How to Import From China to Sell Profitably in 2024 (2024)

This mega guide will give you all of the information you need to get started importing from China: Everything from finding the perfect product, negotiating with suppliers, to figuring out the best way to ship your items.

Why Import from China?

If you're thinking about importing from China, it's probably because you want to start selling on Amazon.

When it comes to selling on Amazon, there are basically three business models:

• Retail Arbitrage – Buying goods for cheap from stores and reselling them online
• Dropshipping – Buying goods from distributors and wholesalers and selling online
• Importing from China/Private Labeling – Finding products to import from China, sometimes with some light product improvements, and selling them online

The most popular business model when selling on Amazon is by far private labeling. When you buy a product on Amazon and you don't really recognize the brand name, but it's cheap and has a bunch of reviews, that product is probably from a private label seller who's imported some goods from China and listed them on Amazon. There are some Amazon sellers who still do retail arbitrage and dropshipping but it's less and less popular now.

There are many reasons why importing from China is so popular. Here are some of the reasons:

• High-profit margins (andmuch higher than drop-shipping) means you can make a lot of money
• It's easy to import into America (even for non-Americans)
• Developing real, tangible products and selling them is exciting
• No need to travel to China to find products
• But if you do travel to China it's fun and adventurous

How Much Money Can You Make Importing from China?

Ecommerce has been booming in recent years (and that's probably why you're considering importing from China) and there are a lot of people making a lot of money. Ecommerce has always been a quickly growing trend but it has become even more popular since the COVID-19 pandemic. With that being said, as the opportunity grows, so too does the amount of competition (more on that later).

I have personally started and sold numerous 7-Figure (meaning $1million+) ecommerce brands built around importing from China. The first business I sold was Anchoring.com in 2016 which I sold for $867,000 (see the entire post here). My EcomCrew partner Mike Jackness has done the same, selling his brand ColorIt.com for just over a million dollars in 2017 (see his podcast here). Today, we continue to run several brands in various niches from off-roading to baby products doing close to $10million in sales.

How much money can you make? Well, it all depends of course, but a big factor that will affect how much money you can make is how much money you have to invest. Most people are looking to either double or triple their money each year. So, for example, if I invest $1000 into buying products, I expect to make $2000 to $3000 at the end of the year. Some years are better than others of course and no matter how good the year is, how much money you can make will largely depend upon how much money you have to invest. Later in this article, I'll talk about how to stretch your money further and get access to lending.

What You Need to Get Started Importing

The most important thing you need to import from China is money to buy inventory. Generally, I recommend having at least $500 to buy inventory and ideally $2000-5000.

You will also need an Amazon Seller Central account if you plan to sell on Amazon. This will cost you $39.99 a month.

Can I Still Import from China if I'm not American?

We have a lot of readers of this blog all over the place, including Canada, Europe, and India (I myself am Canadian). Thankfully, the United States makes importing products and selling them VERY easy for both Americans and non-Americans.

For smaller value shipments of $800 and below, you don't need any formal paperwork to import into America and you won't even pay any duties or taxes! For larger value shipments, the paperwork is very easy, even for non-Americans (and you won't need a U.S. business).

Needless to say, you do not need any Chinese language knowledge as well. Almost all Chinese suppliers who export have English language websites and sales catalogs and at least a couple of staff members with reasonable English.

How to Find Home Run Products to Import and Sell on Amazon

The big question you're all probably asking now is: how do I find a GOOD product to import from China?

When you're importing from China you're basically looking at private labeling products. This means you're taking an existing product, putting your brand on it, and possibly making some light product improvements.

When I'm looking for products to import I'm looking for three basic things:

• Little or no “optimized competition” on Amazon (this basically means their product pages on Amazon are poor, with bad images and little use of paid advertising)
• Products that can be profitable to sell
• Products that I can easily improve

I cover how to find products a lot more in thepost how to find the perfect product to import from China and sell on Amazon.

Good and Bad Products to Import from China

China is the factory of the world but there are certain products which are good for small importers and others which are bad. Identifying good and bad products basically comes down to understanding two critical differences between China and Western countries:

• China is a developing country with different quality standards from the West
• China has different norms around intellectual property and there are a lot of counterfeit products

Chinese factories make a lot of crappy products but also make a lot of excellent products. One of the ways to avoid crappy quality products is to import simple products. Example products would be mouse traps, garlic presses, and furniture. More complex products are more likely to have quality issues such as electronics and electrical items. Several years ago, hoverboards became a trendy item but unfortunately they were banned from Amazon soon thereafter because many of them had severe quality issues and starting suddenly exploding – this is a good example of a complex product with poor quality.

For nearly 10 years of running this blog, there's a few product categories that I routinely see new importers run into troubles with: electronics, electrical items, baby items, and digestible items.

Finally, China is home to a lot of knock-offs. You will find a wide variety of counterfeit products to import including products that violate trademarks, copyrights, and/or patents. It's a very bad idea to import counterfeit products – they may be seized at the border, Amazon may suspend your account, and even worse things can happen.

Don't do it.

