Ask HN: Real-world experience importing from China?
Is anyone familiar with the site alibaba.com? "Global Trade starts here" they say. As far as I know, alibaba is basically a hub for overseas manufacturers to contact overseas buyers....you buy products in minimum lots of 100, etc.
It seems logical to have one central source for overseas manufacturers to market their products to buyers, but to someone in the real know, are sites like alibaba just for suckers? Are you way overpaying for products vs dealing more directly with someone closer to the manufacturer?
Anyoine have any experience in this sort of thing?
13 comments
[ 3.4 ms ] story [ 44.7 ms ] threadIt's not Alibaba that's spamming you, it's the vendors themselves.
If you're in the U.S. take a trip to any commerce fair for your industry. Before I got into electronics I was doing lighting and green building products; I called one of the Chinese companies attending the New York Lighting Fair and told them I wanted to come to their booth. Next day I drove to Manhattan, walked to the reception area and told the lady there I was a limousine driver here to take my Chinese company out for lunch. She printed a $100 badge out for me for free and I went to Eddy, my friend, we shook hands talked for hours and he invited me to his factory and his home in Shanghai. I did the same thing several times in different trade fairs and by the time I went to China I had organized orders from Arab and American companies for their products and we're good friends and brothers to this day.
For Chinese companies, it's best to call your sales person up and become friends. But don't sit on your ass and chit chat all day long, they want salespeople, get up and make calls on their behalf. I paid good money getting their product photos edited and printed on glossy materials. If you can organize enough buyers, the Chinese will let you tack your profit ON TOP of the cost of the products. Or you can get your clients to by X units and your factory will sell you X+N units, where N is your own free inventory to do with as you wish.
From: Alibaba Trade Alert <tradealert@service.alibaba.com>
Three exactly identical messages. To three totally different names...
Thanks to this unhealthy hoarding habit, I can produce product samples and quotes to buyers for stuff I don't even have.
I have seen some sites also publish their user growth in newsletters as well; it allows me to study their growth patterns.
Ditto with sales mail that's CC'ed to me. Instant mailing list of potential buyers, for free.
As far as a general answer to your question -- it depends, but Ali Baba is certainly not only for suckers. It's too big to be worthless.
You should only be buying original brands from their manufacturers, or generic commodity items. For example, you can get great prices on LCD screens on Alibaba, but you will get a fake Samsung LCD screen, unless you were buying from Samsung or a reseller.
People who get fake stuff from Alibaba willingly do so. Counterfeit is a huge business, and every minute a moron gets ripped off on EBay, so he decides to rip off others by importing counterfeit products with the intention to resell them. What he doesn't know is that he will be ripped off again, this time wholesale. It's for this reason that generic, white-label products are hard to come by in certain markets; it might even be cheaper, sometimes, to buy new cases for knockoff products and rebrand them yourself as Acme.
Yesterday my girlfriend bought me a electronic shaving kit from a reputable chain store and I remembered seeing that same product in China for $10; I was asked to export it. I have even seen Australian mobile phone company booths selling knockoff phones without realizing it.
http://news.ycombinator.com/item?id=762531
Alibaba is a hub, but it's a very Chinese company; I was there in Hong Kong during their IPO and I can assure you, HK and all of China was abuzz. Nearly every Chinese factory has an account with them. You should be safe dealing with .cn firm through Alibaba, specially if they have verified accounts. You can use that post of mine to look for scam clues, but generally, your order will arrive, albeit a little bit overpriced. If you want fair market you should be at the market, in person, taking long rides to dusty villages like the rest of us ;-)
The price hikes are usually done by resellers, middle-men and brokers. Not all "Chinese" are Chinese; there are plenty of Overseas Chinese (Honkies, Malaysians, Taiwanese, Singaporeans, Vietnamese, even Filipino Chinese, who do business in the mainland and act as brokers to foreign companies.)
Indians are pretty safe too. The guidelines for doing business with Indians is different than doing with Chinese, but not by much. Indians are usually less polished in appearance; the Chinese spend a lot of money on image, so they have bigger office buildings, fancier sales brochures and the like. In my experience, specially in generic drugs and pharmaceuticals, the most efficient Indian "companies" have been a few guys, usually cousins, usually Punjabis, who did business outside a shared office in Hong Kong or Dubai but they did a great job delivering the goods as promised. Indians also have trained practitioners as salesmen; my pharmaceuticals sales guy was an oncologist (In China he would have been an English major, for example.)
Usually the best way to conduct an important business is to fly there. Even if you budget is $10k; I would say spend half of that on travel expenses and your eyes will be opened to the many possibilities out there.
I also dabbled in scrap metal and used cars; those two are the FOREX of the import/export world, rife with scammers and sometimes violent criminals.
Avoid any business that offers you "government connections"; this is where you will likely be robbed. If a partner hints at having government links and tells you he has the ability to avoid customs or shipping expenses, this is their way of appealing to your greed. There are plenty of Westerners who are dying to be friends with a rich 3rd world dictator, it's like an undocumented fetish. Play ball, and play by the rules.
More than Alibaba, I would be weary of any firm that has the label "drop-shipper" anywhere on its site. Big manufacturers don't sell to EBay kiddies; that's just weak and disgusting.
The reason I specified the product industry and manufacturing region is that it's not just a matter of calling up factories and looking at their samples. It takes a lot of effort to create a relationship with the Chinese. If anybody tells you they can "get anything from China" they're blowing smoke; they can't, at least not efficiently and cheaply. Everyone is in an specialized industry, and whoever has a lead outside his expertise passes it on to someone in that industry. China is all favors, face, guanxi, and connections.
The concept of "face" is a lot like consumer rewards and frequent flier mileage; the more you buy from a factory the more perks you get and the more face you have with the management. At the high end, people with good contacts can get millions of dollars worth of products up front :-) reputation is currency. People who hop-industries, the jacks of all trades, don't get any deals and nobody knows them. (or worse, people do know them and they have a negative reputation.)