How to Source Products from China?
So you want to begin selling products online? By now, you’ve probably already dipped your toes in the market and tried setting up an online store. However, without any products to list on your eCommerce platform, you’ll never make a dime.
Whether you want to become your own boss or even if you want to generate a side income so you can enjoy a better retirement, knowing how to properly source products from China is crucial. This will allow you to cut down on your overhead costs and make more money from each and every sale you make.
Sourcing Products from China - A Better Option
China is one of the best places to rely on when you want to sell products on the internet (or even offline for that matter). They have tons of manufacturers set up and ready to create just about any type of product imaginable. Whether you want to resell an existing product or even if you want to sell your own creations and have them made for cheap, China is the way to go.
With cheaper costs of labor and tons of available products to choose from, you’ll definitely make your life as an online merchant easier by sourcing products from China. We’re going to cover all of the available options along with how to get the best results and the cheapest prices. By following the information in this guide, you’ll be sourcing products from China in no time and reselling them locally at steep margins!
Wholesale or Dropship?
Before moving forward with your China sourcing, you’ll need to consider whether you want to proceed via wholesale sourcing or drop shipping. Both have their own set of advantages and disadvantages. We’re going to compare both options so you can make an educated decision on which direction you wish to choose.
Wholesale Sourcing
Wholesale sourcing is the first option we want to cover. This practice basically involves purchasing large quantities of the same product at a wholesale price and reselling them at their recommended retail price. The main advantage to this method is that you own the products in your possession, so you have more control over the shipping, the branding, the sale price and more. However, it requires a lot of upfront cash and you’ll need a place to store all of these products.
Sourcing Products to Drop Ship
Drop shipping is another common option for most new merchants. If you don’t have a lot of storage space, this is the ideal method since you don’t actually hold any of the products. In fact, in most cases, you’ll never even see the actual products unless you order some for yourself.
Drop shipping works by finding a manufacturer overseas who can create the products you want to sell. They often handle everything from creating the products to shipping them and even dealing with returns. When one of your customers places an order, you essentially place the same order with your manufacturer and have them send the product to your customer’s address.
Downsides to drop shipping include not actually seeing the products, dealing with much longer shipping times and not having much control over most of the process. This is really a better option for people who want to attempt selling products online without much initial investment or commitments.
Sourcing Products & Suppliers from China to Sell on Amazon
Amazon has become the largest marketplace on the internet. Selling there is not only a great place to start, but it’s also a great place for online merchants to make a lifetime career. However, as such a large marketplace, many products from China are already listed there. Knowing how to find the best products for Amazon is a vital step - you don’t just want to try selling anything without doing any research.
There are many things to look into including demand, product availability, costs of sourcing the products, Amazon fees, shipping fees and competition. A great way to get ideas is by checking Amazon’s best selling products or new trends. This will give you a good sense of direction. Once you’ve decided on a product type, go ahead and check the competing products listed on Amazon as well as their selling prices. Your goal should be to sell your item for a little cheaper without compromising on quality.
Stay away from health and beauty products that we need on a regular basis such as toilet paper, dish soap, shampoo and other such items. You’ll have a hard time competing with the big brands that people already love and purchase blindly. However, products such as fabric pots for plants, kid blocks, tool kits and other such items that people want to buy for as cheap as possible are great ways to make a ton of money.
Always consider your product margin. Amazon charges fees for the products you sell, so it’s a good idea to look into their fee structure and make sure that you will earn enough money to be worth it. You can often find existing products in China for cheaper, so you can resell them on Amazon at a much higher price point. Just stay away from trademarks and start out with small orders to test the market before buying in bulk.
Sourcing Products & Suppliers from China to Sell on eBay
Selling products on eBay is very similar to selling products on Amazon. They have a ton of daily users and you can sell just about any type of product. Keep in mind that just like Amazon, eBay will charge you fees for selling on their platform. Again, it’s a good idea to learn about their various listing fees before committing to a single product type.
Sourcing products for eBay stores is a similar process to finding products for Amazon. Find products that sell well, have few competitors and then find a cheaper version from China then resell on eBay for a profit while trying to list it at a little lower than your competitors.
Keep in mind that products that sell well on Amazon might not always sell as good on eBay and vice versa. For this reason, it’s a good idea to list your items on all marketplaces to really enhance your chances of reach more customers and getting more sales. eBay tends to be a better marketplace for rare products, big brand imitations and cheaper options to existing products, whereas Amazon can be considered “the Walmart of the internet”.
