check with your suppliers before making a purchase.

 

Judging from the current situation, China will still be one of the preferred importing countries for many countries for a long time to come. Whether you have been importing goods from China for a long time, or want to try to import from China, I hope the above content will be helpful to you.

– By Dominic (DOM)

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