Real Case of Import from China

As I have mentioned I am a International sales clerk in a factory and my job is to sell our goods and service all over the world, I have met lots of customers overseas, with this advantage I know how to import from China and what are the importers mainly concerns.

My first customer named D, this guy is an Australian, and it’s the first time he doing import business from China. Of course besides the product he want he is not clear about how to handle the import business. At the same time I am also a green hand in this field, finally I got his order but the process is not easy as we thought.

Firstly D found me on alibaba and he has great in one of our products, so he send me an email, mainly ask about the price, so I relied with the price and product details.

D is happy about the price, but as business man who always trying to get a better price for more profit, so D and I has a few emails bargain, finally D got some discount. D is happy about that, but I can feel he is not sure about quality of our product, so D asked if we have supplied any distributors in Australia, our company did very well in this field so I told D some of our distributors who are very famous in Australia. Few weeks no news from D, I guess he is doing some research of our distributors locally and it turns out that our products with very good quality so D nearly decide to place the order to us. As I told it’s the first time for D and I doing international business, D does not know how to ship the goods to him, so I have to ask my colleague to help and we asked shipping agent a quote for shipping cost and tell D, after that D is clean cost for him to import the goods. Then D placed his order and do the down payment.

We start production, and one month later his goods are ready and we send the goods on board, we got copy of BL, and send D for balance, after checked, D done the balance to us.

And one month later, the ship arrive Australia, but D met some problem~there are some local cost(happened in Australia) such as THC, handling cost etc. D think it should be bear by him, of course for me, we believe no matter we do on CIF or FOB terms, the local cost happened at destination port should bear by us, so D called me several times and I tried to bargain with the shipping agent~did not work.

Finally in order to keep D as our regular customer, we bear half of this cost. It’s a long story, what I am trying to tell is that there are some local cost should also be counted in the costs, both importer and exporter should know there is a cost. If I know this and tell D, we do not need to share this cost, if D knows this, he wont argue about this.

This is the case.

My Opinions About Greece Debt Crisis

Greece export lots of Stones every year, most of the stones exported overseas and delivered to many places. One of writers friend works in this industry and often go abroad to follow his orders. He has been to Iran and Italy many times, but mostly he discussed with me is Greece. Greece has the best stones in the world, these stones can be used for construction, craving etc.

Each time this friend visit Greece, he will stay at Lama for half month, sometime he may also visit some big cities like Athens. Lama is a small city, but most stones are produced from there.

Writer has asked this friend his opinion about Greece. His answer is simple: Too lazy. Besides Mining Lama also has agriculture. But income of people here is less than 1000EUR. But that does not has any influence on people. They still go to work at10am. Two hours for dinner off work before 4pm.

Greece located in south of European, very hot especially in summer, most worker will off work before 4pm, go back home fall asleep, after they awake at 7pm, they will enjoy some beer or coffee hang out with friends till midnight.

Other workers from other countries mostly works more than natives and earn more money than them. At the beginning people arrived there and found native people have that much free time, all will envy them.

But compared the income, the envy feeling will gone. Greece is developed country, economic stopped so many years, especially these years the debt crisis people’s live become more and more hard.

Why this happens? Writers’ friend is not economist, he loves doing business. But several times business trip makes him understand the debt crisis of Greece better. He think the may reason is the economic of Greece can not afford the rich welfare.

Even people do not work, they still do not need to concerns about got education, got food. In that case, why still work?

May what I found is only not true and only part of it, any comments welcome leave your comments below.

How to Import from China Step by Step

Here is a flow chart which can show how to import from China step by step . Steps in simple:

Quote, sign contract, payment method, production, packing, Customs stuff, load good in container, bill of loading, balance paid, Customs clearance, pick up goods, inland transportation, resell

  1. Quote:

Get a quotation is the very first step before after you have choose the product which will sell good in your market. The quotation should show you: Quality level, model No.,Packing method, minimum order quantity, delivery time, shipping method, product material.

Common quotation will be Fob~free on board, CNF~goods value plus shipping cost, CIF~Value plus shipping cost plus Insurance

  1. Sign Contract:

After both you and your supplier agreed with the price, you will need to sign an contract or ask your supplier make a PI for you. The contract normally contains: product name, model No., price, packing, origin, delivery time, payment method, claim etc.

  1. Payment method:

Totally three normal payment methods: L/C~ letter of credit, T/T~ telegraphic transfer, cash.

Generally L/C used in big amount business, I mean the value of the order is very big, buyer and supplier do not trust each other, so they will need a third party to ensure their safety. But the costs~service cost for this is very high.

T/T is the most used payment method. Generally supplier required 30% down payment via T/T. Balance before goods on board. In that case both supplier and buyer feels better.