Sourcing Products & Suppliers from China to Sell on Shopify
If you have a Shopify store, sourcing products to sell on your existing platform is simple. Shopify has numerous third-party apps that can handle a lot of the procedures for you. For instance, the Oberlo app, which is one of the most popular drop shipping apps for Shopify, can help you find great products, add them to your store and even fulfill orders with pure simplicity.
If you choose to manually source products for your Shopify store, you should use the same guidelines as when finding items for Amazon or eBay. Also, make sure to fulfill your orders, otherwise you will end up with a ton of unhappy customers.
Some advantages of selling products via Shopify instead of Amazon, eBay or other marketplace sites online is because you save a lot of money via a lack of fees. You will still have to pay payment processor fees, but they are much smaller than Amazon fees or eBay fees. You will also gain better brand recognition by selling directly from your online store.
Chinese Product Sourcing Websites
There is a large amount of Chinese product sourcing websites that allow you to purchase items that are created in China. These platforms allow you to connect directly with manufacturers from China who are capable of creating products for cheap without necessarily compromising on quality.
Knowing which platforms to use in order to source your products is crucial in order to find quality items without spending a fortune and without getting stuck into a scam. We’re going to cover the most popular Chinese product sourcing platforms so you can quickly and easily find the items you need at price points that make sense for a business that plans on reselling them.
Alibaba
Alibaba is the major player when it comes to Chinese product sourcing online. This marketplace is brought to you by AliExpress and has millions of active users. It functions as a marketplace that allows buyers and manufacturers to easily connect with one another. Manufacturers display products that they can create and they place their price points according to the amount of products you order at once (the more you order, the more you save).
Alibaba is simple to use, they have a solid messaging system and you’ll find just about any type of product imaginable. You can even find manufacturers who can create custom products. One of the few downsides to Alibaba is that many of the products are already available on platforms such as Amazon or eBay - it’s important to do your homework and find items that aren’t already being sold on major marketplaces.
AliExpress
AliExpress is very similar to Alibaba - it’s actually brought to you by the same company. However, Alibaba is best suited for sourcing products from China. AliExpress is more of a platform similar to Amazon, whereas Alibaba allows you to get in touch with the people behind the products. However, you can also use AliExpress to find great distributors from China, making it a decent place to search for Chinese products. However, the best use for AliExpress would be to list your items for sale on this platform once you actually sourced items from other platforms. When it comes down to it, AliExpress and Alibaba are very similar, but Alibaba is the best option for sourcing products.
DHgate
DHgate is another excellent place to go when you need to purchase items from China at a cheaper price than purchasing them locally. DHgate also allows you to buy and sell globally, but they excel at bringing you into direct contact with Chinese manufacturers. Similar to Alibaba, you will be able to find the price for single units or explore reduced price points when ordering in bulk.
DHgate has all sorts of excellent products for sale including apparel, electronics, toys and even pet products. If you can’t seem to find the exact item that you’re looking for on Alibaba or even if you’re looking for better prices, it’s a good idea to check out DHgate as well. The more sources you compare, the more chances you have of getting lower prices and higher qualities.
ChinaBrands
Another excellent option to bookmark when sourcing products from China is ChinaBrands. This online marketplace brings you in contact with loads of manufacturers. While they do cover a lot of different products types just like the other marketplaces mentioned above, ChinaBrands has a special preference for technology and electronics.
If you’re looking for electronics such as drones, GPS devices, phones, computer parts and more, ChinaBrands is an excellent place to check. It’s important to keep in mind that quality will vary greatly from one manufacturer to another and nothing is more delicate than electronics. For this reason, it’s a great idea to actually test the products before selling them under your brand.
Chinavasion
Chinavasion is another marketplace for sourcing products from China that specializes in electronics and technology. If you’re looking for a supplier that delivers low-cost LED lighting, IP cameras, car accessories or even sports cameras, Chinavasion is the place to be. They have tons of manufacturers for you to discover, allowing you to compare prices and get the best deals so you can increase your margins. Chinavasion is definitely one of the top Chinese product sourcing platforms worth adding to your bookmarks.
Considerations
Sourcing products from China may seem like a simple task in setting up an online store, but it’s actually more complex than most beginners think. You’ll have lots of steps to take in order to ensure that you get quality products at the lowest prices available. From product testing to communicating with Chinese vendors, the process can quickly become overwhelming. Follow our considerations below to be better prepared for what’s to come.
