Are you going to have a plan to do business with the Chinese?
Do you know exactly whom will you do business with?
Is the business’s corporate status OK?
How do you know you buy the same products shown in the pics?
How to keep your money safe and keep the business smooth?
You must have a lot more questions than the above ones. I think it’s very wise to ask as many questions as you can before you start your formal business.
As you all know, Chinese products are becoming more and more popular, therefore more and more merchants want to import a wide range of products from China. With full of passion and thoughts of being ready to make a lot of money for their pockets, lots of them start businesses hastily. Things are never as simple as you think. Of course, most people are relieved to do business with Chinese, and most Chinese people are friendly, enthusiastic, and willing to offer help, but unfortunately, there are still a small number of them who will do something wrong and bring you trouble. Anyway, it can be avoided if you do some work before you roll up your sleeves and work with added energy. Here are some tips that you should pay attention to, hope you can go further than what I suggest.
First of all, check the supplier’s background.
- Search the company name in Google, check whether there is any bad news or good news about them. Take a look at the forum, like Quora, from which you can browse lots of comments if this supplier has done some bad things to some customers. You can be sure it’s not your choice If there are a lot of complaints. Or you should feel excited if you find out some good news about them.
- Ask for a copy of their business licenses, then you get the basic information to see whether it’s a registered company. There is a very good Chinese website https://www.tianyancha.com/ to check every detail of a company’s present status if you put in the supplier’s Chinese company name. Although it’s Chinese, I think it’s not hard for you to find someone who can read Chinese to help you, if you don’t have such a friend, it’s easy to find someone on Fiverr or Upwork to do this work for you after you pay some money. And you can ask them to offer a detailed report about this supplier.
- Check the supplier’s credit at https://www.creditchina.gov.cn/. The information will appear on this website if someone or some company has no credit. I think it’s a valued factor for your reference. Just type the Chinese name on the below box, and the result shows.
- Check whether this company has had a lawsuit recently, and what it is. It’s very important information too. If it’s a case related to international trade, you need to be highly vigilant. The Chinese website is http://zxgk.court.gov.cn/, type its Chinese name or part of it, and you can see the result if there is a case.
You’d better ask others do the points of 2,3,4 one-time jobs for you, then you will get apparent background information about this company. Yes, it seems a little complex, but definitely, you are worth it.
Second, take a very careful check on samples.
Lots of troublesome starts from the sample. Some samples may be made according to some pics if they are regular type, but lots of samples need to be negotiated very carefully with suppliers, if you have a few samples in hand, and have found the right supplier, it’s better to send them a real sample. Because there are lots of details, such as what Internal and external materials it uses, how the real internal structure is, how it works, etc. And the supplier can only get the right data by testing some functions. If you only talk about the samples by email, WhatsApp or WeChat, I will be very doubtful that you are talking about the same thing. Here is an example that I would like to show how the troublesome happens by the misunderstanding of samples.
Alex is from Australia, he wanted to start the business by buying air filter regulators in China. He only showed his supplier some pics, from different sides, but his client changed the design and materials slightly, it’s hard to say what is the difference only from the outside, and the supplier thought it’s the regular one, also showed his own product’s video for Alex’s comparing them. Alex was very happy that it was so easy to find the “same” pneumatic filter regulator. After Alex got the quotation, he was very satisfied with it, he thought this was the perfect supplier that he wanted, and he could sack up in this dealing. Then he made some advanced payments, and let the supplier start the production. After 20 days, he asked the supplier to send the first batch by air to meet his urgent need. Everything seemed to be OK when he received the goods, but the client found out the difference in internal materials. The suppliers replaced plastic with brass in the filter part(sure he didn’t know that the sample used brass in advance, it’s not his fault), and used iron as zinc in the top part, which would shorten the service life and may cause other trouble. Also, there is one very small hole on the side of the sample that helps air go out but the newly bought one didn’t have such a hole, which can cause damage to the machine. Alex told the supplier the fact, but the supplier said they could use the materials Alex asked for, and for the hole, they needed to buy a new mold to make it, so they need to raise the price a lot, which meant Alex almost have no profit or even lose money in this project. Alex didn’t agree with the price increase so much, he asked the supplier to return the money, sure the supplier didn’t agree. After that, the supplier didn’t reply to Alex’s email or phone, and also didn’t send the goods.
Last, Alex had to pay a lot of money to find a Dispute resolution company, that tried to solve this problem, but it’s very hard to keep the original “wonderful feeling” that Alex used to think of it. In fact, lots of such troubles can be avoided if you asked a sample first and tested it carefully, also it’s necessary to take it apart and check every internal part carefully. Believe me, It’s worth the time and additional money.
Third, the Terms of payment
Whether you will make payment according to formal invoice or contract, write down all the important terms and details clearly, including the product detail, quality detail, delivery time, the package, the solution if they can’t send goods on time, the payment term, how to ship the goods, after-service terms and etc. The more details it is, the less trouble there will be. At the bottom of the file, ask for the official seal of your supplier and the signature of the person you are contacting, it’s better for the legal person of this company, and keep the scanned file. This invoice or contract is important evidence for litigation in the future when something goes wrong.
After doing all these steps, you can answer all the questions you asked above, your business can be moved forward normally, and less trouble will occur.