Cash happens very few, unless you have family or friend near your supplier, you can ask them to pay by cash.

  1. Production:

This is a very important part~lol. You need to confirm with your supplier about your requirement especially the details you believe is important to you. Sometimes it may happens that you got different products with your contract.

  1. Packing:

That depend, generally for small gifts, toys, promotion goods, ask your supplier to pack them in small gift box and then pack small box in bigger carton is a good choice.

For some fragile cargo, you’d better do some research or ask your supplier for advice to make sure the goods won’t be broken during the transportation.

While for some machines(electric machine) you’d better packed in wooden carton.

Also, you need to consider the cost of different method.

  1. Customs apply:

Generally your supplier will do this from their government(Customs), all you need to do is if your goods contains log(wood), you may need you supplier do the fumigate at their port. Depend on my experience, if your goods contains wood but without fumigate, your Customs will ask you do the fumigate before enter your country, and if you do it at your port that will be much more expensive than do it at your suppliers’ port.

  1. Loading in container:

This part is much simple, if the quantity of goods you ordered can reach full container loading, the shipping agent can arrange the container go to your suppliers’ factory and load the goods. If you ordered less, you may need to share space with other people who also import from China and destination is also your country.

  1. Insurance:

Generally if you do in CIF terms, the quotation your supplier gives you contains the insurance(the insurance named all risks).

  1. B/L~bill of loading

This document will show the goods belongs to whom, which means who has this document who will master the goods.

Generally after the goods load in container, the shipping company will open a B/L to your supplier, your supplier will send you a copy file for you to pay for the balance, after they get the balance, they will send you the original Bill of loading or you can also ask them to do telex release.

Choose original bill of loading or do telex release that depend on your Customs requirement. If your Customs agreed telex release is much faster and simple for you.

  1. Balance paid

As mentioned in the 9th item, after received the copy of BL, your supplier may ask you to do the balance. But just in case, you can also require them to supply some photos for your goods and some photos of loading the container. In that case, it will help you be totally sure you got what you want to buy. After that do the balance paid.

  1. Customs clearance

Before the goods arrived you need to prepare the Customs clearance. At that time, in most countries your government(Cutstoms) will ask you to supply following document:

B/L: bill of loading: signed by shipping company, it contains most goods information. Also shows who the goods they shipped belongs

Packing List: It will show the packing info of goods, how many cartons, gross weight, night weight packing size etc.

packing declaration: Its a declaration signed by supplier to show that your goods does not contains wood or something special

Invoice: signed by supplier, it will show value of goods, also your customer will charge the import tax according to the value show on it.

While some countries will also require following documents:

Draft: Bill of Exchange mostly used in L/C terms

Insurance Policy: signed by insurance company

Insurance Certificate: also signed by insurance company

Certificate of Origin: generally signed by CCPIT~ China Council for the Promotion of International Trade

Certificate of Inspection: signed by AQSIQ~ General Administration of Quality Supervision, Inspection and Quarantine of P.R.C Generalized System of Preferences,G.S.P.

All of the document you could ask you supplier to supply, those they can signed themselves of course its simple they will do. But some document they also need to apply from government. May cause some extra money, but I am sure its much better than after the goods arrived your port but you do not have the documents.

  1. After Customs clearance done, you will need to arrange your inland shipping and arrange the resell stuff.

Welcome any questions at the comments blank.~Andrew

How to Start Small Business by importing from China

You may owner of small store or this is maybe your first time trying to start business of importing from China, so you prefer start with small business.


But you may found, cause the”SMALL” most factories seems not that coordinate, they require a moq, or they offer a high price than mass orders. Another problem is freight, most small business send by express delivery is more economic than less than container loading by sea. So how to deal with all these problems? Now follow me:

1. Select your target goods:

You need to make sure you have local market and you could sell them very well.

You have to make sure the goods are not of very high value.

Both packing size and gross weight of this goods are not big so you could save much costs for the freight.

For example, festival gifts are good choice.


2. Find a supplier, this supplier maybe not a big factory nor a big trading company, but they could supply what you want.


Discuss with them, do not show you quantity first, after you got most info such as packing size, gross weight, price, and other necessary info, you could let your supplier know that you need to place a trail order. In fact you really need to place trail order to your supplier even you are a big customer.


Then you supplier may require a high price, then you can negotiate with them, let them give you a different price level depend on the quantity, depend on my experience the price you got will be much better than if you show your quantity first.


3. Freight

You could ask your supplier help to ask a quote from their local express deliver company, or you could check it yourself.


Generally you could ask a discount from the express delivery company, cause they calculate the cost depend on the packing size or gross weight.


4. Payment

This is really a big problem for small business. Normally for international business, supplier and customer will choose 30% TT in advance, balance against copy of BL.


