I have traveled to some countries around the globe, without a doubt China and India offer an excellent opportunity for start-up business start-ups. BUT, those that travel to Asia without having done any serious homework on business ideology and cultural relationships will find themselves at a great disadvantage. To be successful, you need to ‘re-learn’ almost everything you thought you knew about business.
The saying “When in Rome, do because the Romans” is quite true in Asia. The only real advantage you have is the fact that there are many sellers today than buyers. This gives you some room to negotiate price, but little or no on terms. The few ‘bad apples’ present in both clients, has built up a degree of distrust on both sides.
Entering the Asian market without a minimum of some experienced people behind you does place you at a and the higher chances of failure or anyway, lowering your profit substantially.
Seek aid from a professional foreign business whenever possible.
Relying on media to offer an obvious insight into the issues you will face during Asia, will not be as useful as being a visit directly. There are many successes on the market, but you can even find stories of failure.
Most are a result of poor planning and a lack of understanding in regards to the people you’re planning to work with.
So think carefully, talk to people that have been both successful and those that failed, and seek help while you’re there.
Think Twice Before Jumping Into International Business
For every story of success, you can find a thousand stories of failure. This article is not intended to deter anyone from attempting to enter the foreign trade market, but rather to provide a much better insight as to what you need to expect.
From the outside (and to many inside), foreign trade is just obtaining a product for a surprisingly low cost and marking it up a bit finding a buyer. Sounds simple. This is why a lot of checks it out.
Finding an item at a really low price is easy. Finding a reputable supplier is very time-intensive and is normally a matter of learning from mistakes. Quality is an additional issue you must be concerned with. Regulations concerning imports and exports are an area which you have to become familiar with. Finding customers may not be as elementary as you imagine.
Let’s look closely at each area – Let’s use Costume Jewelry as our target product-
1) “Finding a product at very low costs is easy.” Simple, search keywords including ‘costume jewelry suppliers’ Look what Google search found –
– Results 1 – 10 around 2,300,000 for costume jewelry suppliers.
Look what Yahoo search found –
– 29,700,141 results for costume jewelry suppliers.
Ok, we found the price we like.
2) “Finding a genuine supplier is very frustrating and is also commonly a few trial and error. ” Do you realize over fifty percent with the listing which tells you he is “manufacturers” are in reality really small trading offices use up people’s homes? Did you inflict criminal record checks for the supplier? Did you call them and speak to a person? How is it requiring payment?
3) ” Quality is an additional issue you need to be concerned with.” – Not long ago, a properly know retailer recalled huge amounts of money in costume jewelry. Was it the fault of the supplier (manufacturer) or the buyer (famous retailer)? ANSWER- BUYER! In this case, the customer had the resources to ensure the quality of the product leaving the factory was safe but decided to look one other way. The safe product might have been more pricey thus reducing corporate profits. So it was not a concern until a third party managed to get public.
4) “Regulations concerning imports and exports can be an area which you must know more about.” Here is where so many end up in trouble. You pay a factory $50,000.00 to ship 20,000 electric bikes for the USA. EASY! Contract signed, payment made. Product shipped. The factory has filled its legal obligations. Problem was, the agreement would not state what certificates were required. You choose the merchandise and said ship it. They did. Now customs have 20,000 electric bikes that they’re not releasing as a result of insufficient documents that you simply may or might not exactly ever receive.
Keep planned, you ARE the buyer from your factory. It is your responsibility for setting high-quality standards and turn into willing to pay for that extra measure of quality. Sadly, some huge corporations today put public safety behind profits. The factory will sell you a product very very cheap, but this may force the crooks to use super cheap materials.
As I have been within this business for over two decades, I will do not have the minimum price, but quality issues causing a safety concern hasn’t happened to us. Don’t allow profits to become the master, your reputation, as well as the safety of one’s customers, should always come first.