Sourcing Your Niche Product From Overseas

We admit this process can seem scary. There’s a lot of weird language that comes with trying out this selling method, such as FOB (Freight on Board), T/T payment (Technical Transfer) and so forth, when you’re trying to communicate with a supplier. So you need to learn what these terms mean and go through the process of qualifying your supplier carefully and correctly to ensure they’re legit and are going to pack your order safely and securely.

Next you need to organise a freight forwarder or shipping company to ship out your goods. Yes all this can be bit intimidating when you think about the whole process, so it’s best to break the whole task down into more manageable bite size pieces to get started.

So let’s get go through a few steps so you can see exactly what you will need to do if you choose to source your product from overseas:

1. Decide what you want to sell

This can be the most difficult part of the process, however it’s also the most important to go through.  These steps include market research on the eBay Pulse, Terapeak and Completed Listings. Find a niche product and then niche right down into just one variation, style, colour and size etc and a few other accessories to go with your cluster. Make sure there’s enough profit in the product for you to reach your outcome, based on the cost price and how many you can sell of them per day / week.

2. Find a Supplier

This is where sites like Alibaba and Made-In-China are indispensible. There are millions of suppliers here if you’re after NO NAME generic products to import and in essence put their product catalogs online for you to persue and contact them. Locating a supplier is not a problem here but you will need to research and check your suppliers out, don’t just assume because they have great pictures that they’ll be a great supplier.

3. Ask for quotes

Here you need to spell out clearly and concisely what you’d like a quotation for. Remember, you may well be dealing with someone for whom English is not their first language, so keep your message simple and do not try and haggle on their prices straight away. This about building a business relationship not trying to get a cheaper price, in China cheaper price means cheaper product, they will make anything you want for the price you want but the quality will suffer.

4. Make sure to you do your due diligence on these companies

“How long has the company been in business? Make sure it has a physical location that you’re allowed to visit and that you can reach the company at that location, by calling them on that number.”

You’re likely to receive a dozen or more replies from suppliers and quickly, too. Now you need to do some due diligence on the companies that responded. Look at their Web sites also, do they appear professional? Are the products well described and photographed? How long has the company been in business?

It’s also worthwhile to note how long the company has been on the site you may have used to find them. Some of these sites will remove suppliers from their database if they get complaints about them. So if a supplier has been on the site for a couple years, that’s in their favour.

5. Meet the Australian Standards

Enquire with Customs to find out the tariff classification (payable taxes) and if you need to meet Australian standards and human standards (standards.org.au & customs will be able to point you in the right direction). You may not be able to sell your product in Australia if it doesn’t meet the up to date laws and standards.

6. Discuss payment terms

This is where it can really get hairy, if you don’t know what to ask for.  Not only are you and your trading partners strangers, but a different type of currency and 10,000 miles away from each other. Just as you’ll be careful to protect your interests, your new supplier will want to protect his. So you can’t expect suppliers to send you any part of your order without receiving part of their payment. But you’ll reassure one another by carefully laying out the payout of these payments and the use terms such as T/T to make sure the money is going directly to the company, if they send you an invoice that doesn’t look right then most times it isn’t. You should expect to pay 30% up front when placing the order and then 70% on completion of order before they will ship the goods to you, however terms will vary from supplier to supplier.

7. Settle on shipping

How will the items get from the supplier facility to yours? Depending on what you’re importing, this may be relatively simple and a surprising number of importers find they can easily work with companies like TNT, DHL or EMS. Alternatively if you are getting a container load of products then you may want to use a freight forwarder who will get your container from overseas to your port and through quarantine and customs before delivering to you. These are areas where a trusted supplier can offer advice and help.

So there you have it – some of the vital steps for the process of importing. Keep in mind that importing is NOT for everyone and is a long term selling method, so if it doesn’t feel right, it may not be the best selling method for you.

This process is also time consuming, so what will you sell in the meantime to keep the momentum going?

Don’t ever rush into importing, often you’ll have to order big MOQ’s and therefore big capital, therefore it’s worthwhile taking the time to get it right now to make sure you don’t miss any steps, or end up with the wrong items or more importantly paying for goods that are copies!

Be sure to do your research on your suppliers and always have 3-4 suppliers you are happy to go forward with, so if one supplier doesn’t turn out to be great then you have a few more to keep following through with.

Till next time, keep up the good work!

Matt & Amanda Clarkson

Bidding Buzz Ltd