Subtitles section Play video Print subtitles Hey guys, in this video, I'm going to be giving you my five things that you should do before working with a Chinese supplier. Whether you're in the Amazon FBA game and you're getting your supplies from Alibaba. Or, you were in the Drop Shipping game and you are working with Ali Express Supplies. This video is for you. If you don't do these five things, you can loose a lot of money. You can loose a lot of money because of the fact, that you've chosen a supplier who is overpriced. And you're paying more for your items than you should. Or you could loose money from purchasing poorly manufactured items, that make customer's ask for a refund. And, you can even loose money from being sued. So, if you want to choose the right supplier so that, none of this happens to you. Keep watching this video. Tip One, check to see if your Chinese supplier has been to a trade show. Not all suppliers will have been to trade shows, and that's absolutely okay. In fact, most suppliers probably haven't been to one. But if you can find one that has, that is a big bonus. It indicates they are producing quality products. If their products were poorly produced, they'd be unlikely to bother showing them off at a trade show. And this of course, is very important because of the fact, that you want to be purchasing quality products that won't break. Because, if they break you're going to have unhappy customers. Plus, trade shows are also expensive to exhibit at. The fact that they have enough money to attend one, indicates their company is financially stable. And of course, this is important because, if you find a hot selling item that has just a single manufacturer, and that manufacturer goes out of business. Well then, you have no items to sell. Manufacturing items as cheaply as they are in China, means that those companies are working off of small margins. So if, they are not managed correctly, then they can risk going bankrupt. So, if you're trying to choose between which supplier to work with. If you see that one has been to a trade show, then that would be a legitimate factor for choosing them. So, how can you tell if your supplier has been to a trade show? Well, if you found them using Alibaba, it's quite simple. Just come to the Company Profile. If they have attended any trade shows, the trade show button will appear under additional information. Click on it to see which one's they exhibited at. For this company, we can see that they attended Hong Kong Trade Development Council in 2016, 2017 and 2018. Unfortunately, if you're using Ali Express, a lot of the time their original manufacturers are not listing the items for sale on there themselves. Take this camera lens travel mug from a company that I think you pronounce it, "Ouoh", they themselves do not actually sell it on Ali Express since what they chose to do is, they work with wholesalers who then, list it for sale. What I would recommend that you do in cases like this, is that you check to see if the original manufacturer in this case, 'Ouoh' have been to trade shows themselves. To do that, find the brand of the item that you want to sell on Ali Express. Then go to Alibaba and do a search for that brand and see if they've got a listing for it on there. If they do, open it up and visit the company profile to see if they have been to a trade show. As you can see, "Ouoh" have been to the Spring Canton Fair, which is the biggest trade show in the world. With this knowledge in hand, we know that the original manufacturer for this mug has been in business for quite some time. So, we know that it's not just going to disappear. Now again, just because a supplier has not been to a trade show, doesn't mean that they're some sort of a scam. Going to trade shows is very expensive so making it a financially positive experience, where you make enough sales to offset the cost of attending, can be a challenge. So instead, use this information to help you choose if you are stuck between two competing suppliers. Tip Two, avoid pictures with models. Here is a quick tip, if you were using photos for your item listing, that are the same photos that the supplier has provided. Avoid using ones that have models in them. Why? Well because, there is a reasonable chance that the supplier has illegally stolen those photos from the actual model themselves, which is an infringement of copyright. A model herself, posted a comment on one of my videos, talking about how this has happened to her. As I've explained before on this channel, most Chinese suppliers don't mind breaking copyright laws because of the fact that, it's really easy to get away with that in China. But of course, it is not so easy to get with that in the west. Now usually, the original copyright holder doesn't immediately sue. But, they can do that, it is within their rights. They don't have to send a take down notice first. But, something that does happen regularly, is that the original copyright holder will contact say, Amazon if you're using their picture on there. And they will get them to take that listing down. Or, if you're doing Ali Express Drop Shipping and you are advertising your product on Facebook. They will contact Facebook and get that ad taken down, which is very bad for your ad account. Now not all photos that suppliers are using, that have models in them, are stolen. But because of the fact, that you just don't know, it's risky to use them. So what I recommend is that, if you want to use photos that have a model in them. Get a sample product for yourself. And then, you can take your own photos with it instead. Tip Three, check to see if you are working with a manufacturer, a trade company, or a wholesaler. When you're working with Chinese suppliers, you're going to run into three main types. You're going to find manufacturers, trade companies, and wholesalers. Now this may sound boring and jar gony, but it is really good to know what these terms means. A manufacturer is exactly that. They are the company that originally created the item in their factory. Working with them usually means that you get the lowest price. A trade company is a middle man, who is working as an agent between you and a manufacturer. As a result, they often do have higher prices because of the fact that, they need to make a profit themselves. Now, you may think that you should just avoid trade companies all together. But that's not necessarily true. Sometimes, it is better to be working with a trade company rather than, the original manufacturer. And sometimes, due to the improved communication you can actually, negotiate lower prices than if you had gone directly to the manufacturer. And finally, a wholesaler is another form of a "middle man". What they will do is, they will purchase items in