Alibaba & Beyond: How to Find Great Suppliers in China

China is an incredibly safe country (the32nd safest in the world). It has a strong legal system and being scammed is veryrare.

Your primary concern will be ensuring quality products. Chinese factories won't steal your money but they may send you inferior quality products.

The most popular places to find suppliers are:

• Alibaba/Aliexpress
• GlobalSources
• 1688.com (basically the Chinese version of Alibaba)
• Trade shows such as the Canton Fair
• Using import records
• Yiwu
• Sourcing companies/trading companies

The most common place to find suppliers are onAlibaba and Aliexpress and we have an excellent guide on using Alibaba.

Alibaba is basically a directory of factories and suppliers in China. Aliexpress is very similar, but is basically a directory of trading companies (resellers of the factory's goods) and has higher prices but lower minimum order quantities (MOQ) than Alibaba.

Almost everyone will use Alibaba at some point in their importing journey. Even Chinese companies use it, although they'll normally use the Chinese version of the site, 1688.com. There's nothing wrong with Alibaba and it's very safe – the biggest issue is thateveryone is using Alibaba and so it can be difficult to find products without dozens or hundreds of competitors already on Amazon.

I like to try and find suppliers that aren't already selling to other Amazon sellers. Because of this, my preferred method for finding a supplier is by visiting trade shows (although that's quite a bit harder with COVID now). The best suppliers often do not advertise on Alibaba but do attend trade shows. The Canton Fair is the largest trade show in China but there are thousands of trade shows going on in China every year.

Sourcing companies and trading companies are basically companies who will do all the grunt work of finding products for you. They don't actually make any products themselves. A lot of people shun trading companies and sourcing companies because it'll often mean prices 5-15% higher than factories, but they have a lot of value including being able to source difficult to find products and ensuring higher quality standards.

Trading Companies vs Factories – Which is Best for You?

In China, there are two basic types of suppliers: factories and trading companies.

Factories manufacture products. Trading companies do not manufacture products but source lots of different products from different factories.

In general factories have lower prices than Trading Companies but higher minimum order quantities and less product selection.

Often the supplier will say in their company namemanufacturerortrading company so they are quite easy to distinguish. If in doubt, ask your supplier what type they are.

Neither trading companies nor factories are inherently bad or good. Trading companies (normally) have lower MOQs and better quality controls. Factories (normally) have lower prices.

Ordering Samples and Making Your First Order

When you're getting ready to place your first order, there's two things you need to know about: samples and Minimum Order Quantities.

Samples when Importing From China

Once you find a supplier for your product, most people want to order a sample first from that supplier. A sample gives you an idea of the overall quality of the product from that supplier and is normally the last step before you proceed to a bigger order. Your supplier will likely charge you a sample fee as well as the cost of air shipping that product to you (which can be anywhere from $50+)

Minimum Order Quantities (MOQ) When Importing from China

When you're placing an order, almost every supplier will have aMinimum Order QuantityorMOQ.An MOQ is just the minimum amount of a product you need to order from that supplier. Normally it's around $2500 to $5000 worth of product, sometimes lower. This is one thing you can really negotiate with your supplier on, especially on your first order.

Even if you think you're going to sell a billion dollars worth of product in the first week, I suggest making your first order size as low as possible.You want to gradually build up the order size with your supplier over the course of two or three orders.

When you place your order, submit an actual Purchase Order (aka an invoice) that consists of the following things:

• Order quantity
• Price
• Shipping terms, i.e FOB, CFR, EXW (More on this later)
• Date the order will be completed

You can just send a plain email telling your supplier you want to buy 100 widgets but it doesn't look very professional. I've made your life easy and provided a free sample purchase order (Excel) you can download here.

How to Negotiate Rock Bottom Prices and Low MOQs

The first thing you must do before trying to negotiate any pricing is toget multiple quotes, ideally from three or more suppliers.This will tell you what thenormal cost of your desired products is.

Order several samples and try selling them on Amazon before committing to a larger order.

In China, there is a golden rule: quality is directly related to price. Exceptionally low priced items normally mean exceptionally low quality. Another reason for a low price can be:

• The quality is significantly lower than others
• Different shipping terms (i.e. EXW instead of FOB)
• Significantly higher minimum order quantity (MOQ)

Once you determine what a normal cost is for your items you can try to negotiate pricing.However, prices in China are becoming more and more fixed and negotiation is becoming more difficult. A 5-10% discount off of quoted prices can often be significant.

Where you can negotiate is minimum order quantities (MOQ). Like I mentioned, often you can negotiate the suppliers quoted MOQ down by 50% or more.

In the future, when you start to place larger and larger orders, you can start to negotiate more on price. In the beginning though, you don't have a lot of leverage.

Payment Terms and Making Payments

When you are arranging payment terms with your supplier, the most common terms you will come across will be 30/70. That means you pay 30% when the order is placed and 70% upon completion. Never accept an order requiring a 100% deposit unless the order is small (less than $2000).

