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We’re going to get into how to import from China. a candle manufacturing company where we
manufactured a ton of those little inexpensive
Before we go any further, I want to make a
candles. My company was partially bought by a
couple of quick disclaimers. First of all, I am
Chinese importer and we started importing the
not an attorney and am not able to give any
glass that we put our candle wax into. At the time
sort of legal advice. If I describe past personal
we were paying about .60 cents a piece for glass.
experiences, don’t take these as legal ad-
We imported the glass for something like .16
vice. Everybody’s situation is different. If you
cents a piece.
have a legal question, you need to seek out an
attorney and get their opinion and take their I saw the benefits immediately of importing, but
advice. Secondly, I am not an accountant or tax I had a partner who was a giant importer, so
professional, so if I mention taxes or tariffs or I didn’t need to learn all the ins and outs of it.
anything like that as far as goods coming in, A few years later, as I branched out into other
those laws and things change regularly. I am manufacturing businesses and got out of the can-
sharing personal experiences from my importing dle business, I needed equipment and supplies.
career. It doesn’t mean it applies to you. I started selling a lot on the Internet and was
thinking, “Man, it would be cool to direct import
What you really want is just the raw information;
some products and sell them online.” But I was
you want to know what to do and how to avoid
too big of a chicken to go to China by myself.
mistakes when you begin to import from China.
Well: here it is. Finally, I talked a friend of mine into going with
me on that first trip. He had never been to China
was more confused when I left than when I got know what you’re doing. It comes from many
there. I came back feeling really foolish after different directions. It comes from a tax and tariff
having spent all that money and time, so I started perspective; from agents and guys like that trying to
developing a little system: if I went back again, screw you; from buying incorrectly and buying for
what would I do? too much. If you pay too much for the products you
import, they may be worthless when you get them
My system involved how to get the best sources,
here. You have to take this seriously as a business.
how to get the best prices, and things like shipping
and duties. I documented it all, so the next time The upside to the importing business is that I
I went back to China, I had my homework done. have met very few importers who have been
I began bringing in a few products that I was importing for more than four or five years who
using in my own business; I brought stuff in for are not very, very successful. You don’t meet a lot
personal use and I brought stuff in to sell. of people who have become importers without
becoming successful. You meet a lot of people
I eliminated products based on things like the
who become importers for a minute, lose all their
marketplace being too small or the competition
money, and then go away. It is a little bit like
too big. Eventually, some patterns started to rise
stock brokerage or commodity brokerage: if you
and I developed a system for buying winners
don’t know the rules and how the game is played,
predominantly. Everything I have purchased has
you can get beat up pretty good.
not been a winner, but I have figured out how to
make money from the losers. This book aims to give you a strong education in
importing; a strong education in how to reverse
risk and put it back on the sellers and other
people; and even how to use other people’s
money to start your importing business. Even
if you don’t have a lot of money to invest, if you
have the knowledge and connections, typically
speaking there is more money out there than
there are knowledgeable people to run a
business like this.
Old Navy is a good example of the benefits If a product has a lot of price elasticity, you could
of importing. Old Navy is a clothing retailer. sell it for $5 online or you could spend the same
Most retailers sell a pair of jeans for $40 after product for $20, and spend $10 on marketing.
paying $20 for them from a designer, from a U.S. In this case, I would choose the higher price and
company that had it made somewhere and gone spend the money on marketing. I would absolutely
through all the steps. Old Navy figured out that dominate the competitor; I would crush them.
if they could import the jeans themselves for $2 There is no way on earth that they could get in
or $3 a pair this would give them an amazing front of the eyeballs that I could get in front of. This
amount of money to spend on marketing. This is is the reason I love the import business so much.
how they can run all those cool commercials and
run all those great, big stores in the really high The Consumable Market
traffic locations. They have an unfair advantage The import business consists of real merchandise
over the other clothing retailers as they have the and with merchandise that is consumable, you
margin to market and the margin to advertise. can often do the work one time and make money
for a long time. If you start selling consumable
Marketing things that come from China to the U.S., the same
If you don’t have a margin to market your customers will come back to you and buy month
products, it is very difficult in today’s after month after month after month.
