Twitter
G+
RSSHow To Import Goods From Overseas For Your Online Store
Recently, one of my readers asked for some details involving importing goods, dealing with customs and paying importation taxes. The process may seem complicated at first but isn’t really that bad once you’ve gone through the process once.
Importing your goods from overseas is the best way to obtain quality products at rock bottom prices. But as with all good things, there are several logistical issues you have to work out in order to be successful.
In this article, I’ll try to provide a brief overview of what to expect when importing goods from overseas along with some details and tips on how to get your goods shipped directly to your place of business.
Photo by Ronnie44052
What To Expect When Importing
- Long Lead Times – Most overseas vendors won’t even begin making your products until you actually place an order and put down a small down payment to cover the cost of materials. Depending on the nature of your items, expect to wait anywhere from one to four months to get your products manufactured. Very rarely will any vendor actually carry any significant inventory so you must plan ahead. When we order the linens for our online store, the lead times are typically 3 months long so we really have to plan ahead and anticipate demand.
- A Hefty Minimum Order – If you are ordering products to be manufactured overseas, expect to place a pretty large minimum order. Every manufacturer will have their own minimums but don’t be embarrassed to ask before ordering. If you are just starting out, take whatever you consider a large order and multiply that number by 10.
- Payment Terms – Most if not all manufacturers expect to be paid by wire transfer. Usually, you have to put down a certain amount of money upfront to cover the initial costs and then pay the balance once the items are ready to be shipped. There are escrow services available to handle payment issues, but in general, transactions go much faster when there’s mutual trust between you and your vendor. Of course, you’ll have to establish this trust over time.
- Quality control – Quality will be an issue in the beginning. In general, it will take several iterations in order for you to get your products exactly the way you want them.
- Language Barriers – Many vendors in Asia will not speak English very well. But as long as you keep your communication along the lines of email, things will go much smoother. Most vendors are able to read English much better than they can understand the spoken language.
Preparing For Your Shipment
So you’ve ordered your products and they are finally ready to be shipped to you. What now? There are two main ways to get your goods into your home country, by air and by sea.
But before you initiate your shipments, make sure you ask for the following documents from your vendor. These will be required in order to clear customs.
- A Commercial Invoice – The declared value of the items
- A Packing List – What you are importing
- A Detail Sheet – Outlines how the products are manufactured so customs can determine the duty classification
- Bill of Lading
Shipping By Air
Shipping your items by air is by far the easiest option but also the most expensive. Expect to pay between 5-6x more to ship by air versus shipping by sea.
Personally, we use DHL for all of our international air shipments. Our vendors all have accounts with DHL and shipping with them is a breeze because they take care of everything.
Basically, the vendor provides DHL with all of the materials mentioned above and then DHL will transport all of your goods directly to the address that you specify. If this is your first time importing goods from overseas, you will be contacted by customs to provide your social security card or a company id number. Just have this information handy once your goods have shipped and you are all set.
DHL will also send you a bill so that you can pay any and all duties associated with your imported goods.
Shipping By Sea
Shipping by sea is a much bigger headache but totally worth it if you are importing a large volume of goods. As mentioned before you can easily save between 5-6x off of shipping by air.
The key to accepting shipments by sea is to hire a good customs agent. This is absolutely required especially if this is your first time importing by sea. Do not try and do things on your own unless you know exactly what you are doing.
This is what the customs agent will take care of for you.
- Customs Documentation – They will take care of any and all documentation required in the entire process
- Customs Entry – They will take care of getting your goods from the port directly to your office
- Customs Duty – They will take care of calculating and billing you for any duties associated with your goods.
- Customs Single Entry Bond – You are required to buy a bond that acts as insurance with Customs in the event you should default on the customs duties. Your customs agent will take care of this for you .
Of course all of these services come at a cost. For our last shipment, we paid over 300 dollars to our agent but it was worth every penny. We got our goods through customs swiftly and without hassle.
To give you an idea of the savings, our last shipment would have cost 1600 dollars by air, but by sea it only cost us 250 + 300 = 550 dollars. Overall, we saved about 3x. The tradeoff was that it took over 3 weeks to receive our shipment as opposed 4 days by air.
Do you have additional questions? Feel free to drop me a line or check out some of my other articles on product sourcing.
Ready To Get Serious About Starting An Online Business?
If you are really considering starting your own online business and quitting your day job, then you absolutely have to check out my mini course on How To Create A Niche Online Store In 5 Easy Steps.In this 6 day mini course, I reveal the steps that my wife and I took to earn 100 thousand dollars in the span of just a year. Best of all, it's absolutely free!
Stumble!
Reddit!
Digg!