If your order is relatively small, under $2000 or so, your supplier will normally accept payment via Alibaba's payment solution called Aliababa Trade Assurance. This payment method gives you pretty good assurance your supplier will actually ship your products – it won't protect you much onquality issues though.

Once you get to larger orders ($2000+) payment is almost always made by wire transfer or sometimes referred to as TT (telegraphic transfer). Payment by credit card or PayPal is generally not accepted for orders larger than $5000 or so.

Payment is almost always in US dollars.

How to Ensure You Receive High-Quality Products

Your biggest concerns when importing from China will be to ensure that you're getting quality products.

Related Listening: E174: Avoid Getting Scammed When Importing Products From China

Quality standards are the biggest difference between Chinese manufacturing and Western manufacturing. Western countries (such as Amazon buyers) have much higher quality standards than in China.

The first shipment of products you receive will probably be some of the best quality products that that factory produces. Over time the quality canfade if you're not careful. Your supplier will start to substitute materials for inferior materials. This is why you want to specify in your Purchase Order the core components of your product as much as possible. For example, if you're selling t-shirts you want to specify exactly what type of fabric should be used. If you're selling a cutlery set, specify exactly what type of stainless steel should be used. Here are some other examples of materials you want to specify:

• Fabric type and weight
• Button type
• Critical Dimensions

As long as you tell your supplierexactly what type of materials they should use in your product, they normally won't substitute them. If youdon't tell them, they'll assume it's not important to you and substitute materials at their own will.

Related reading: How to Avoid Crappy Quality Products when Importing from China

Inspect your Shipments: We have an in-depth guide on how to conduct a third-party inspection. A third-party inspection costs about $300 and a company like AsiaInspection will send a person out to your factory, for an entire day, to inspect your products. There's no reason not to do it.

Show your supplier that quality is important to you. Inform your supplier of every defect you receive on an order and ensure they fix it on the next order.

Shipping and Logistics

In my own personal experience and after helping other first-time importers, having your goods shipped to you and receiving them is one of the most stressful and most challenging aspects of importing.

Three Ways to Ship Your Products: Air Courier, Air Freight, and Sea Freight

There are three ways to ship your items from China: air courier, air freight, and sea freight.

Air courier is simple for most people to understand. UPS, FedEx, and DHL are air courier services. This is what they call adoor-to-door service. Your supplier ships your products and they arrive wherever you want them to arrive, i.e. your home or Amazon warehouse. The courier also has customs brokerage services, to help you pay your duty, so you don't need to worry about getting a customs broker.

Air Freight and Sea Freight differ vastly from air courier (FYI there is no such thing assea courier). These services are arranged through a freight forwarder and typically are quoted from China to some airport or sea port, i.e. to the sea port of Long Beach (near Los Angeles) or Los Angeles International Airport (LAX).

You will either have to arrange to have your goods picked up or ask your freight forwarder to arrange to have them shipped to your final destination (which will involve a significant surcharge). They will not provide customs brokerage (at least not for free).

Sea freight is always quoted by volume whereas air shipments are quoted by weight, but a good rule of thumb is that sea freight works out to less than $1 per kg.

Air freight and sea freight are quite a bit more complicated than air courier the first time around. They are alsomuchcheaper. Air freight is about half the cost of air courier and sea freight is about 10% the cost of air courier.

Two of the most popular shipping companies (called freight forwarders) for air freight and sea freight are Freightos.com and FlexPort.com. You can always just ask your supplier to arrange the shipping of your goods and to simply bill you for them.

Related EcomCrew Reading: All About International Freight and Step by Step Instructions

Shipment Terms

In international trade, there is something referred to as Incoterms. Popular incoterms include FOB and EXW.

With FOB shipping terms, your supplier will pay for all the costs (including overland transportation in China) to get your shipment to the port and export fees. With EXW, you will pay for all of this. There is no difference in complexity but EXW will always cost you more than FOB (normally $300-500+ more).

The easiest thing to do is to always ask your supplier to quote you FOB terms.

Related EcomCrew Reading: Why Shipment Terms Matter: EXW, FOB, CIF, etc.

Customs, Tariffs, and the Magic $800 De Minimis Value

In America, orders under $800 do not have any duties applied to them. This is called the de minimis value. Orders above this amount will be charged applicable duties.

For orders under $2500, you will not need what they call aformal entry to import the goods into the United States. This means your shipping company will clear customs for you but they may charge you a fee for this.

For orders above $2500, you will need to file a formal entry and get a customs broker. We recommend PCBUSA.com. Fees vary but normally are $100-300 depending on the order size.

Once your goods are shipped and have arrived in your country, they need to clear customs into your country. If you shipped via air courier (UPS, DHL, etc.) then the shipping company will do this for you and give you a bill for it. All other shipments need a customs broker.

Conclusion

China still remains the factory of the world despite increased costs and sometimes increased tensions with the West. And despite its reputation for poor quality products, the quality of most products from China is still fantastic. Competition amongst private label sellers, especially on Amazon, has increased significantly over the last several years, but there's still a huge opportunity to develop a brand and real business around importing from China.

Do you have any questions about sourcing products, importing, or shipping your products? Feel free to comment below.