marketplace to win. Everybody is marketing
Believe it or not, at some level most things are
very heavily. The Internet has created an entire
like the commodities business, for instance, at Christmastime? Probably 95%, right? The
there is no way on earth that will happen. You downer is that there is an established price for
will bring in for .80 cents and sell for a dollar. those. An eight-foot Christmas tree is worth, say,
However, for the most part, if you are going to $47.20. There are so many of them out there and
end use, this is what you want to do. they are fundamentally the same doggone thing;
that everything we had was good. a guitar pick factory in China. Their guy buys
all the extra guitar picks they have that are
Here’s what happens when you’re prime: your
overruns. He sells bags of guitar picks on eBay
market becomes global. We sold equipment
and he doesn’t make a lot of money on this, but
to England, Germany, South America, Brazil,
if you’re going to buy guitar picks, you really
Iceland, Canada, South Africa, Australia, New
want to buy them from him because he’s really
Zealand, and all over the place, because we
cheap. But who buys bags of 1,000 guitar picks
had kind of odd products for which there was a
I
f you’re going to do this yourself and really solete. We had to close out a bunch of heat
be in charge of the process, there is a way sealers and order new ones.
you have to go about importing.
If you ever run across a situation like this,
1. LIMITING RISK the best thing to do is get rid of the product
you have as quickly as you can for whatever
First of all, you have to do your product
you can get out of it. If there is a major
research. You have to know where your
development in your technology market, it
market is. You need to do some price testing
will quickly become the industry standard.
and some elasticity testing and to how much
stretch there is in the amount of money 2. SOURCING
people charge. You need to know the high, the
The next thing to do is find a source of
low, the in-between.
quality manufacturing and get a sample from
You also need to research quality. What them. You want to physically see an exact
features are needed, what features will representation of what you will get when you
people just not live without? One time we get your order, the understanding being that
were bringing in shrink-wrap machines and the sample is what will be in the container
we didn’t have a knife that cut off the shrink- when you get it.
wrap. People didn’t want our product. It was
3. NEGOTIATION
a new feature that another manufacturer
added and it basically made our stuff ob- Next you want to get your quote for the
You will deal with freight-forwarders and We import hand dryers that blow your hands
getting all the freight documents done. You dry, such a romantic business… We got a quote
will deal with your documents. Everything is on them and it was a fantastic price: they sell for
done in China based on a bill of lading and a about $400 each and we were buying them for
set of documents you have to have in order to $50. The quality was outstanding. We had the
receive your freight. factory send them labeled and branded. Because
we were known as an importer, they went above
8. DAMAGE CONTROL
and beyond and actually branded the samples
Lastly, we are going to talk about damage. At they sent us to our brand. Oddly enough, next
the last step of the process, what do you do if door to the building we were in at the time was
Dry Testing
Dry testing is another way to limit your risk. It is
basically seeing if a product is going to sell before
you buy it. There are two kinds of dry testing,
but we don’t do pure dry testing because I don’t
think it’s very ethical.
one for sale already. You can buy one and send it to put it out on the shelf for sale, and take orders
them, and ask them to make one like it. from it. If a lot of people ordered, then he would
go buy it from China. If people didn’t order it, he
However, there are patent laws and trademark
would write a letter back to the ones who did and
laws that apply. One of the worst things that you
say, “You ordered this, but after some internal
can do is get a container-load of something here
testing, we realize it’s probably not going to be a
that violates a patent. If you get the merchandise
good seller.” He was seen as a hero for protecting
here, you just can’t sell it, and you have no
them from a bad seller. Also, though, he was able
choice. If you start to sell it, you get is a Cease
to have a big display of stuff in his showroom.
and Desist. At that point, that merchandise is
absolutely the worst merchandise you can have This is what I call “the sticker method.” You can
because you’re not even allowed to liquidate it. actually scrape the other guy’s sticker off the
You just have to destroy it, and you have to pay to bottom of the product and set it. In order to do
have it destroyed. It’s the worst possible problem that, you have to know your market and know
What I suggest you do is build your prototypes Those are some ways that you can limit risk.
on the States side, send them to China, and say, Limiting risk is a theme here, because the main part
“Make me an absolute duplicate of this.” They’re of this is that you can make a lot of money. However,
fantastic at duplicating things. They’re not very if you don’t take some of these steps – or all of these
good at creating things from concept. steps – to limit risk, you could really get caught with
your pants down and get broke real fast.
