Go to TOP

Import from China Mini-Course - Part 5 - Section 1

"Importing From China For Ecommerce Profits"

Importing from China and the Far East is of course not a new business idea. In fact, Westerners have been making fortunes trading with China for centuries, dating back to the ancient Silk Road and medieval spice trade.

In the past twenty years, China has emerged as the world's dominant manufacturing base for an ever-increasing range of products, and this now includes high tech consumer electronics products such as mobile phones, computers, and TV / home entertainment systems. For international business people in a position to use their know-how and contacts to buy from China and sell in their home markets, the profit opportunities are massive.

International consumers are hungry to snap up cheaper and ultra-cheap imported goods, and China's enormous low-wage workforce, accompanied by more and more relaxed business regulations, mean that the cheapest mass produced goods come from China and "Made In China" will continue to be the most common label on most consumer goods for years to come.

You don't have to be a big, established company, or an import expert to begin taking advantage of buying low in China and selling high at home.

Where can you look at examples of the smaller businesses that are already taking advantage of the low cost of Chinese electronics and other products?

Well, in case you hadn't noticed, most of your local mall / high street stores are stocked with goods from China - it's not just Wal-Mart doing it. And I expect if you're a reader in a Western country you're already heavily into online shopping, and guess where most of those products come from...

Here are the biggest hubs of small-business online sellers for you to research, because so many of them are already using the China-cheap-import model to make big bucks, and you can learn a lot by seeing how their businesses are operating:

  • EBay Power Sellers.
    http://pages.ebay.com/services/buyandsell/welcome.html

  • EBay Stores
    http://stores.ebay.com/

  • Yahoo Stores
    http://shopping.yahoo.com/

  • Amazon Auctions
    http://auctions.amazon.com/

  • Amazon zShops
    http://zshops.amazon.com/

  • ...and if you haven't already tried Froogle - you can search here inside the product catalogues of a gazillion other online shops, big and small, mainstream and niche:
    http://www.google.com/products

 

If you take a look at these sellers' products many, many of them are sourcing from China, and a lot of them probably drop-ship products directly from China, meaning they don't even handle inventory.

You'd better believe that you can follow the same model for great import profits!

 

What Is "Drop-Shipping" All About?

Drop-shipping (also spelled as one word "dropshipping") is a practice of selling someone a product that you don't actually have in your hand.

Sound like a scam? Think again, it's the new face of marketing and distribution in today's information-driven market.

Here is what you do if you are a drop-ship seller:

  1. You research good products to sell. You do the research to locate a good supplier of these products and establish a buyer relationship.

  2. Next you advertise their products to your market, e.g. to your shop's customers, to your online auction viewers, in a magazine, etc just as you would market your own product.

  3. You receive and process orders for the products from the customers, and take their payment.

  4. You use this payment to go to the supplier of the products and buy the goods you need from them.

  5. The supplier sends the goods directly to the customer without you having to handle the products or any stock.

  6. For an extra fee many drop-ship suppliers will also brand the packaging and invoices with your name/logo so it looks to the end customer like the goods have been dispatched from the same exact company that they ordered from.

 

Drop-shipping is a classic exploitation of ecommerce online, because customers don't expect to see the goods when they order. If you walk into a normal shop and the shopkeeper asks you to put down money for goods which aren't even there, and will be delivered to you later from another shop which quite possibly you could buy from directly, would you still make the purchase? I don't think so, but it's different in 'cyberspace'.

Online, the source of the goods is not quite so clear, so buyers are happily going to send you money for products which in fact you need to source from somewhere else.

The obvious advantage of drop-ship selling is that you can make profits selling any sorts of easily deliverable goods, without having to take the risk of investing in stock, and without the costs and hassles associated with packing and delivering goods. Your selling business could also be very scalable, going from a few orders to a few hundred without significantly increasing your workload or operating costs.

Drop-shipping can also be a source of efficiency for distributors or wholesalers because drop-ship sellers do much of the marketing work for their products which the larger companies wouldn't spare the investment, time, or expertise to do in so many worldwide markets. Because the drop-ship seller frequently will handle much of the customer service and also consolidate several small orders into reasonable larger order quantities, the large distributors will see small drop-ship sellers as good business partners.

However, there is more complexity to drop-shipping than meets the eye, and since it's so easy to start up a drop-shipping business you need to be aware of some of the risks and downsides before you plunge in.

 

Is Drop-Shipping For You?

Drop-ship selling can be a great way to make good profits from a small and fast start-up business idea.

It can also potentially bring good value to your customers, because although you are marking up the cost of the goods for your 'middle-man' profit, you may be bringing your market products which they otherwise can't obtain or didn't know about. You could also be adding value to the buyer's experience by creating good product combinations, making ordering easier and more secure, improving product information and customer support, and assisting with import issues.

BUT, drop-shipping is not a simple thing to succeed at. Many people are succeeding at it, but you need to have a reasonable business common sense and be aware of the potential difficulties you will face.

Let's say you find a really good, desirable product and you have a good supplier for that product who will drop-ship to your customers. Let's also say you have the know-how to market this product to the right customers. You've got the makings of success already! But you are not home and dry. Actually now you need to think ahead about how your business is going to work...

Read on for Rose's special negative thoughts about drop-shipping!!

continue

Shop By Category 