A few weeks ago, I mentioned in my weekly eletter that I would soon be giving you some advice with regard to sourcing products to sell online – and more specifically my advice and opinions on product sourcing from China compared with product sourcing from within the UK.
I get many, many emails every week from people asking for reliable UK wholesale sources for this product and that product, but the truth is, whilst I do regularly use some UK suppliers, I actually favour China and USA suppliers, mainly because I have always found that their prices are much more competitive – particularly when sterling is doing well!
If I wanted to source branded goods (which I personally don’t, but you might) then I would certainly consider UK suppliers first, to avoid getting into a situation where I could be uncertain as to whether I had sourced the genuine article or not.
However, when it comes to unbranded goods – which is the core of my online products, and particularly my eBay business – I look further afield every time.
Why you could be seriously putting yourself out of the running in achieving the best wholesale prices… and how you can start sourcing more competitively
There are two emails in particular which I have received in the past few years that stand out. The first was from a lady who had ordered what she thought were genuine GHD hair straighteners from a supplier in China, only to receive them and discover that they were fakes. Good fakes mind you, but nevertheless, they were only copies of the real thing. This lady was in a huge panic because she felt that she couldn’t knowingly sell them on eBay (and quite rightly so), because they weren’t genuine. She didn’t know what the hell to do with them now that they were eyeballing her in her spare room every time she opened the door.
I really felt for this poor lady, but I’m afraid that by the time she emailed me it was a case of shutting the door after the horse had bolted, because there was absolutely nothing I could do to help her at that point.
She had unfortunately already ordered, paid for and received her goods. Her best plan of action was to contact the supplier and try and negotiate a return and refund. Although this was a long shot, it was worth a try; but I didn’t hold out much hope for her, I’m afraid.
The second email followed a similar theme, this time from a gentleman who had ordered a large quantity of Braun razor blades – the Mac 3 type. These are extremely popular and sell well on eBay… However, again, this gentleman had unwittingly purchased fakes and only found out when the entire batch was officially confiscated by Customs and was subsequently destroyed.
To add insult to injury, he had not paid using a secure payment method, so could not go down the ‘chargeback’ route. So, this gentleman ended up with no stock and no possible chance of getting his money back.
As you can probably imagine, I really dislike receiving emails like this: situations like the ones I have just told you about can be so easily avoided…
So this week, I want to tell you a little bit about sourcing from China. I hope this will dispel some of the myths and confirm some of the truths that you might have heard on your online travels so far, and put you more at ease.
Yes – I agree: it’s scary!
Firstly, please don’t think that I don’t know exactly how frightening it is just thinking about ordering products from a supplier who is based internationally – wherever they are based; be it China, the USA or elsewhere overseas.
I’m not going to try and paint a rosy picture here and try and convince you that it’s so terribly easy to import products from abroad because that won’t give you a true picture. Remember: I’ve been there, done that; been a quivering wreck as I hit the ‘Confirm Payment’ button; worried when orders haven’t arrived on schedule; dealt with parcels being held up in Customs and not being released for two weeks – and all the other stuff that occasionally happens when you source products to resell.
You do need to know that the things I have just mentioned might happen to you. But also they might not. And you will find that if they do happen to you, you will sort it all out and learn something along the way.
Every step of your online business you take, including the inevitable mistakes that you will make, will actually teach you something positive – just remember that.
So, I know that because of these so called ‘problems’ that might or might not happen, it’s very tempting to want to stick within what you think is your comfort zone and with the good old UK suppliers, thinking that nothing can go wrong because we’re all in the same country, right?
You’re not wrong … but you’re also not right!
There are pros and cons to product sourcing, wherever your goods are originating from.
As you will more than likely be aware, China has become known as the ‘manufacturing centre of the world’. China manufacturers are able to produce virtually any type of product very cheaply, which has made them an absolute ‘must have’ source for practically anyone who is importing. But, I’m not just talking about the big businesses and brands sourcing their goods from China.
Small businesses, eBay and Amazon sellers like you and me, and other individuals who run businesses from home – we are all able to profit by sourcing our products from suppliers in China and other overseas locations. And sourcing this way can be very straightforward and not as terrifying as you might think, especially if you use some of the excellent Chinese wholesale websites.
I’ve noticed that more and more Chinese manufacturers, wholesalers and drop shippers are now putting in place safe online payment options such as PayPal and Escrow services, to give buyers like you and me more confidence to buy.
The number of suppliers doing this has increased considerably over the last eight years, since I started selling online.
Now, this is partly due to rising competition between the huge numbers of manufacturers who all want business from us. They have realised that they absolutely must offer safe, simple payment methods, better quality goods and a reliable service to stay a step ahead of their own competition.
So, knowing that more Chinese suppliers have safe methods in place, what’s stopping you taking a look around and seeing what’s out there?
You’ve got a couple of options when it comes to deciding what kind of supplier you should go for…
Of course, you will need to thoroughly research each supplier you are considering sourcing from, because business-to-business websites will actually allow any business to advertise their goods, so it’s important that you only source from companies on these sites that have been vetted by the site they are advertising on.
You can tell which companies have passed the checks because they usually have a kind of seal of authentication (which varies from site to site) next to their company details. Examples of these are ‘Trustpass’ or ‘Gold Supplier’.
You do need to make sure that you are dealing with real manufacturers and wholesale sources; not some cobbled together ‘supplier’ that has hastily created a website with no contact details and no guarantee that they will provide you with the goods you order and pay for.
And just whilst we are on the subject, it goes without saying that whilst there are many genuine, reliable Chinese suppliers that will always deliver quality goods, there are also lots of not-so-genuine suppliers who advertise counterfeit branded goods such as Apple iPods, Gucci handbags and sunglasses, Rolex watches, GHD hair straighteners, UGG boots and other high-end designer products – it’s very easy to be taken in by what looks like a good deal.
And that is why you have to be very careful.
Even though these branded goods are manufactured in China for their parent companies, the actual distribution of these goods is tightly controlled by each individual parent company – not the manufacturer – and the manufacturers can’t just go round supplying the product to anyone who asks: imagine what that would do the brand!
As you know, I rarely sell branded products and this, amongst others is one of the reasons why.
Judging by the amount of emails I get on this subject and the number of questions and source requests that arrive via The Source Report, another common worry is that you won’t be able to communicate properly with Chinese business people because of the language barrier.
But you shouldn’t worry too much because most overseas-based business people speak and understand English perfectly well, so telephone conversations and email messages simply shouldn’t be a big issue for you.
And there’s also a second option for you if the thought of researching trade sites and contacting manufacturers still terrifies you!
Start off nice and simply by looking at some Chinese wholesale websites. There are plenty of these around, so to start you off, take a look at the two below just to get an idea of the type of products that you might be able to source: ChinaVasion and AliExpress.
If you are a newbie importer, sites like these are great because you can purchase small quantities of goods, making it totally affordable for you and, importantly, very low-risk.
Now, although your wholesale prices from these sites will sometimes be higher than manufacturer-direct prices, that additional outlay is often worth it because:
You will have safe payment method protection – usually PayPal, Escrow or credit cards, all dealt with online.
If you are unhappy with the goods when they arrive, it’s much easier to deal with a wholesaler (and via Escrow or PayPal) and come to an agreement for a return rather than trying to find a solution with a foreign manufacturer.
So, I’ve given you a few options here which I hope will motivate you to take those blinkers off and seriously consider sourcing from overseas.