Later on, as you get savvier, you’ll learn how to walk
somewhere between eight and fifteen percent to they have to make a lot of money on the front
go out and put together your deal for you: to source and backend of you to make it work.
didn’t have a back door deal with a factory. “real China.” That’s what I call it anyway. When
you’re in Shanghai, it’s all pretty and shiny. It’s
So they’re going to be charging you on your side.
westernized. Hong Kong is incredibly westernized,
They’ll swear to everybody on earth that they’re
too. However, when you’re in Guangzhou in
not making any money on the back side and
Southern China, you’re still really in China. A huge
that is bullshit; they’re all making money on the
percentage of what’s manufactured in China is
back side, every single one of them. That’s just
manufactured in the south, in Guangzhou. This is
something that you need to accept, deal with, and
because a lot of the raw materials are down there.
get over. As long as they are a quality agent and
providing you some services, then that’s just the It’s in Southern China.
nature of the beast. You can also go to a Stateside broker. If you use a
There are basically three agents. I typically avoid Stateside company you need to make sure that they
Hong Kong and Shanghai agents, especially Hong have an office in China. You need to get the address
Kong agents. I’ve never had a Hong Kong agent and phone number of the office in China, and
quote me a reasonable price on anything – ever. be sure to call the office and make sure that they
If you’ve not been to Hong Kong before, it’s an aren’t full of crap. You’re going to have to do a little
incredibly international metropolitan city. It cost due diligence here when it comes to your brokers.
If I’m going to Guangzhou I fly on China Southern morning. This is China. Even if every room in
Airlines. The reason that I fly on China Southern the place was empty and check-in time was three
Airlines is because I can fly China Southern out o’clock, you’re going to get to check in at three
of L.A. first class for not much more money than o’clock because they’re not going to break a rule.
The other thing that’s really good about all of it. More importantly, if he comes from the hotel,
these is that they all have shuttle buses. They will he probably knows how to get back to the hotel!
Keep your hotel room key with you at all times. It I like going to the old center the first time at the
usually has a logo on the front of it and a map on the Canton Fair because, typically speaking, there are
back. You can ask them to draw you a map back to more translators down by the old center because
the hotel, too. You can be almost certain that the cab it’s near the university. There will be hundreds of
driver that you get will not be able to speak English. young men and women from the college holding
up signs that they translate. Some of them translate
into French, Spanish, and Russian. However, there
CHINESE CELL PHONES
will be more English translators than anything else.
One of the first things that I do when I go to
You need to go along and talk to them. Don’t just
China is get a Chinese cell phone. Inexpensive
pick one based on their looks or that they seem
cell phones are less than $100 in China. It’s going
nice. You need to ask them a few questions:
to be a pain to use, but on any budget you can go
get a phone and have some minutes. It gives you “Tell me how you’d order a cheeseburger for me
credibility and some safety. if I was going to McDonalds. I want a Big Mac
with cheese, no onions, two packs of fries, and a
They’re just not going to treat you the same way
if you don’t know the game, if you don’t look coke. How would you say that?”
like you know where you’re going. With the cell See what they say back: it might be surprising to
phone you can talk to your other people. You you. You need to speak relatively
need to exchange numbers if you’re going to go
slowly and give them a fair shot. For the most
in a group. I assume that you’re not going all by
part they’re going to be able to do all of this little
your little lonesome, especially the first time. You
stuff that we’re talking about, like getting you a
shouldn’t. So be sure to exchange numbers with
cell phone and minutes.
whoever you’re with.
You’re going to be able to find a translator to work translators on two occasions. On two occasions
Another thing to do online while in China is find say no, the one word that will get you all the
the factories in Guangzhou so that you can go samples you want is FedEx: “Here is my FedEx
and tour the factories while you’re there. One of account number.”
the best deals that we ever found on a product
If you’re willing to give them your FedEx account
came when we were buying stanchions – the
number to ship the sample from, nine times out
little stands you find in airports. We got an okay
of ten they’ll give you the sample. If it’s less than
price at the fair, maybe $18, but we had a little
$50, they’re almost always going to give you a
extra time in China so we started searching
sample for free – as long as you’re willing to pay
for stanchions. We found a supplier – the one
that we have now – that just happened to be in the FedEx to ship it home.
