How to Import from China in 7 Steps in 2024

Release time:2024-03-19 11:21

Import from China

Navigating imports from China can be straightforward with the right planning. Before placing your order, selecting a reliable shipping solution and freight company is crucial to dodge unexpected complications and delays. This guide offers three essential tips for a smooth import process from China.

 

Why import products from China?

Importing products from China offers significant opportunities for business owners looking to resell manufactured goods at a profit. China, a leading global production hub, exported products worth approximately 216.7 billion U.S. dollars worldwide in February 2023, maintaining its status as a dominant trading nation since 2013. The appeal of importing from China lies in the affordability of goods and materials, but success requires careful planning and research. Massive order quantities are common when importing from China, facilitated by large-scale factories designed for high-volume production. However, navigating the complexities of importing demands strategic planning and building strong supplier relationships to avoid delays and profit losses.

 

Sea freight or air freight from China?

Choosing between sea freight and air freight for imports from China involves considering speed, cost, and environmental impact. Expect door-to-door imports to take approximately 35-40 days via sea and up to 10 days via air.

 

 Air freight costs are based on weight, while sea freight costs depend on volume.

For instance, a 500 kg shipment occupying 3 cubic meters would be significantly cheaper via sea than air, potentially by 10-15 times.

 

 Additionally, the environmental footprint is much larger for air freight; for example, transporting 200 kg of goods from China to the UK by air can be about 20 times more harmful to the environment than sea freight.

 

 

Who should you choose?

Choosing the right shipping partner is a critical decision once you've determined your preferred mode of transport from China. Focus on balancing both cost and service quality to ensure a smooth importing process.

 

Freight forwarders are plentiful, each offering various shipping solutions from China. However, the disparity in freight costs can be significant, leading to the challenge of securing a comprehensive quote. To avoid unforeseen expenses, seek quotes that are all-inclusive, promising no hidden fees.

 

While it's tempting to take a freight forwarder's word for their service quality, it's wiser to consult reviews from their past clients for a more objective evaluation.

 

Remember, international trade involves navigating different regulations, especially between EU countries and non-EU countries. Additionally, importing or exporting certain items may necessitate specific approvals. Stay informed and prepared to manage these requirements effectively.

 

What should you be aware of?

It may seem convenient to have the manufacturer manage shipping from China to global destinations. However, this approach can lead to unexpected expenses, which often surpass the initial freight costs themselves.

 

We advise purchasing freight from China under FOB or EXW terms and conditions to prevent any unforeseen charges globally. To ensure a seamless experience without surprise costs, always secure an all-inclusive price.

 

Here are 7 steps you can take before importing products from China.

Step #1 - Choose products to import

For a successful import venture, it's imperative to first ensure the legality of importing your chosen items. Both the destination country and China have specific regulations that might restrict certain products.

 

Countries often have restrictions on items such as:

 

Meat, poultry, and animal by-products

Seeds, fruits, and vegetables

Cosmetics, medical products, and pharmaceuticals

Flammable materials

Tobacco and alcohol (without appropriate licenses)

Explosives and precious metals

Branded goods, regardless of authenticity

Vehicles and boats (without appropriate licenses)

Understanding both China's export restrictions and your country's import regulations is crucial to avoid legal complications.

 

Identifying a profitable product that's in demand and legally permissible to import is your next step. Conduct thorough market research to ensure there's a viable market for your selected product, and calculate your potential profit margins carefully. Being informed about the legalities and market demands will guide you in making informed decisions and establishing a successful import business.

 

Step #2 - Find a supplier

Choosing the right supplier is a critical step in the import process. Here's a breakdown of options for sourcing products from China, along with their advantages and disadvantages.

 

Factories:

 

Pros:

Lower costs due to direct sourcing

Flexible in design, Minimum Order Quantities (MOQs), labeling, and customization

Cons:

Varies MOQ options based on product trends/demands

Often provides poor customer support

Trading Companies:

 

Pros:

Broad selection of products

More control over quality control processes

Excellent service and customer support

Cons:

Limited design options for products

Higher costs for most products

Low to no MOQs, which might not be suitable for bulk orders

For those new to importing from China, partnering with a professional sourcing company might be the most beneficial route. This approach offers connections to reputable suppliers and simplifies the sourcing process. The cost for such services typically ranges between a 3 to 15% finders fee of the total purchase price, which is a fair trade-off for the convenience and reliability it brings to your sourcing efforts. This strategy can significantly reduce the risk and time involved in finding and vetting suppliers on your own.

