China is a favorite business destination for most small and large retailers. Entrepreneurs think China when looking to buy affordable goods, import, and then sell for profit.
Though China is a known manufacturing zone for nearly all consumer products, it can be challenging to import items from there, more so if you’re a new merchant.
You may find the sourcing of goods costly, confusing, and time-wasting. This potentially profitable deal can harm your business and affect your ROI because of expensive shipping, delays, compliance fees, etc.
4 Things to Remember When Importing from China
If you’re considering sourcing items from China, follow these steps to enjoy a hassle-free import process:
1. Understand your Rights as an Importer
You fit the definition of an importer once you purchase items from China, whether bulk or small. Before buying any commercial products for your United States business, it’s crucial to check if you have the legal right to do so.
For US retailers, you’ll need to provide your business’s IRS (Internal Revenue Service) number. Those who apply solo can rely on their SSN (Social Security Number).
2. Which Goods to Import?
A retailer’s win is to make profits off the goods they import. Choosing the wrong items is, therefore, a waste of finances and time. It affects your standing and threatens to bring you down, especially if you took out business loans for this project.
Spend quality time investigating the suppliers lest you end with products that don’t match your brand or customers’ needs.
Calculate your profit margin to put all things into perspective. Consider the product prices, shipping fees, and any other legal fees to get an accurate figure.
3. Are the Goods allowed to Enter?
The US, like all other nations, has a list of prohibited items. Generally, the law doesn’t allow you to import these goods. If you choose to import anyway or do so out of ignorance, your products will be confiscated by customs officers.
Even worse, you may wind up with lawsuits and fines, incur further unanticipated expenses and suffer more losses.
4. Understand the popular Payment Avenues
When dealing with an overseas supplier, you must consider the payment methods. What are your options?
Because you can’t pay with your business credit card as with local suppliers, be willing to shift to a method that favors your Chinese partners.
Understanding the entire process upfront simplifies your work down the road. Follow the above tips to ensure a smooth import process.
Author Bio: Michael Hollis is a Detroit native who has helped hundreds of business owners with their business loans. He’s experimented with various occupations: computer programming, dog-training, accounting… But his favorite is the one he’s now doing — providing business funding for hard-working business owners across the country.