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For many online retailers these days, buying from wholesale suppliers from within their own country simply isn't the cheapest way to buy. Margins can potentially be much higher if they go straight to the manufacturer, who more often than not, is located in Asia. But is importing viable for small sellers? And what are the options available?
The SaleHoo product sourcing directory contains many international suppliers and staff are experts in the ins and outs of importing. They believe importing is simple enough for new sellers if they import only in small quantities and only generic-brand products (picking the fakes from the genuine brand is complicated and too risky). Many of their members start out this way, with the situation made easier by the fact that most of the Asian suppliers in the SaleHoo directory, whilst having vast inventories, are willing to sell as little or as much as SaleHoo member's want to buy.
Another advantage of importing in smaller quantities is that shipping simply becomes a matter of organizing a courier company such as EMS or UPS to pick up and deliver. The courier will also organize customs clearance and on small lots, sellers will be relieved to learn that duties and tariffs are unlikely to be significant.
Then, as your business grows, you have the option of scaling your importing accordingly. It's quite common for sellers to initially start off using drop shippers or light bulk wholesalers, as these types of suppliers can be easier to open an account with and usually don't have minimum order quantities (moqs). But as the seller's business becomes more profitable, they consider going direct to the manufacturer.
Of course, importing by the container load does require a certain amount of liquidity in the business, because it will easily cost $8,000+ all up ($3000-$4000 for the container and a few thousand on the product itself). Importing in these quantities is a fantastic way of cornering a market, but SaleHoo advises waiting until your business is established before taking this step. You need to have the infrastructure in place, such as a customs broker and freight forwarder, a warehouse to store your stock and staff to manage your orders and ship everything out, before this option becomes viable.
However, there are plenty of people who are "in-between" these two groups and SaleHoo caters for this group as well. If you've done the small-scale importing thing, but you don't yet have enough liquidity to go and purchase a whole container load on your own, then you can consider joining a buyer group. Although SaleHoo is not directly involved in setting up these groups, their community forum facilitates like-minded sellers who wish to import by giving them a place to organize buying groups. Groups are typically between 5-20 individuals and usually based around a geographic location to avoid unnecessary transportation costs. Group members split the costs and the tasks associated with organizing the import among members according to skills and experience. For many sellers, this method of importing is ideal as it allows them to get all the benefits of importing, without carrying all the risk.
Auction articles by Richard Seltzer
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