But for small business, most supplier do not accept that, if you are a good negotiator, you could do prepaid by paypal(because you can ask refund if any problem happens on you goods, so the supplier has to suffer some risks via this payment method).


Or you can choose west union, still do the 30% down payment, balance against copy of express tracking NO. and photos can show your goods was send.


5. Another shipping method is ship by air for small business, shipping by air(airport to airport) the cost is lower than shipping by express delivery, but because they can only send your goods to the airport, you will need to do the Customs clearance and your inland transportation.


6. Customs clearance, that depend on different Customs rules, for example, if you are Australia guy, if value of your goods are lower than AUD1000, you may not need to do the tax.

For that info, you’d better ask advice from your local Customs


There is another way you could save the duty~write lower value of your goods, you can do this, but remember, never out of the line too much, your Customs are not fool.


By the way, if any interest maybe you can also contact me for the small business, but only small business.

How to negotiate with your chinese supplier

This negotiation is not only about the price but some other things which may have very big influence on your business. In fact most Chinese goods are not expensive.

Even I told price is not the most important but for negotiation I still think we should start from the price. Before do that you should do some research on the Chinese supplier market. How many suppliers~both factories and trading companies, of course I am not telling you to count them one by one and got a number. Then do some research about their price and the description of their goods. At that time I think you are already clear about your target price. Then do it, start from the one who interests you most and try your best to see if you could get a satisfied price, during this your research comes in handy, you can use this to persuade the supplier to give a you good price. But remember never being too much, if you forcing their price too much they may change some of the material difficult to notice to reduce their cost.

Second, quality. As we all know if we buy some rubbish, we will lost our customer, so find the good quality supplier and try their samples, after you tried you could select whose goods if for you. And before you place your order you need to emphasize the quality to your supplier as more as you can, or they may supply you some low levels goods instead high quality one.

Third, delivery time. All the business man who have experience in importing from China may have that experience: you have formulate the delivery time and supplier agreed, but when the delivery time comes, you goods are still on production or still on material purchasing part. So before you place your order, do not forget to repeat the delivery time. And if the delivery time is 30 days, I suggest you should ask the updates at least three times. Especially for some seasonal goods. You can imagine, you ordered lots of gifts for Christmas and hope to sell all of them during the festival, but when you have prepared everything but your goods are still on production and when they arrived the Christmas already passed. That is disaster.

After sale service, since most of factories are live on OEM business, they do not sell the goods to final customer, so normally they do not think they are in charge of the after sales service, and when something bad happens, you may need to take this risk by yourself. So before you place your order, you need to ask them how long their warrant can be? How do they manage the warranty. And write this in the contract/PI is important. When some emergency happens at least you could recover some of your losses.

If a supplier can satisfy all that condition, then you’d better never give them up. To be candid in my opinion most suppliers can not match all that conditions

How to Import from China~how to choose supplier

How to choose your supplier, sometimes I would prefer call them partner, cause they are not only supplier, sometimes they are your friend, what they supplied are not only goods but also service.


Then how to find high quality supplier? If you are in small business you could find the on the internet, Chinese factories nearly seize tenth of the markets. From their websites or some B2B websites you will find a lot of suppliers their goods are in different levels and price. You will need to judge depend on your business position, if you are in the high end market, then you could start from some high level goods, if you prefer try some low quality goods~you should better not, at least you choose the mid level goods.


From the websites you could find their contact info, then how to contact with them? My suggestion is via email, some suppliers have very good product, but their sales department may not that suit for their goods, their English are not as good as we hope~ I am an example.


Then what you should ask in your email? Most people may write like this: “plz provide you quotation on XXX”, that kind of inquiry you could get offer, but I think that is a waste of both you and the suppliers’ time. You should tell them your aim, which produce you would like, description then ask them the price, packing info and any other questions you may need to know. Then you could get a high quality reply~most questions solved in one email.


After that screen you may know which suppliers you have interest, then in-depth discuss with them, price, after sale service etc.


But before you place your order, I suggest you try one sample. For small goods most supplier can supply free sample, you only need to pay for the freight. But for big goods you will have to pay for both sample cost and shipping cost. If necessary you may need to visit their factory to know them well. After that you could place your order, but do not forget to mark the deliver time on your contract or PI, that’s very important and I will open a new blog specially about what to mention when you import from China.


Another way to find supplier in China is attending exhibition such as canton fair. On the fair you could find many supplier who are very effective. Of course the cost for attending a exhibition is also high.


Also, you could ask your friend to recommend. As you may agree “made in China ” is filled in our daily life, maybe your neighbor is experienced in import from China they could recommend some high quality supplier.


Sometimes your embassy will recommend supplier from China, you could find the supplier info from the embassy websites.