Taxes
The first and most important consideration to keep in mind are the taxes and additional fees you’ll have to pay. Most beginners take the cost of the product and calculate their profit margin using that cost only. However, many other fees can come into play, which ultimately reduce the profit margin.
Make sure you’re well aware of taxes, duty fees and any other type of shipping costs involved. Another important thing to look into is if there is a possibility of shipping issues further down the line. For instance, a few years ago, the Chinese ports decided to stop shipping airsoft guns and accessories. This lasted for several months. The last thing you want is to finally find a great product that sells well, but that eventually gets shut down.
Delivery Times
When sourcing products from China, you save money - it’s the main reason most people source from China. However, the major downside is the delivery time involved. Most Chinese product suppliers can only guarantee deliver times of 1 to 3 weeks - sometimes even longer than that.
This can cause issues with clients who are used to services like Amazon that deliver within days. It’s also an issue when dealing with returns - it can take weeks to get a product replaced. Chargebacks are a major issue with Chinese suppliers since many people choose to cancel a charge on their credit card if it takes too long to arrive. The best way around this is to clearly state during checkout the amount of time it takes to receive the products. Making your customers aware of the shipping delay is the best way to keep chargebacks to a minimum. Another important thing to consider is having a support channel such as live chat so customers can ask you about shipping delays and so you can relieve their worries.
Miscommunication
Something you should take into consideration is the communication breakdown that you may experience. You’ll be dealing with people from China who have learned English as a second (maybe even third) language. This means their English won’t be perfect, so you may run into miscommunications from time to time. This can be a small problem or a major issue if your supplier ends up sending thousands of products that you didn’t want or need.
Make sure you find a supplier that you have an easy time communicating with and make sure everything is clear and fully understood before moving forward with orders. If you speak Chinese, that’s a huge plus, but if you find a Chinese supplier who speaks very well in English, that will be even easier.
Manually Verify Suppliers
Verifying the trustworthiness of a supplier is important. With many online sources, review sites and consumer reviews on the internet, it’s easier than ever to verify the legitimacy of a business. Making sure that the business you will be dealing with is trustworthy is incredibly important.
Most Chinese product sourcing websites provide you with feedback for suppliers, so that’s a great place to start. However, some of those reviews could be sponsored reviews or faked, so don’t just rely on that one source. It’s a good idea to look in forums, look up the business name directly in Google and search other platforms for the same vendor. Gather as much information as possible before moving forward with a supplier.
Quality Assurance
Ensuring the quality of the products you will be selling is of utmost importance. You’ll be adding your own brand name to these products, so you should only sell products that you’re proud to call your own. The best way to test quality is to actually order one of each product before ordering them in bulk. This allows you to see the speed of delivery and once received, you’ll be able to test them in every way possible. Test the durability, test the functions, give everything a good testing to make sure the items you’re selling are worthy of your store.
Ordering Samples for Marketing Purposes
Just like mentioned above, ordering samples is important in order to test the quality of the items you will be selling. It’s a good idea to use these samples to take product images, make videos and even reviews for the internet if you have a blog. With social media being as important as it is, it’s a good idea to try to make videos of you using the products in hopes of creating viral content. This is a great way to get your first initial traffic.
Dealing with Chinese Manufacturers
There are a few tips we’ve learned after spending years dealing with Chinese manufacturers.
Be Friendly
First and foremost, they much prefer being treated as friends rather than business partners. Keep conversations light and be polite - don’t worry about sounding professional. They enjoy doing business with real people.
Show Trust
Trusting your manufacturer is another important aspect of dealing with Chinese suppliers. It’s similar to a relationship, trust is everything. The moment you stop trusting your supplier, that’s when everything will start going down the drain. Until they screw up, give them the trust they deserve and you’ll have a much more successful business partnership.
Double Check Agreement
Another important tip we can provide is to double check that your supplier has understood what you said. They will often say stuff along the lines of “I understand”. Never believe them when they say they understand, make an extra effort in order to clearly lay out your terms and what you need in simple English.
How to Negotiate the Best Price?
Finally, we want to leave you with a sound piece of advice - always negotiate the costs of products. They list their desired price, but you are the client and you can back down at any moment. The simple truth is that suppliers are ready to go an extra mile to get your business - especially if you plan on doing business with them for a long period of time.
Most suppliers are willing to come down on their price. Don’t feel bad about driving the price down - the only way you will succeed in business is by increasing your profit margin and this could be the difference between you having the advantage over your competitors.