Guangzhou, about 15 minutes away from our A lot of times I have cash with me when I’m
hotel. We called them up, took a cab right out to
at Canton Fair. I’ll give somebody cash for the
their place, and toured the factory. We ended up
shipping. They’ll call and get the shipping price,
buying stanchions better than the ones that we
then I’ll just give them the cash at the show. If I lose
had for $12.40 a piece. Not only that, but they
$50, so what? So far I don’t think I’ve ever had a
had two other lines of totally different products
single person that I’ve given FedEx money to send
that we were able to pick up.
me samples not send me the samples. For the most
Importantly, when you’re in China at the part, Chinese people are incredibly honorable
Guangzhou Fair, you’re going to see items people. They’re not cheats by nature. However,
that you’re looking for and see what they’re they’re not going to waste a lot of time or effort
classifying them as. Now you can go back to
to do a quality job for you if they don’t feel like
http://www.AliBaba.com and search with the
you’re going to be around as a customer for them.
proper search reference. You’re going to find a
If you’re not worthy of a relationship, they’re not
ton of factories that you didn’t find before.
going to treat you with relationship potential.
is the most important person in that company business card directly, if you want, even if you’ve
is probably in the far left or far right corner of given one to the assistant. You should ask for a
the booth, sitting in a corner, reading a book prospectus on their company. Pretty much every
or newspaper. They’re going to have a number manufacturing company in China has a prospectus
of people in the front of the booth waiting on – like stock companies do in the U.S. – that tells
people. They’re going to immediately ask you you what their turnover is. It has picture of their
for a name card. When they go to give you a factory and bios on their executives. Although a lot
business card, ask them to please give it to your of times these are in Chinese and you can’t read
assistant. Don’t take their business card and them, it’s a good idea to ask for them.
don’t give them your business card. Have your
If you look like you know what you’re doing,
assistant exchange cards with them.
they’re going to treat you like you know what
The vast majority of the conversation needs
you’re doing. If you look like a chump, they’re
to be between you and your assistant. In a lot
going to treat you like a chump. They would
of cases now, the person at the booth speaks
never do business with a company that they
very good English; still, it’s not a good to talk to
didn’t thoroughly investigate first. They’re
those assistants. In China, if you’re talking to
assuming that if you’re not going to investigate
the assistant, you’re assumed to be at the level
them, you’re not doing your due diligence; you’re
of their assistant. It’s a class system. It’s better
probably not a very viable person. So, you want
to have your assistant speak to theirs. Then, if
to ask for a prospectus for their company.
you’re more interested, have your assistant ask,
“My boss would like to set up a meeting with
When I go to China, I’ll look at 200 opportunities are: whether or not people are going to be able to
while I’m there. I’ll hone that down to five or ten, tell that it’s a Chinese product.
Another thing you can do with branding is wide world. We almost did. We were going to
establish a name brand. We had a product we buy a container of big luggage carts for hotels. In
were bringing – a stanchion product – some the midst of it, we were sending out a couple of
time back and we branded it. So, we own our feelers to our customers, sending them a picture
own brand name of those. If you go to the brand of the luggage carts. We had Harrah’s Casinos
name site for that product, they’re $170 apiece. and a bunch of other people that were customers
It’s a very corporate-looking Web site. Guess of ours. Evidently, one of them had a good
how many get sold from there? Practically none, relationship with a guy that owns this company
because we don’t promote that site. here in the States that makes luggage carts, and
happens to have a patent on this particular type
We’ve got a discount site that sells other people’s
of luggage cart. Before we could even buy the
stanchions and our stanchion. On that site, we
container we got a Cease and Desist letter from
sell our stanchions, discounted 60% off, for $77
the manufacturer of the patent holders. They said,
apiece. If they don’t believe our 60%-off price,
“We have a patent on this. You can’t sell them.”
