Amazon sellers looking to establish a profitable business should consider China as an attractive market. Once known as the ‘world factory,’ China is now capable of producing high quality and high value products. It is essential to develop a solid China sourcing strategy before beginning the search journey for the best Chinese suppliers. As a result, it will be easier for you to avoid scams, find a reliable supplier, and negotiate a fair price.

China and most other eastern countries do business differently than the West. In China, business is conducted through ‘Guanxi’.

Pronounced as ‘gwon-she,’ Guanxi means “connections” or “networks” that facilitate deals and open doors to business transactions. A person with plenty of guanxi is in a better position to grow their business than a person without it. The Chinese term comes from Confucianism with the underlying philosophy that all transactions, personal or business, should be conducted according to hierarchies and filial piety (‘xiao’).  Also in business transactions, it’s about building respect and trust with the supplier by establishing a relationship on a personal level. If you can build a rapport with the Chinese supplier, you’ll be able to close the deal. Stronger your foundation, the better your chances of a long-term successful business relationship.

Amazon sellers who are just starting out have a hard time sourcing from China. Finding the right supplier who is reliable and can meet your quality specs will take some time, effort, and thought. Here are some of the most common platforms for finding Chinese suppliers:

The sheer size of Alibaba makes it a good place to start your search. Many call it the Chinese Amazon because of its size. In 2019, Alibaba had 960 million active customers and close to 1.3 billion businesses. To start searching for suppliers, you need an Alibaba account. Next, go to “Sourcing Solutions” and fill out the relevant details to submit your request for quotations. Here are some details:

• Keywords for products – Include a few keywords related to your product that might catch the attention of suppliers. The more generic terms you use, the more likely you are to get sellers’ attention. However, if you have a niche and complex product, using specific keywords will help you get the attention of manufacturers.
• Detailed product description – Make sure you include the measurements, dimensions, materials, logo and other customizations you want.
• Quantity- After the product, China suppliers look at the order size. The more you order, the lower the price per unit is likely to be. Suppliers may not be interested if the order quantity is low.
• Photos –  Make sure you have good quality pictures of the product you’re looking for. Try taking a few close-ups from different angles to let suppliers know what you’re looking for.

The other way to find suppliers on Alibaba is to actively search for them. Enter the product name in the search bar and Alibaba will come up with dozens of results. The results may not all match what you want, and you have to spend some time finding the ones that do.

Before messaging the supplier, make sure it’s a manufacturer, not a reseller. Indeed, there are many resellers posing as manufacturers, so it’s difficult to tell them apart. Although Alibaba is the world’s largest marketplace, you can easily get scammed. For first-time Amazon resellers, finding legitimate suppliers can be challenging. Therefore, follow these tips to find a legit supplier on Alibaba:

• Find a Gold Supplier – Suppliers who have been vetted by Alibaba and passed scrutiny get the Gold Supplier tag. If you also see that the supplier has Trade Assurance, Alibaba acts as an escrow service for the transaction.
• Find out about the product line – If the supplier offers hundreds of different products, you’re dealing with a reseller or trader. There are only a few related products made by a manufacturer.
• Ask for documents. Ask for certifications and documents, like ISO 9001. Moroever, make sure the supplier can show you business registration certificates. Lastly, make sure the info you get from the supplier matches the business certificate.
• Personalization- Since a manufacturer has direct access to machines, they can customize your product.
• Tell the supplier you plan to visit – You can visit a legitimate supplier. When a supplier excuses and discourages you, that’s a red flag.

You can also use Global Sources. Since each supplier passes through a much more rigorous pre-qualification process, it has better quality than Alibaba. China Sourcing Reports provide an in-depth look at different industries on this site.

This is the biggest trade fair in China and covers every physical product industry. There are three phases to the trade fair:

• Phase 1 is where you can find building materials, chemical products, machinery and electronics
• Phase 2 is about home decor, gifts and consumer goods
• Phase 3 deals with office supplies, textiles, health and premium skincare products, shoes and medical products

It’s free to get an idea of the quality by looking at the samples suppliers bring. However, the sales representatives aren’t fluent in English so you might have trouble explaining your requirements and technical specs to the supplier. Although the Canton Fair is huge, the same suppliers come every year. You can find out where the booth of the exhibitors you’re interested in is on the fair’s website in advance.

Yiwu Market is primarily for resellers and trading companies, not manufacturers. Located in Zhejiang, Yiwu market has forty thousand shops and is open all year.

This marketplace may be a good option if you’re looking for low prices on shoes, watches, accessories, and bags. They’re mostly for buyers in Africa and India, so the quality and safety standards aren’t as high as in the U.S. and Europe.

When it comes to sourcing products for your Amazon reselling business from China, negotiating is key. A negotiation is not limited to the price, but also involves negotiating the terms and the type of business relationship. Everything else can be negotiated except local and federal laws.

When negotiating price, remember that the supplier will have a price threshold they won’t go below. Consider working out other details rather than getting stuck in price negotiations. If you increase the order size, see if the supplier can offer a lower price. Payment in advance may also get you a discount. When you place multiple orders, ask if you can get a lower price. If you evaluate the other areas of negotiation instead of just the price point, you can probably get a better deal. Another reason to not focus too much on price is that there can be negative consequences elsewhere, like the supplier may use cheap materials or poor packaging.

Make sure you know the market price before negotiating with a supplier. Usually, when you compile a list of suppliers, you’ll know the prevailing rate. Even if you’ve found a good supplier, talk to other factories. If one factory gives you a quote, you can use that to negotiate with the other.

The most important thing about sourcing from China as an Amazon reseller is knowing how to avoid scams. Here’s how to avoid fraudsters:

• Google the supplier- Most good and legitimate companies have a website. Make sure there aren’t any warnings about them online.
• Beware of very low prices- Low prices from a supplier are a red flag. If the quote is much cheaper than all other quotes in the market and exactly matches what you want, you should be suspicious.
• Check the supplier’s email address – Check the supplier’s email addresses to see if they’re legit. In China, QQ email addresses are just as reliable as gmail or yahoo.com. Make sure the supplier has an email with the company name.
• Ask detailed questions- If you’re dealing with a reliable manufacturer, they’ll answer all your questions about the process, quality standards, and timelines.
• Look at pictures- Authentic suppliers usually have detailed pictures of their factories and products if you ask. Also, they should be able to give you the pictures quickly while also meeting your requests for specific product details.
• Get a sample- Samples should be available from any legitimate supplier.
• Evaluate the selling history- Ask the supplier who they’ve sold the particular product to and get a reference from one of them.
• Request a factory tour- If you can’t visit the factory personally, you can hire a China sourcing agent to do it for you.
• Beware of payment fraud- One of the most common frauds in the past few years is payment fraud. Before making a payment, verify the bank account details with the supplier.

Sourcing products from China for your Amazon business is more than just searching for suppliers on Alibaba or other platforms. From unexpected price increases to shipment problems, communication barriers to poor product quality, there are lots of things that can go wrong.

As they have an office in China, the right China sourcing agent can inspect the production site. In Mandarin or the local dialect, the sourcing agents can make sure the supplier gets the product specs and technical details. If things go wrong in the last minute and the supplier can’t deliver, they can come up with a backup plan.

AROOM GLOBAL is an expert China sourcing agency that has helped customers manufacture and source products from the world’s factory. Contact us at info@aroomglobal.com or visit our website to learn more about China sourcing and manufacturing services.