bulk and then, they will send them out to you and I. On Alibaba, you're usually going to be running into either, manufacturers or trade companies. You can find out if the company is a manufacturer or a trade company by going to their company profile. Under Business Type, it will tell you if a company is a manufacturer, trade company, or as in this case here, both. Yes. This company is both a manufacturer and a trade company. What that means is, they do manufacture their own products. But, they act as a middle man for some other types of products that they don't produce as well. For example, the main item that they manufacture in their factories is this camera lens travel mug. You can tell because, on their Alibaba item listing for it, the brand is listed as the factory's, "Ouoh" brand. Whereas, this pretty cool coffee cup holder does not have their brand and so, most likely, they are selling it as a trade company. Now on Ali Express, you will often find either, manufacturers or wholesalers. And a really good way to figure out if a company is most likely either, a manufacturer or wholesaler, is to see if they are selling more than one type of brand. For example, this store here Transhome, which has been featured on our channel numerous times before. Is clearly the original manufacturing store. Not only is it named 'Transhome Official Store' but they only sell Transhome branded items in it. On the other hand, this store here, Mr And Mrs Store, is clearly a wholesaler. As they have a non-branded store name and they stock items made by multiple brands. For example, they are selling several kitchen items manufactured by 'Ouoh'. And they're selling multiple dog related items manufactured by 'Doglemi'. And they are selling several different lighters produced by 'LCFun'. And again, neither is better than the other. Oftentimes, manufacturer's will have the lowest prices. But on the other hand, wholesalers will often have a wide selection of items. There are pros and cons. Tip Four, recapping agreements is crucial. Now there are several advantages for working with Chinese suppliers. One of them being, their incredible low prices. And when I tell people about what I do, I get a lot of comments from people that say things like. "Oh! The Chinese, they just produce cheap, trashy items." And that is just not true. And I personally think that, that's a really unfair stereotype. I mean, yes you will find factories in China that produce low quality items but, the same goes for the west. I have a friend who is an incredible artist and she was going to a comic convention and she had a booth. She wanted to produce a bunch of pens so that, she could sell them to her fans. For the longest time, she had been working with a factory in England. And the pens that she was producing were not very high quality and they were extremely expensive. And so, I asked her. "Have you looked into using a factory in China?" And she said, that she had. And that, if she used them she'd be paying a fraction of the price. But, she was afraid too, because she did not trust the quality of the pens that they would produce. With a bit of encouragement from me, she did try the factory in China, and guess what? Not only did she save hundreds of dollars, but the pens that they produced were higher in quality. So, 'no' "local manufacturers" aren't just better because they "aren't Chinese". But, there is one big advantage to working with local manufacturers and suppliers. And that is the language barrier. So, when you're working with Chinese suppliers, I recommend that you ask very specific questions. For example, let's say that you're private labeling on Amazon and you want to purchase a bulk load of items from your Chinese supplier. But you want to know what you're shipping costs will be. Ask very specific questions. Never assume that they will figure out to give you this information on their own. Ask them things like. "What are the dimensions of each carton? How much do they weigh? How many units fit inside a box?" If you don't ask specific questions and instead, ask something like. "What are the dimensions and the weight of each box? I want to figure out what the shipping cost per item" ... Almost always they are going to answer with a literal answer. They'll tell you the weight of the box. They'll tell you the dimensions of it, but they won't think to tell you how many units fit inside each one. Even though, you need that information to figure it out. A lot of suppliers will not think to give it to you because, of the language barrier. So, whether you are negotiating an agreement with a supplier that you found on Alibaba, or a Drop Shipper that you found on Ali Express. Get them to recap each specific part of your agreement in writing. So that, you can make sure that everyone has the exact same expectations. Tip Five, prioritize products that have multiple manufacturers. Perhaps, you want to manufacture and private label your first item for Amazon and you've found two items that both look excellent. Or maybe, you're Drop Shipping an item from Ali Express, and you've found two items that you would like to run a Facebook ad for, and you're trying to decide between the two of them because, you're on a limited budget. My advice here would be to see, which item has multiple, reliable suppliers and to prioritize that item. Why? Because, as I mentioned earlier in this video, Chinese suppliers and manufacturers, are often working off of small margins. That means that if they are financially mismanaged, then there is a very good chance that they will go out of business. And if they go out of business then, you're kind of going out of business too. In China, manufacturers copy each other all the time because, there's basically no legal repercussions for this. This is a great example of that. On Alibaba, you can see that there are multiple manufacturers that are producing their own version of a camera lens travel mug. That means that if you were private labeling this item for Amazon. If your main manufacturer went out business, you know that you could find another one. And on Ali Express, we can see that there are multiple sellers that are selling their own brand of it, as well. This means then, that if you were Drop Shipping this item in your own Shopify store, and then your main supplier went away. You know that you could find another one, so that you could keep selling this mug and keep making money. So, I hope you guys learnt something from this video. If you did, then I know that you would love our other videos that are about selling online. So be sure to subscribe to Wholesale Tiered and click that little notification bell next to the subscribe button, so that you don't miss out on any of our videos. 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