Most new importers tend to become too excited to get things done right away that they forget some of the most important things to consider when doing business with Chinese manufacturers.
For first timers, it is important to comprehend the steep learning process that is normally understood after doing 2-3 shipments. By that time, you will finally understand the entire process, terminology and acronyms involved in China International Trade.
In case of limited understanding on the entire import process and the working style of these companies, here is a list of the top 5 common mistakes that new importers mostly make.
Urgency leads to disaster
As new importers are excited with their new ventures, they tend to demand urgency with their orders. Though this is understandable for new entrepreneurs to become exuberant, moving too fast can sometimes cause disaster and misfortunes.
Urgency can sometimes result to failed quality control, skipped important procedures to cut short the production time or worst, losing good suppliers who can produce quality products but cannot cope with the urgency of delivery times. All these issues can lead to quantitative loss and huge problems over the course of time.
“Like for Like” specifications
New importers mostly start their sourcing process with B2B websites like China Homelife. The process involves reaching to multiple suppliers, acquiring quotations, comparing and identifying the best suppliers.
Sadly, importers do not properly compare like for like specifications unintentionally. There are differences in the product such as materials, paint, components dimensions and other important specifications that influences its overall pricing.
Overestimation of the Profit Margin
First time importers usually overestimates the profit margin on a specific product due to the basics of international trade. Even to some of the simplest international trade transactions involving several parties, it is hard to calculate the overall cost of product and therefore the expected profit.
Lack of Realization when it comes to Economies of Scale
New importers are static to start their business and do things necessary for its progress. As a result, they tend to fail in realizing the “Economies of Scale” and how it actually works. This one is a difficult process as it takes a while before you can get accustomed by the processes and procedures when importing products from China.
Expecting too much on small orders
We all want perfection but remember that it always starts with mistakes. This is probably the one important thing that every importer should know. It is very hard to expect perfection especially for smaller orders on your first manufacturer. There are certain things that influences the failure to achieve “Perfect Product” like economies of scale and the perception of factory workers/production to what you consider perfect and acceptable.
Importing products from China can inflict good advantages to your business. But for first time importer, it is important to consider the things that needs to be avoided for first timers so you can achieve your goals without suffering from eminent loss. Remember that with limited understanding when it comes to the overall import processes and working styles of Chinese factories, quality risk might incur and great losses might happen.
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