This post was written by Josh Nacol, a student in my Create A Profitable Online Store Course.
Recently Josh started importing goods from Asia for the very first time and wanted to share his experiences with my readers. Now in my class, I have an entire module dedicated specifically towards helping students import goods from overseas.
However, it’s one thing to learn and another thing to actually go out and do it. And Josh’s experiences just go to show that the best way to learn is to be aware of the guidelines, know what to expect and just take action!
A quick disclaimer: Josh had never done this before prior to joining my class and he was a bit intimidated early on by the process. But after going through it once, he realized that it wasn’t that bad.
As Steve mentioned above, I recently completed the sample sourcing process and wanted to share some tips and mistakes I made along the way. Enjoy and please let me know if you have any questions or comments.
Tip #1: Never Assume Anything
When it comes to communicating with your vendors, you should never make any assumptions about product availability.
On multiple occasions I had vendors try to sell me products that were not displayed on their website. In contrast, I also requested samples of products that were displayed online but no longer available from the vendor.
Often times, a vendor’s website is not up to date and some vendors are better than others at maintaining their online offerings. I even had one instance where after paying for samples the vendor came back and informed me that 6 of the 9 samples ordered had been discontinued.
Moral of the story – Don’t assume something is or isn’t available. Make sure to ask and confirm prior to ordering and especially paying for any samples.
Tips on questions to ask:
- Are there any new products or designs that are not currently displayed online?
- Are there any products displayed online that were discontinued or no longer available?
Tip #2: Don’t Be Intimidated By Your Vendors
Most vendors that I dealt with responded in a quick and friendly manner, which reinforced the importance of relationship building. While in a few instances vendors seemed a little cold, most vendors were very eager to engage in conversation, answer questions and discuss samples.
For the most part, their written English skills were pretty darn good. Their ability to both send and receive emails exceeded my expectations. Also, make sure to be complimentary without overdoing it. For example: “I was looking at your catalogue and noticed you have some very nice products…”
Moral of the story – Vendors are real people just like you and me. Don’t be afraid to jump in and start a conversation.
Tip #3: Trust Your Gut
Some vendors are almost too friendly. This is probably due to the cultural differences that exist but when I say too friendly I mean 2-3 emails a day, asking if you want to look at or buy something after you’ve explicitly declined or said no 3-4 times.
Editor’s note: I never use my main email address for Alibaba correspondence to avoid getting spammed by vendors.
While I’m sure most of these folks have good intentions, this behavior definitely raised a red flag due to the used car sales pitch (no offense to any used car salespeople)
Moral of the story – Trust your instincts. Give people the benefit of the doubt but go with your gut.
Tip: If you’re trying to source leather bags and the vendor is trying for the 4th time in 5 days to sell you cat beds, time to hit the spam button.
Tip #4: Be As Specific As Possible
Tailor your vendor inquiries for specific product categories. This might sound obvious but it’s important to be very specific from the start about what you are looking to buy including types of products, materials, size, color, etc.
As an example, I was searching for a variety of bags including leather bags. When I sent an initial email to one vendor who specialized in leather, I accidentally included photos of non-leather bags which caused some confusion.
I would also advise using an email template (I used the one provided in Steve’s course) but make sure to customize 10% of it to each vendor. If you want something made of polyester, specifically state in your email that you are looking for a polyester widget.
Otherwise, like me you might receive a different and most likely cheaper product or material than you intended.
Moral of the story – Don’t assume anything regarding product details.
Tip: Be very specific and ask the vendor to confirm product specifications before both production and shipping.
Tip #5: You May Not Get What You Expect
The ole saying, “ what you see is what you get” doesn’t necessarily hold true for Alibaba and Global Sources. Despite doing everything suggested above, there were a couple occasions where the samples I received were not the samples I ordered.
When I confronted the vendor as to why the products were different than what I ordered, the typical response was something along the lines of: “that product was discontinued or we only had this one other product ready for shipment…blah, blah, blah”
Moral of the story – You never get a second chance to make a first impression. Don’t be afraid to hold a vendor accountable. Some might disagree on this one but my thoughts are if they can’t get a simple sample order correct, the likelihood of screwing up a bulk order is probably be higher.
Tip: Confirm the sample order prior to shipment and request photos of the samples to ensure they are accurate.
Tip #6: Most Vendors Expect Wire Transfers
Payments! Most vendors will allow you to pay via PayPal. Some have PayPal but will not tell you unless you ask so make sure to ask. In fact, with most vendors, I used wording along the lines of: “Our company policy states that first time samples purchases be made using PayPal”.
While most vendors will accept purchases through PayPal, they definitely prefer and will default to T/T (wire transfer) or Western Union. I paid via Western Union for one vendor and didn’t have any problems. I found it to be just as easy as PayPal but with Western Union you have no recourse to get your money back. Once the money is gone, it’s gone.
Moral of the story – Pay for most samples using PayPal but don’t be afraid to pay via wire transfer or Western Union. It’s not the end of the world.
Tip: I would recommend paying via wire transfer (T/T) with one vendor just for the practice. If it makes you feel better, choose a vendor who you will be paying a smaller amount of money to for samples. Although just a suggestion, doing this will help to familiarize you with all the routing and logistics related to international wire transfers.