Find them, discuss with them, select the one who can supply the right goods you want, place your order. That’s it.

How to Import from China~Trade clause

Now let us talk about the trade clause, we will start from the most common trade clause


Fob: (Free on board)

From the literal meaning we could found the point for division of risks~supplier need to send the goods on board. That means before being on board all the risks should be assumed by supplied, such as catch fire in the warehouse, being soaked, lost. But after the goods being on board all the risks are belongs to you


Costs depend on Fob trade clause: supplier is in charge on supplying your request goods, transport them to port, do the Customs apply, pay you their local charge. All these costs make up Fob price


Note: after the goods being on board, you will need to buy insurance. Of course that all depends on you, if you do not think you need this, then let it go.


CIF(Cost,Insurance and Freight)

From the liernal meaning you may found what makes up the costs. Supplier need to pay for the insurance and freight besides Fob costs. Means CIF=Fob+Insurance+freight, freight here we mean international transportation costs.

Risks: same as Fob, but supplier need to but insurance, if they did not buy insurance when any emergency happens supplier will have to pay for that.


CFR(Cost and Freight): this one is much easier, Cost and freight make up the CFR price, you need to buy the insurance yourself. CFR=CIF-Insurance=Fob+Freight


Same risk with CIF.


EXW(EX-works): supplier deliver the goods to you in their factory~done. That price might be good, but you will have to face the Chinese inland transportation, Customs apply, local charge~so complicated, so I do not suggest use this trade clause.


DDU(Delivered Duty Unpaid)

Supplier deliver the goods to your pointed place, but they do not in charge of your Customs clearance, duties.


Risk, supplier will take the risk before deliver the goods to your pointed place, but if the goods can not deliver to your place because you did not do the Customs clearance and duties, that risks belongs to you.


Honestly speaking, in this trade clause, you may save a few trouble but the cost is higher and your still need to do the Customs clearance and duties.


DDP(Delivered Duty Unpaid)

This trade clause is similar with you buy something inland, supplier delivery the good to you, and you only need to accept cargo and pay money, seems the most save trouble way, but you save trouble you may also save your profit, I promise you the cost is really high.


There are some other trade clause, but not in common, so we pass them. This artile should be a long-winded but honestly speaking in my opinion this article is very boring so I make it as shory I I can but still…… So only remember the FOB, CIF is enough for you.

How to Import from China~costs calcultation

Please allow me introduce myself first. Andrew Zhao, a Chinese to the core. Because my major is business English~international business, so after my graduation I naturally become a internal clerk. My main job is to find customers overseas and sell our goods all over the world.


To be candid, I am not a success business man, but being is this field in years, I know something which may helps you guys to know how to import from China.


First of all, you should have a target, you should know what level goods you want, then you could do some research about the cost.


Regarding to the cost here is a list which may help(depend on Fob trade clause):

1. Fob Price of the good (Will open a new blog to tell all the trade clause)

About that price, you need to know is: this cost contains the goods value, and supplier need to send the goods to their nearest port in China. Also supplier need to pay for the Customs costs and local charge.


In one word, this price has contains any costs happens in China mainland.

2. Shipping cost, in order to get the shipping cost, you need to get the detailed packing info such packing size and gross weight from your aim supplier.


After you get that packing info, you will need to ask a quote from a logistic company for the internal shipping. Shipping cost usually calculate depend on the packing size.


Also, you could ask your supplier to help ask a quote from their shipping agent, but I suggest you choose your own forwarder.


3. Costs for the forwarder handling~destination cost. This cost is very complex, in one word, these are some names you do not even know what that mean, but forwarder will ask you to pay for. So before you start, clear the cost is very important.


As I mentioned this costs are very complex, there are many names and many items of costs, such as THC, Customs clearance, Delivery charges, handling charges, port security etc.


So when you ask quote from the forwarder, never forget to get a reference destination cost, before you make a decision.


4. Duty: Customs duties, GST and some other duties your government have ruled.

Different country have different duties and how much you may need to pay all depends on your government rules.


About this costs you could ask help from Customs of your port, or your local forwarder.


5. Your inland transportation cost

This cost is simple, just normal transportation cost.


6. Also there may comes to some storage cost

When the goods arrive to your place, you may need to put them in warehouse, so do not forget to calculate this cost.


7. Insurance~ not high but very important

Generally cost for insurance is very low, but most people may forget or they wanna save this tiny money. While I suggest never forget to buy insurance, that is guarantee for your money. After checking with the insurance company you will find that cost is really low.


There may some other costs I did not mentioned such as your business operation cost; ad etc.


Calculate all of these and compare with your current market price, if the profit is good then you could consider to do that business.


Ok, with these info you may know how to calculate your costs. Will open a new blog to explain all the trade clause.