Importing from China – The Foolproof Formula for Success
Today we are introducing you to Fredrik Gronkvist, co-founder of AsiaImportal and a Neat customer. Fredrik runs ChinaImportal.com, an online platform where importers and small companies can manage every aspect of their import business. This platform covers everything from creating a spec sheet all the way to booking shipment, quality control, and so on. It helps with the business of importing, conducting business overseas and transfers. Fredrik will share his recommendations for entrepreneurs starting to import from China.
Fredrik’s Tips to Start Importing
Do you have any top tips for someone who wants to start importing products from China or someone who wants to enter this field?
1. Before you start anything, make sure you have a clear product specification sheet that your supplier will understand. It should list components, materials, different industrial standards and so on. This means you need to do your research. You need to have an understanding for different design options, different customisation options, and more. Not having a spec sheet is the number one cause of quality issues and misunderstandings. We provide tutorials and document templates that companies can use to go through the process step-by-step on their own.
2. Before you get started, make sure that you understand the regulations that apply to your product in your country because as an importer, you’re always responsible. You have to make sure that your product does not contain certain chemicals and heavy metals. You need to be aware of how transfers of this nature are handled. There may be other safety regulations and labelling requirements according to the regulations in your country.
3. When conducting transfers always get your products quality checked before delivery. That applies to the first order and every other order you will place thereafter.
Say someone wants to start an eCommerce store and they know a lot about marketing but not about product or design. Can they still go through the manufacturing process themselves or would they have to get external help?
This really depends on what kind of product it is. If it’s a T-shirt, it’s not necessarily that complicated and you could use a tool like Techpacker.com. You can even go on Upwork to find someone to create a basic pattern for you. It doesn’t have to be that complicated. As long as you can provide a drawing, your supplier can likely turn that into a technical drawing.
But if you’re looking to buy, say, electronics, then it gets more complicated. A supplier in Shenzhen will not just spend 50, 60 hours to redesign a product and new PCB schematic just because someone sent them an email. No one does that kind of work based on an idea. If you want to go into electronics or a technical product, you need to have engineering expertise yourself so you can actually provide these design drawings and PCB schematics or you will have to hire someone to do that for you. For generic consumer products, as long as you can provide a sketch that’s somewhat accurate, it’s a good start.
Quality Control and Safety Standard Compliance
How can businesses assure the quality of their product and the legitimacy of suppliers when importing from China?
It’s very hard to categorise suppliers into legit suppliers and suppliers that are not legit. You have to do a basic background check.
One thing that is important to look out for is whether the factory can produce products that are compliant with safety standards of where you live. For instance, if you’re based in the European Union and you want to import children’s products, you need to look for a supplier that can actually comply with EN 71. If it’s in the United States, it’s CPSIA. Most suppliers can’t comply with overseas product regulations. It’s only those that are very export focused that can actually comply with these strict requirements and make successful transfers.
How can you verify whether or not a factory can comply to safety standards?
There are many ways to do a background check but the easiest thing you can do is to just ask the supplier to provide a test report. You have to check if this test report is valid for that specific company, of course, and you have to verify that it’s authentic, which you can do by contacting the issuing company. In fact, many suppliers these days even upload test reports on Alibaba and Global Sources.
How does it work in terms of your platform? You provide the tutorials and you mentioned you also have a quality assurance and testing. Do you have partners that you refer your clients to?
Some of the services are provided by us. For example, we provide supply sourcing services meaning that you can go on our website and order a sourcing report. We then identify five, six suppliers partly based on our compliance checklist and our product safety checklist. For some other services, such as lab testing, we have partners and you can get a quotation on our platform.
The Quality Inspection Process
Can you tell us more about your quality inspection process? How does it work?
Before production is expected to be completed, you reach out to us and we help you create a checklist. Every inspection is based on a checklist. We decide what we should look for during the inspection. This could be dimensions or a visual inspection to check for damages and incorrect colours. We document the product and take close up photos to show the product from different angles to demonstrate to the customer that it’s actually matching the design drawings. Depending on the product, we could also do e.g. water pressure tests, drop tests, and scratch tests.
Once we have the checklist, we send an inspection agent to the factory. They execute the inspection, which roughly takes six to seven hours. The next day, the customer gets a 15-20 page PDF report showing all the data and photos we collected. It could show what the product looks like and the defects we have found.
You can go to IKEA and if you look close enough, you will see issues. It’s not a science, it’s not nature, it’s manufacturing. There are always issues. But hopefully, the defect rate is below 2%. In some cases, it’s higher than that, at 20-30%, and then the supplier has to redo the order. The quality inspection is a very cheap service, you’re looking at maybe 300 USD.
Fredrik’s Experience with Neat
How has your experience been like working with Neat and how has it helped you as a European entrepreneur who’s conducting business in China and making international transfers?
Neat is one of a kind. It’s a fantastic product and especially for me because I’ve been based in Shanghai for many years but recently we’ve been branching out and visiting suppliers also in Vietnam and other countries in Asia. It’s always been a huge issue for me in the past few years doing business and making transfers only having either the Mastercard in Sweden or using a UnionPay, which works in maybe 1 out of 5 ATMs.
With Neat, I can access my money anywhere in the world, be it in Shanghai, Hong Kong, Saigon, Bangkok, or some city in Jiangsu Province. Transfers and payments are easy now. It just works. This has been a major issue for me in the last few years. I could never get a Mastercard in Shanghai because they only use UnionPay. For someone that is living in this region and needs to go to all these different places in China and other countries, it’s a huge help.
Also, when it comes to the Neat Account, it’s fantastic that it just links up so well with PayPal and Stripe. We can’t get paid if we don’t integrate with PayPal and Stripe because we sell our service packages on the internet. For us, that’s an absolute killer feature.