Del.icio.us
Facebook
Get Free Updates Via RSS
Follow Me On Twitter
BizSugar
Similar Posts
- Dealing With Wholesale Vendors For Your Online Store When You Are Just Starting Out
- Why I’m Thankful Despite The Recent Chaos With My Online Businesses
- Find Products To Sell Online – How To Find Vendors For Your Online Store
- The Best Way To Find Vendors For Your Online Store
- Product Sourcing Nightmares – Bad Experiences We’ve Had With Overseas Vendors
Have you read these?
- Are You Stuck In A Mental Rut With Your Small Business? Learn How We Got Out
- 5 Things to Look For When Sizing Up Competitors
- What Recession? Why Year Over Year Profits Are Up 75%
- How To Prevent Yourself From Becoming Obsolete And The Reason Why I Haven’t Quit My Job
- How To Choose The Best VPS Hosting – Virtuozzo Or OpenVZ Vs Xen Vs KVM
I really enjoy reading your online blog about starting your own online store, but I am most fascinated that you write an article about the need for a ‘contact area’- and i can’t find one on MWQHJ.com!
Yes please, I would like to see your store.
Keep up the good work. Your writing skills are impeccable.
Russ
Great read. If shipping by seas, how do you go about getting the product from the port to my business. Is that something the customs agent handles?
@Steven
Usually you can have your customs agent handle this. Most of the ones I spoke with handle the delivery which is worth paying for.
[...] How To Import Goods From Overseas For Your Online Store [...]
[...] How To Import Goods From Overseas For Your Online Store [...]
very informative article.
i am in the process of importing from thailand to uk for the first time.
my seller in thailand seems to think he can send via shipping direct to my door and i just settle the bill.
this surely cany be true can it,as who would clear uk customs?
what should i be expected to pay: vat 17.5% duty 4% agents fees,admin etc?
having difficulty rounding it up to an accurate figure.
by the way,the shipment will be 200 pairs of trousers so weight/size shouldnt be an issue.
thanks for any advice
Hi–Your article on how to import from overseas was VERY helpful. I’m in the process and glad that I found your site! How do I get a customs agent? I have an amount worth about $7,500 coming into the US. Thx!
I have the same issue as john. A company in china claims they can ship my order for $450 all the way to my door. Can this be trusted, or will it be caught up in customs and then I get a non-expected bill? They never told me I needed to do anything on my end.
hI
i AM LIVING IN CYPRUS AND THINKING OF STARTING A BUSINESS I HAVE GOT A COMPANY TO SUPPLY ME WITH GOODS (BUILDING MATERAILS)BUT I WAS TOLD I NEED A IMPORT LICENSE IS THIS CORRECT
PS GOODS COMEING FROM UK
I found the “customs agent” part confusing, maybe it was just me. But after much searching I believe the best term to use is customs broker, if I am not mistaken. Seemed to bring up plenty of results and options for me on google. Just in case any of you were thrown of by that. Regardless though, thank for the information. Very useful like the rest of your articles.
@Juan
Yes you are correct. I use the terms customs broker and customs agent interchangeably. Sorry for the confusion
Hi, thanks for the information. But I’d like to know, is it possible for me to buy goods and ship by sea, but the goods I buy are not in a big volume?
It is not a good bargain to ship the small volume by sea. Cos you need to pay the custom clearance/sheet which might called you some money.
I want to import scarves from Peru for resale at my store. I have the manufacturer. They will be shipped by air. Do I have to have an import license or can I just place the order and pay the duty?
I wanted to know your contact Info. Like a phone number and an Email address.
I found a resource page which publishes the 20 most popular products which buyers have searched and inquired for. And also the data is actually updated monthly.
I thought it’s really a very good resource because the data shows what kind of products are buyers looking for! Here’s the link: http://www.globalsources.com/ST/20-Most-Popular-Products.html
Let me know if it’s of any use. Thanks!
Regards,
Brian
Hi,
I am importing items for the first time. Your article helped me more than anything else I’ve read. A quick question, should I be scared of only custom duties? Or are there other hidden charges I’m not aware of.
hi very good information my question is what if any paper work do you need to get from the supplier to get started and also how do go about doing everything possible to make sure they are on the up and up
Hi If I am importing products from South America would my customs agent be in South America or in Canada? The products are being imported to Canada.
Thanks this blog was a great read.
Robert
Hello,
Thanks for the good info, i have a question, does the 300$ you paid to the agent include agent fees? or is it 300$ for the paper work only, and the agent you hired should he be in the same country you import from, or the country you live in? or it doesnt matter?
Thanks
Excellent read! I have been searching for useful information to begin my own import process and am glad I came across this post. Another link I found on how to import from china which may be useful is here: http://www.howtoimportkit.com/is-my-supplier-from-china-is-a-scammer/
A piece on how to tell if a Chinese factory / supplier is a scammer or not.
I look forward to reading your other posts on importing and on the online store Steve! Thanks for writing!