 

Step #3 - Examine the product

Before finalizing your decision to import a product from China, its crucial to thoroughly examine the product you intend to bring into your market. Upon identifying a potential supplier, request product samples and detailed information regarding their manufacturing facilities. Reputable suppliers should be willing to provide these to you, allowing you to assess the quality of the product firsthand.

 

Although cost-effectiveness is an important consideration, the quality of the product should not be compromised. Ensuring high quality is essential not only for the satisfaction of your customers but also for the longevity and reputation of your business. Taking the time to verify the product quality upfront will pay dividends in the long run, helping you build a brand that customers trust and support.

 

Step #4 - Classification and calculation

After selecting your product for import from China, the subsequent step involves classifying it using a ten-digit tariff classification code. This classification is essential for calculating the applicable duty rate for your imports. Incorporating this duty rate along with the product and shipping costs will enable you to determine the appropriate pricing strategy for your customers to ensure profitability.

 

It's vital to approach this estimation process with diligence, as precise figures may only be available after receiving your initial shipment. Striving for accuracy in your cost estimates will help in preventing potential losses in revenue or customer dissatisfaction due to pricing issues. However, be prepared for the possibility of adjustments post-first shipment due to unexpected fees or fluctuations in costs. This flexibility in reconciling estimated costs with actual expenses is crucial for maintaining a balanced and profitable import operation.

 

Step #5 - Placing an order

When you're ready to place an order, be prepared for the nuances of dealing with Chinese exporters. Many require a minimum order quantity, often around 10,000 units, along with an initial deposit ranging from 30 to 50% to commence production. The balance is typically expected upon delivery.

 

For shipping, you have a couple of options depending on your needs and order size. Carrier airmail offers speed but can be costly for smaller orders. On the other hand, sea freight, suitable for larger orders or items, presents a more cost-effective solution.

 

Shipping configurations include Full Container Load (FCL) for exclusive container use or Less than Container Load (LCL) for shared container space. FCL becomes more economical with sufficient cargo volume. Regardless of the method, factor in additional time for factory-to-port transportation, potential customs delays, and other unforeseen interruptions to ensure timely arrival of your shipment. This forward-thinking approach will help mitigate any potential disruptions in your supply chain.

 

Step #6 - Prepare for and await shipment

To streamline your shipment's arrival, consider engaging a customs broker for paperwork, cost estimation, and regulation guidance. If managing independently, ensure the Import Security filing for sea shipments is completed along with initial documents like packing lists and bills of lading. Upon arrival, handle import duties and product retrieval. Inspect for damages immediately. Although the start may seem challenging, informed research and persistence pave the way to a profitable venture in importing and selling products from China. Networking and seeking advice can significantly ease your journey into this business.

 

Step #7 - Make payments to China

Navigating payments for imports from China involves adapting to recent changes where the Chinese government has allowed the Yuan (RMB) to appreciate. By purchasing and paying your supplier in RMB, you leverage a stronger negotiating position, offering them a valuable currency directly usable within their country. This strategic approach can result in more favorable terms for your transactions.

 

Summary

Importing from China offers significant opportunities for entrepreneurs looking to source products at competitive rates. By understanding key logistics like choosing between sea freight and air freight, selecting reputable suppliers, and navigating customs regulations, businesses can effectively manage their import operations. While the process may seem daunting initially, thorough research and strategic planning can lead to successful importing ventures, maximizing profitability and expanding market presence.

 

 

 

FAQs

What are the commonly banned exports in China?

Meat, poultry, and animal by-products, Seeds, Fruits and vegetables, Cosmetics, medical products, and pharmaceuticals , Any flammable fabric, Tobacco products, Explosives, Precious metals, Any branded products, real or fake, Boats or motor vehicles of any kind (without proper licensing), Alcohol (without proper licensing).

 

How can you ship to China?

You can ship either as a Full Container Load (FLC), which is using an entire shipping container, or as a Less than Container Load (LCL) which is sharing space with other shipments.

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What initial import documents do I need to show?

Packing lists, Certificate of origin, Bill of lading, Customs bond, Commercial invoice.