If you decide to pay via wire transfer, make sure and confirm that you have the exact wire information including beneficiary information, address, swift code and account number. This point can’t be emphasized enough.
I learned the hard way with one vendor and it cost me $75 in wire fees. If one character is incorrect, then the Bank of China might relegate your funds to the Chinese banking void for an unspecified period of time. Plus, you’ll have to pay additional fees to your bank to either recall or amend the wire.
Tip #7: Always Obtain Samples
Samples are an investment. Pharmaceutical companies are notorious for spending millions of dollars on R&D every year. Most drugs will not make it through clinical trials and some will not receive FDA approval, but the few that do make it past all the hurdles will make the investment worth it.
While purchasing samples can seem daunting, make sure to keep things in perspective. Compared to an initial investment for a Subway or UPS Store franchise, the risk/reward ratio is much higher for online stores, not to mention the difference in lifestyle.
Moral of the story – Don’t be afraid to spend money on samples. You have to know what you’re selling before you can sell it and you’ll learn a lot in the process. Be judicious depending on your budget, but don’t hold back for fear of failure.
Tip: Ask vendors what their top 5 products are in terms of sales. Take your time to find the products you like the most because more than likely there will be more products you’ll want to see in person than you’re willing to pay for. Pick the very best ones based on the photos, product descriptions and vendor recommendations.
Tip #8: Act Bigger Than You Are
In your emails to vendors, use the word “we” instead of “I” and “our” instead of “my”. Steve emphasizes this several times in his course. Not only does this make your company seem larger than it is but it also displays a sense of teamwork and unity.
Moral of the story – Project confidence.
Tip: Here is an actual email I sent to a vendor after receiving samples. Notice the use of the word “we” and “our”.
We wanted to confirm that we received the samples today. Over the next couple of months we are going to be meeting with many of our customers to discuss your products and potential plans to move forward with larger purchases. We will certainly keep you updated on our plans.
We did have a few questions in the meantime:
1) Do you provide OEM service (logo)?
2) Can you manufacture according to specific size and color requirements? (For example if we wanted to purchase 5 different products, each with 3 colors and 2 sizes.)
3) What are the minimum order quantities and lead times for bulk orders?
4) How do you deal with product quality issues? For product YD0354, the zippers were very difficult to fasten and ended up breaking in one instance. For most products, we prefer one piece (like YD0316) instead of two pieces to make the assembly process as easy as possible for our customers.
Tip #9: Know The Difference Between Manufacturers Vs Trading Companies
In general, it’s pretty easy to tell if a supplier is a manufacturer or a trading company (wholesaler/retailer). I did however notice some very distinct trends between the manufacturers and trading companies.
As a general rule of thumb, the ones that say “Import/Export Co” are more than likely not manufacturers even if their company profile states manufacturer.
Along with the obvious things such as price and MOQ differences, trading companies definitely had more of a pushy sales approach while the manufacturers seemed more eager to build a relationship.
In the beginning however, it might behoove you to buy from the trading companies because they will offer lower minimum order quantities (MOQ). Just know that the FOB prices (price per unit) will be higher with the trading companies and there is a greater chance for complications such as running out of inventory (if they’re not creating the product then they have less control over the amount of inventory that’s in stock)
Moral of the story – Know who you’re dealing with in terms of the type of supplier and the pros and cons of working with a manufacturer vs. a trading company.
Tip: In some cases I politely asked certain vendors what percentage of their business was manufacturing vs. wholesale. Most reps were more than happy to share that information.
Tip #10: Be Prepared When Shipping Goods To Your Home Country
Oh the joys of international air freight! Most vendors will setup the shipping for you and all you have to do is provide your shipping address and phone number for confirmation. Just know ahead of time that it’s going to cost you and arm and a leg and that the cost of shipping might in fact be more than the cost of the actual samples.
Also, it’s a good idea to confirm shipping costs before paying for the samples. Some vendors will lump the two costs together while others will separate them out and surprise you at the last second.
Moral of the story – Shipping samples is expensive. If this depresses you, remember that samples (including shipping) are an investment!
Tip – Don’t wait until the last second to setup shipping accounts. As a rule of thumb, before you contact any suppliers, have your shipping accounts setup with UPS, FedEx and possibly DHL. UPS and FedEx can be done online.
DHL is a more involved process (felt like I was applying for a mortgage) that involves a phone call and you providing them documentation such as recent bills, invoices, etc. It’s a pain but necessary per DHL to prevent fraud and ensure accurate controls over shipping.
Note: Are you unsure which shipping method to use and how much it will cost? Do you want a good estimate of your real landed cost of goods? Click here to use my free import calculator
Because it was my first time importing goods from Asia, I made a few mistakes but I learned a lot in the process. Here are some questions I would ask yourself after you’ve received the samples:
- Which vendors did you enjoy working with the most?
- Which vendors were the most flexible and accommodating?
- Which vendors wrote and/or spoke the best English?
- Which vendors shipped the samples in a timely fashion?
- Which vendors shipped samples that were packaged nicely?
- Which vendors were the most accurate and paid the most attention to detail?
In the end, your experience will be different than mine, but I hope that the tips above can help you along your journey.
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