all they’ve got to do is go over and look at the
corporate Web site that lists how much they are. The Chinese factory would have never told us
It’s called “decoy pricing.” Basically, it really that. All the Chinese factory did was buy one of
works well, and a lot of companies do it. There’s this guy’s luggage carts in the States, bring it to
nothing odd about it. It’s the way the outlet China, and knock it off. They don’t care about
mall business works. You’ve got Kenneth Cole trademarks, patents, and all that. In a lot of
selling a watch in a department store for $200 cases, it doesn’t apply there. They would have
so he’s establishing the value of that watch at very easily sold us those. We could have gotten
$200. When you go into the Kenneth Cole Factory them here, we would have paid for them, and we
Outlet and that watch is $60, you snatch it up, would have gotten them to our warehouse and
no questions asked. For what it’s worth, those paid the freight. The day we went to sell them…
As a matter of fact, in a situation like that, you then we’ll have to talk about whether we’re
can tell them easily, “I’ve gotten quotes on similar going to continue our relationship or not by the
products as low as $12,” if you’ve got legitimate time we place the next order.”
quotes. Sometimes they’ll ask you who the company
Let them know right up front that if the price
is. If you can reach in your bag and pull out one and
doesn’t work out, you’re going to go elsewhere.
really show them, most of the time, they’ll meet it,
Just don’t let them think that you’re agreeing to
almost every time. However, if you’re just B.S.ing
the price they’re giving you forever.
your way through, they’re not going to buy that.
nothing or very near nothing to have that done. them for $20 to $70. From a manufacturing
You’ve been in Wal-Mart before and picked up standpoint, it didn’t cost a whole lot of money.
a ceiling fan. You see the whole side of the box Typically, people would throw them away and
is full-color graphics. That stuff in China costs buy another one. However, we started getting a
almost nothing. It costs a couple pennies more ton of calls asking for replacement elements in
than a regular box. They’ll just give it to you. these particular items. What we were able to do
It’s almost no sweat off their back at all, but it here was to go back to the factory and negotiate
can make a huge difference for you when you individual kits of three or four additional
go to sell. Remember this: if they agree to that, elements in the package. We just complained to
you’re going to have to get artwork over there in the factory that the elements were burning out.
enough time for them to get your box printed. They said, “Okay. Next time, we’ll just put four
extra elements in.” I said, “How much is that
I also always request double boxing. I want my
going to be?” They said, “No charge.” They cost
product boxed, then I want it put inside another
two or three cents apiece.
box. That will eliminate as much as 90% of your
damage in freight. Typically speaking, again, Here’s what we’d do. When we would sell one,
they’ll do that for free or very close to free. If we would ask the customer, either on the phone
you’re talking about a dollar item, they may not or on the Internet, “You’re buying the heat sealer.
do it for free. If you’re talking about a $20 or $30 It’s $29.95. Is that right?” They’d say, “Yeah, that’s
item, they’ll almost always do it for free because right.” We’d say, “Sometimes the heat elements
it costs practically nothing. burn out in them. You can get four extra heat
elements for them so it will last a whole lot
Then ask for free add-ons that you can then
stamp for $12.95 or $13.95 that cost us about letter. When you’re writing that order, you need
two dollars. We got bottles of refill ink from the to be ultra-specific. You need to talk about what’s
factory and we would offer the refill ink for the included. You need to talk about the gauge of the
metal that’s used. The quality of everything needs
rubber stamp for $4.95. Almost everybody took
to be totally gone through.
the refill ink, which paid 100% for the cost of the
rubber stamp and the refill ink. If you grasp that Another thing: you need to absolutely get hard
concept from consumer goods, you will go very completion dates, along with penalties. Typically
far in importing. I don’t care if you’re a little bit speaking the standard manufacturing time in
slow, but if you can sell products and make 100% China for most everything is 20 days. You need to
of the money, you’re going to do okay. have is an automatic cancel, or financial penalty,
or something built into that order to make sure.
It’s like a house builder: they don’t want to give
That is what the big guys do. The big guys say,
you the home at a drastic discount because
“Look, you want $10,000 for this order, okay. I’ll give
they’ve got other people who are basing
you $10,000 and it has to be delivered on the 20th.
their price somewhat off what you’re paying.
