How to import goods using Alibaba

With the likes of Alibaba you can now deal direct with manufacturers in China and beyond. It's an exciting prospect, but how do you begin?

by Alexander Garrett
Last Updated: 29 Oct 2014

Is it legal? Make sure the goods you want aren't banned or restricted, for example, endangered animals or rough diamonds, or 'counterfeit, pirated and patent-infringing goods'. There are restrictions on foods and vegetable products too - check on the HMRC website.

Get browsing. There are numerous sites for sourcing products from overseas: Alibaba, Tradekey, DHGate and Taobao are just a few. If you have a bespoke need, put out a 'request for bids'. But be warned: Chris Walworth of surfboard company Sea Rebel did just that. 'Pretty much everyone in China decided they would bid and within a week I had 1,000 responses,' he says.

Choose carefully. There are millions of suppliers in China but not all are what they seem. Wei Duan, a director at Europe, says you should establish whether you are dealing with a manufacturer, agency or middleman. 'At the end of the day, it's the factory that has final say on what it is able to produce,' she explains. 'You'll also pay more if you buy from a middleman.'

Do the due diligence. Don't choose suppliers just on price and be wary of scammers. Look for past history, years in business, good and bad reviews. Phone suppliers to ensure they are who they say they are, and check if there are complaints about them. Choose 'Gold Suppliers' or similar, which have been independently verified.

Feel the quality. Ask for samples first and consider using an inspection company. 'Inspections can take place during manufacture, at the time of packing or at the dock to be sure that the right goods will be loaded up,' advises discussion board The Wholesale Forums.

Know your terms. Gen up on incoterms - or international commercial terms. There are 11 rules, defining who deals with issues such as customs declarations, paying for transport, unloading and insurance.

Money matters. 'Think about exchange rates: they can fluctuate hourly,' says Ashley Payne, managing director of electronics supplier Stock Sourcing. 'Bank transfer is the easiest way to interact,' he adds. With escrow, funds aren't released until you have received your goods.

Pay your dues. Duty and VAT may be levied. To find out the customs duty, look up the 'commodity code' for your goods - a document called The Tariff is your bible.

Do say: 'Please supply me with your preferred terms and conditions, as well as customer references.'

Don't say: 'I'll have 10,000. Where do I pay?'

Alexander Garrett

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