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Basic Guide to Importing From China
The document discusses the opportunities and challenges of importing from China, providing tips on how to get started by assessing products and suppliers, finding reliable suppliers through sites like Alibaba and trade shows, and strengthening relationships with suppliers through frequent communication and quality control to minimize risks. Key points include evaluating direct versus indirect sourcing strategies, the importance of total cost analysis and developing long-term supplier partnerships.
Basic Guide to Importing From China
- 1. Importing From China WenshengLi, MBA, CPSM, CQA Andrew Rizzo 1/30/2015 1
- 2. Agenda • Opportunities andChallenges • How to Get Started • Finding Reliable Suppliers • Strengthening the Supplier Relationship • Minimizing risk • Q & A 1/30/2015 2
- 3. Opportunities & Challenges TheSuccess Stories • iPhone & iPod • Nike • Laptops and more The Horror Stories • Toys with lead paint • Unsafe tires • Tainted pet food, toothpaste … 1/30/2015 3
- 4. Getting Started • Selfassessment – Budget – Import volume projections – International trade expertise – Language skills – Product assessment • Get help! 1/30/2015 4
- 5. Product Assessment 1/30/2015 5 CriticalStrategic Non-critical Leverage Value Risk
- 6. What Strategy toTake? • Indirect – Trading company/Intermediary • Direct – Deal with factory directly • Hybrid 1/30/2015 6
- 7. Direct vs. Indirect 1/30/20157 Find substitution Direct Partnership Indirect Indirect / Direct Value Risk
- 8. Identify Suppliers • Alibaba.com,Globalsources.com, … • Trade shows • Industry clusters • Referrals & contacts 1/30/2015 8
- 9. Four Types ofSuppliers 1/30/2015 9 Domestic with int’l experience Domestic with no int’l experience Trading company Foreign invested Price
- 10. 1/30/2015 10 Yangzi RiverDelta 1% vs. 18.8% Beijing-Tianjing Hebei Region Pearl River Delta 0.4% vs. 10.2% Industry Clusters National Bureau of Statistics 2006
- 11. Evaluate Suppliers • Pastperformance • Capacity • Time in business • Financial factors • Service • Price (total cost analysis) • International experience (CPSIA, ROHS) 1/30/2015 11
- 12. Total Cost Analysis Before transaction Tradeshow Supplier evaluation Negotiation Extra charges or VAT? During transaction Price Order placement Delivery / Freight Inspection After transaction Rejects Damages Re-work 1/30/2015 12
- 13. Minimize Your Risk •Develop a good supplier relationship • Quality control 1/30/2015 13
- 14. A Good SupplierRelationship is an Investment in your Success • Face to face meetings • Top management involvement • Timely payment • Incentive program • Get feedback from your supplier • Educate your supplier • Learn to say ‘ni hao’ 1/30/2015 14
- 15. Deal With Quality Beforeproduction During production After Production 1/30/2015 15 Detailed specifications Production sample Packaging details Contract Foot on factory floor Inline inspection Subcontracting?? 3 Party Quality Control Inspection Cha Bu Duo??
- 16. Completing The Transaction •Freight • Payment • Customs clearance 1/30/2015 16
- 17. Conclusion • It’s easyto find a supplier but it takes effort to find a good supplier. • Do your home work and plan well. • There is no substitution for face to face meeting. • Quality is ultimately buyers’ responsibility. 1/30/2015 17
- 18. 1/30/2015 18 Contact: WenshengLi www.linkedin.com/in/wenshengli