For every day that you’re late there is a $100 penalty
However, they’ll be willing to throw in upgrades.
that we will take off of the rest of the invoice.”
lot of problems with that is, if you don’t know that money is sent to China: letters of credit and
when you tell your people in your order that account that you don’t have control of anymore,
although the money is still there in your local
quality control will be handled by SGS Testing
bank. They’ll issue the letter of credit to the fac-
Laboratories, guess what? They know you’re no
tory and the factory will take it to a Chinese bank
joke. They’re not going to mess with you at that
and that bank will give them a loan on your letter
point. You’ve done everything throughout the
of credit so they get the money to buy the raw
entire process to show that you’re a professional,
materials to build your order. They will build your
all the way down to having a reputable company order and it will ship to the United States.
coming out to do quality control.
When the order gets to the States you can’t
Shanghai trading company, you can get a rebate Why don’t you split the VATs with me? Let’s split
from the government for your own exporting. the VATs. If you want my business you’ll split VATs
In other words, you would buy your products with me.” A lot of times they will. I didn’t get that
domestically by having your Chinese company buy little piece of data right there until I had been to
the products domestically in China and you pay the China at least six or seven times. This could save
price the factory wants. When you export the goods you tens of thousands of dollars, or even millions
out of China to the States you can apply for those of dollars over time if you’re a big importer.
government rebates at the end of the year. If you’re
tariff is the same thing. It’s a tax. It’s saying, make my candles with, I brought in a couple of
if you’re bringing this product from China we containers of wax and the duty was zero. So I’m
charge a percentage of the total invoice amount bringing in one container of candles and I’m
as a duty. You’re freight forwarder is going to paying 70% duty, and I’m bringing in another
pay it and you’ll pay them back. That is another container of wax and I’m paying zero duty. I ain’t
thing that they will handle for you. Once you the smartest guy in the world, but believe it or not
go to China and you get ready to buy, you’re not I did that for a year. One day I’m waking up in the
going to finalize anything until you talk to your morning and this ding went off in my head and I
freight forwarder. If you want to get the duty said, “What is a candle?” I called up customs and I
charges call the freight forwarder and say, “What said, “Can you tell me, when you’re looking at the
are the duties going to be on this?” There are classification of the harmonize code for a candle,
some things that you can bring from China at what constitutes a candle?” “The definition of a
different times that have extremely high duties. candle is wax with a wick in it.” I said, “So you’re
Those are things that have a high duty on them telling me that if I brought in candles that had no
as a penalty. Meaning that there is strong lobby wick then those would be wax, right?” “Absolutely.”
You have to have people ready. They’re going to something called a “trade-free” zone. When you
bring a container of merchandise into the US that
drop that container off, and when they drop it off
is an asset at that point. You own that and you
you have a couple of hours to get that container
could owe taxes on that depending on where you
unloaded. You can pay for a couple of extra hours
are. In a trade-free zone, the government allows
but it’s pretty expensive. If you have a truck stop
you to leave that merchandise in the trade-free
near you, go to the truck stop and ask if there are
zone without any taxes until you ship it out of the
any “lumpers” that want to do any work. They
trade-free zone. In other words, you don’t have
usually have some guys hanging around truck
to pay tax on inventory that is just sitting there.
stops that do nothing but load and unload trucks.
A lot of times it’s the duties as well. So instead of
You can get some lumpers to help you come and
paying on an entire container, you only pay on
unload your container into your warehouse. the part that moves out.
you’re shipping something into the US from them in on a 20-foot container, but we also
China, 99.9% of the time you’re going to have brought in these key control boxes that are big
three different kinds of containers to ship on. hollow metal boxes for holding keys. They don’t
You’re going to have a 20-foot standard con- weigh anything. We would top load the container
with the empty, hollow boxes, and the bottom
tainer, which holds small lots of stuff like the
would be loaded with the heavy metal bases and
guy that brings in key fobs. He may not want to
the container would come in chock full.
