Business with China is one of the most profitable today. Buying at a low price and reselling the item at a higher value is a good source of income.
If you decide to start a business in China, then the question of how to find an intermediary for purchases in China should come first. The quality of delivery, timeliness, and appearance of the goods depends on the intermediary.
Benefits of working with a qualified Chinese intermediary
Let’s consider what benefits we have when working with an intermediary
- Good market knowledge of local manufacturers;
- The favorable price is due to large discounts from Chinese manufacturers;
- Small orders can be managed;
- There is an export license by default, they are well aware of the entire document flow;
- Awareness of new products. Help you to get what you need;
- They work professionally, respond quickly;
- Often take over the printing of packaging, ensuring consistent quality;
- Control product quality;
- The ability to optimize logistics.
How to find a procurement intermediary in China
Enter “China reseller needed” in the search box. Google will provide lists of companies that supply from China. The selection will have to be done manually.
Immediately discard the top 4-5 positions marked “advertising” and sequentially go through the lists of the rest. Repeat your search on the next 2-to 3 pages. Not all good intermediaries make it to the top 10.
How to recognize a suitable intermediary and check the reliability
It doesn’t have to be a big company with a big name, but there are several signs you can use to find the right intermediaries:
Own representative office in China
The intermediary must have an office in one or several major cities in China, a staff of well-trained specialists, and business connections throughout the country. The addresses of offices and contacts for communication the intermediary indicates on his website. If there is no contact information, or, for example, only e-mail is indicated, this is a reason to be wary and doubt the reliability of the information.
Certificate of the participant in foreign economic activity
Search or request a certificate issued by the Ministry of Commerce of the People’s Republic of China (MOFCOM) confirming the company’s right to import and export activities.
- Employees of the Chinese branch who are fluent in English and Chinese
Registered office in your city or country
Employees will take care of the cargo after crossing the border. The more services the company provides independently (transportation, declaration, warehouse storage), the less often overlaps occur due to the inconsistency of the actions of the performers. Moreover, the premiums to the shipping cost are lower. Plus, it is easier for representatives of the same mentality to find a common language when discussing the terms of cooperation.
How to choose an intermediary for the price and quality of services
- Do not consider price as the only criterion for selecting a commercial agent. Intermediaries are primarily businessmen. It is not profitable for them to work for free or cheaper than the cost price. Gathering information takes a lot of time. Searching for direct manufacturers, checking sellers, and negotiating prices in China most often requires the personal presence of the agent’s employees. Although for regular customers with a large volume of orders, flexible rates are provided.
- On average, for the purchase of a small batch of goods from a Chinese supplier, intermediaries take 7-10% of the delivery cost. If you place an order over $ 2000, the intermediary rate will drop to 5%. For orders over $ 2,500, the commission will almost certainly drop to 3%.
- Rates that are too low can be a commercial gimmick aimed at the inexperienced entrepreneur. In this case, the intermediary compensates for the low commission with additional surcharges and high transportation costs.
In order not to be mistaken when choosing a partner, rely on reliability and reputation:
- Chat with representatives of your local and Chinese branches, and ask questions that interest you, for example, about delivery times, the cost of services for preparing a contract, or purchasing goods from a reseller’s trading company.
- Look for real feedback from people about working with this intermediary. Such information can be found on the Internet, in various blogs and forums. It will help you draw the right conclusions about the reliability of this intermediary.
- Read the terms of cooperation, and the list of services (spelled out in the Contract, the Agreement, and annexes to them). Legally operating companies provide official information without any questions, and answer questions about the timing, guarantees, terms of payment, and cost.
- Order a trial delivery – for example, samples of goods from a manufacturer you found yourself on the Internet.