bring in a whole 40-foot container. Usually what
you use short containers for are things that are The bottom line is you have a certain amount
very, very heavy. The reason you do that is be- of cubic feet and you’re going to have a certain
cause no matter how big the container is it can’t amount of that on a container and you’re going
weigh over 56,000 pounds. If you have a 40-foot to try to fill every inch of that cubic feet that you
container and you’re bringing in car batteries, a can, for two reasons. One is efficiency. You want
huge percentage of the container is going to be to get the most for your money. You’re paying for
it you might as well use it. Two (and this one is
wasted because you’re going to have more car
almost as important if not more so) you want that
batteries in weight than you fill in space. There
container packed, jammed up, and jelly tight.
is a way around that where you can make that
You don’t want any room for movement inside
work for you if you’re pretty savvy, but for the
the container as that is where damage happens.
most part what people will do if they’re bringing
Look at the way movers pack houses. When you
in something really heavy is they’ll bring them
get professional movers to move you from one
in on 20-foot containers. The 20-foot container
city to another they won’t use the whole truck.
is about 2/3 of the cost of a 40-foot container. It’s
They’ll push everything to the front of the truck
not an even half. You’re going to pay more for the
and they’ll have everything so squished in there
20-footer, but it’s still cheaper.
you think it’s going to turn into one big blob of
I’m not going to go into the duties on this and eBay And Craigslist
the duties on that and get into real detail. To be
What I will do is take a look at a lot of my
honest, the freight forwarder handles all of that. I
damaged goods or overstocked goods and I’ll
never had to learn it. I’ve brought more products
determine what the best strategy is to liquidate
into the States than most people have and if I’ve
the product. Number one, I go to eBay. You’re
never had to learn about duties and all that, you
not going to get any more out of the product that
shouldn’t have to either. It’s not really a big deal.
you’re liquidating then you are going to get out of
Most cities, or most larger cities have liquidation we’ll give you $17,000 and you keep the freight.”
auctions. They’ll usually have them once a week I’m pretty good at liquidating so if I can do it
or at least once a month. They are often called I’ll take the lower amount from the insurance
S
o: that was the whole process. Sourcing.
where I’ve actually made more money from a
How to get your samples. How to get a great
losing container than I’ve made from a winning quote and a great price. Customizing your
container because I have $.90 on the dollar for products and value-adding and getting the most
the goods and got a $17,000, $18,000, or $25,000 apples to oranges comparisons that you could
possibly get. How to place your final orders, how
check from the freight company. There is a
to get proper quality control, how to negotiate
possibility that can happen. Is that a business
great terms with the factories, how to work with
model? Hell, no. It doesn’t happen most of the freight forwarders, and how to deal with shipping,
time, but occasionally it will happen. customs, and tariff issues. Even what you can do if
you happen to get damaged goods.
Recouping From The Factory
That is everything you need to know to be an importer,
With damaged goods though, your number one and that’s assuming you probably want to go to China.
avenue is to try to get the factory to make it right. Good documentation, talk to the right people, and
Most of the time they will do their very best to negotiate fairly and I think you’ll do just fine.
make it right if there is any possible way that I love, love, love being an importer. It’s a cool
they can. If I get damaged goods in and I am able business to be in, first of all. It is sexy. You never
run out of stuff to talk about at parties. You do
to overcome it, when I place my reorder I will
have some damn interesting stories if you do this
ask the factory for a credit for whatever it was
enough times. Some weird stuff is going to happen
that it cost me. “I’ll tell you what. You guys really to you. I had a friend of mine that got locked in a
messed me up on that last order.” They’re going Chinese toilet for almost an hour once.
to start calling and emailing you, “Are you ready Why do I do it? Complete, 100%, market
for another order?” “No, you really messed me domination. I don’t like to play on an even field,
up on the last order. It cost me $10,000 to get that bottom line. I’m an importer. I don’t care who you
are for the most part, you can’t beat me. If you
crap fixed. If you want to give me a $10,000 credit
want to manufacture against me I will beat your
on that last order I might try you again. I might.”
brains in. I have no labor costs to speak of. The
Don’t ever give them a sure thing. “Oh, okay, factories that we use in China and the factories
okay.” Normally they will do it and they’ll cover that are mine in China, we can just kill anybody
as far as manufacturing goes. If you’re going to
whatever it was that cost you to remediate on
import against me you’re probably not going to be
your side of the fence. That is another way that
as good as I am. You’re not going to know all the
you can make money on damaged freight.