12+1 business ideas on how to make money with China, the best ideas from China on hobiz.ru

LLC or individual entrepreneur?

Anyone can do business with foreign companies: both legal entities and individual entrepreneurs. When importing goods, you need to remember one thing: at customs, in addition to duties and fees, you will need to pay VAT, and this obligation applies to all importers, regardless of their taxation system.

This often becomes an unpleasant surprise for companies on the simplified and patent taxation systems, which usually do not pay VAT and, accordingly, cannot deduct the paid VAT. In this case, the product will become 20% more expensive for them.

The optimal taxation system for conducting international trade operations will be OSNO, where you can deduct VAT paid at customs; or the simplified tax system (income-expenses (15%), where it is possible to offset the paid VAT as expenses and thereby reduce the tax base).

Who can do business with China

Any individual can start a small business with China. Official registration as an individual entrepreneur or legal entity is required only in the case of large deliveries of one product. Many Chinese suppliers have special favorable terms of cooperation for buyers from Russia.

Before starting a business with China, it is not necessary to register a company. It will be more productive to invest resources in training the necessary skills in order to reach a new level easier and faster.

Where and how to look for a supplier?

A separate article can be devoted to the issue of finding a supplier in China. “Despite the fact that only Alibaba or Tao Bao come to mind, there are a huge number of specialized platforms focused not only on exports, but also on the domestic Chinese market,” explained our partners from Delasia.

When you independently search for a supplier via the Internet, you most likely will not incur any costs other than the delivery of product samples before placing the main order. However, already at this stage of work, it would be rational to attract a partner company specializing in working with China, which will not only help you choose the best option among the many offers, but will also be guaranteed to check the reliability of the selected supplier.

Each product requires an individual approach: depending on the volume of supplies, type of product and its cost, different options for finding a supplier are possible. Today, Chinese suppliers are widely represented both on the Internet and in exhibition format, as well as in showrooms.

China is characterized by a cluster organization of industrial production. Guangdong Province (Shenzhen, Guangzhou) is the main supplier of electronics, Shanghai and Ningbo are more specialized in the production of chemical products and industrial equipment. Yiwu - accessories, souvenirs, clothing; Foshan - furniture; Shantou - toys; Guzhen - lighting.

For example, products from the “household” category (mops, gloves, rags, etc.) can be searched on various Internet resources that offer a large number of suppliers. Low-cost goods, as well as clothing in relatively small quantities, can be purchased at markets in China, for example in the city of Yiwu.

It is better to look for sophisticated equipment and exclusive products, as well as technological innovations at thematic exhibitions. Before purchasing the main batch of goods, you must obtain product samples from the supplier to make sure that you receive exactly the products that you saw in the photo on the Internet.

If you want to buy a large quantity of goods and are serious about quality, it is advisable to travel to China and visit the manufacturing factory, preferably accompanied by a Chinese-speaking guide. This will allow you not only to thoroughly check the selected supplier, but also to discuss the terms of payment, packaging and delivery of goods on the spot. For example, Delasia is present in all regions of China and can always provide a competent travel companion.

Recommendations for doing business on Aliexpress

In order to start making real money on the resale of Chinese goods without any problems, it is enough to find a high-quality and fairly popular product item at an affordable price, which will be unavailable from competitors for a certain time. Just imagine how much profit ended up in the wallets of the first spinner sellers?!

And if now the idea of ​​​​selling the above-mentioned toys has lost all meaning, then the smartest businessmen tracking the latest trends among the youth YouTube audience, in the wake of hype, set a margin on average from 100% to 1000% per piece.

UPDATED! Subscribe to the “Products for Sale” @sales_b2b on Telegram to stay up to date with current offers from China and more.

Similar situations occurred at one time:

• with fluffy rabbit keychains;
• with “selfie sticks” (monopods);
• with credit card knives;
• with “radioactive” Beats by Dr. headphones. Dre;
• with copies of Swiss watches;
• with frankly unsuccessful, but very popular counterfeits of iPhones and other goods.

TOP 5 rules for forming a product range

As you might have already guessed, finding a product that is in demand and inexpensive for its price that is not available from competitors is a very difficult task. Either very lucky or very experienced sales people are capable of this. But we will talk about this in the following sections of our article, because now it is necessary to dwell in detail on the current rules devoted to the formation of a product range.

Rule #1. Can't organize quality warranty service? Stop selling expensive electronics!

For example, a batch of defective Chinese smartphones, video recorders or action cameras, if it does not call into question the profitability of your business on Aliexpress, will significantly impact your income.

Naturally, you have the right to open a dispute and return the funds invested in the damaged goods. However, the procedure for such a return may take several weeks, and in our case, B. Franklin’s statement that “time is money” must be considered as a truism.

Rule #2. The most profitable topics in the Internet business: “construction”, “car accessories”, “children’s products”, “trends”, “electronics” and so on.

If you may have problems with the resale of building materials from China, then you can and should make money on everything else (from the above).

Rule #3. It is not necessary to purchase a wide range of products on Aliexpress.

Sometimes it is enough to specialize in certain product items, for example, in copies of laptop chargers, since original accessories cost incredible money.

Or you can also open a company store of a specific brand that is not yet officially represented in your country. One of such brands could be the Tauren company, which, judging by customer reviews, produces leather goods of exceptional quality at affordable prices.

Rule #4. The full range of goods you sell must always be in stock.

Otherwise, buyers will prefer to order the necessary item on Aliexpress themselves. Or even worse, they will buy something from your competitors. Hence, there is a high probability of losing potential, but perhaps regular customers.

Rule #5. Carefully monitor the quality of goods, even if they are outright consumer goods.

Do you want to sell cheap products that have a significantly limited service life? No problem! Just make sure that your customers receive purchases that are free from manufacturing defects.

Torn clothes, bent monopods, broken children's toys, broken watches may bring you a penny or two, but in the future, no amount of advertising will help the damaged reputation of an irresponsible seller.

Preliminary testing of product items

Have you already decided on the product?! Don’t rush to make a purchase on Aliexpress! First, test your niche by placing relevant ads on OLX or Avito. Also try to create a thematic group on social networks, with the help of which you can organize sales.

If orders have arrived, then you are doing everything right. Inform interested people that the first batch of products has sold out, and if they pre-order, they will receive a significant discount as a result.

Things are much more complicated with single-page “Landing Page” sites. To check their effectiveness, you will have to buy contextual advertising on Yandex.Direct and/or Google Adwords.

Full-fledged online stores may not need contextual advertising if their search results are able to attract organic traffic.

Advertising of goods sold

Since we mentioned advertising, then it’s worth considering what types of advertising are applicable for a particular online promotion.

To get acquainted with this issue, follow the link

How to follow trends?

YouTube is an ideal platform, thanks to which it will be easy to follow trends even for users who are completely far from the Internet.

The technique is simple as hell. Do you sell toys? Subscribe to entertaining children's channels and see what the younger generation is playing, and also remember what is currently in the ears of the children's audience. If you manage to consider the potential of a trinket, we recommend that you immediately order it on Aliexpress for further resale.

It is much easier to follow fashion trends if you subscribe to English-language YouTube channels, since most popular trends come to us from abroad.

We do the same with other channels. Do you do cosmetics? Then come to the beauty bloggers! Do you sell clothes? Watch fashion vlogs!

Use cashback services

Be sure to take advantage of cashback services when doing business on Aliexpress. This will help you not only reduce the cost of purchasing goods, but also give out discounts or organize promotions without harming your wallet.

How to check a supplier?

The reliability of a supplier can be checked in several ways.

• Verification of documents through the Chinese Chamber of Commerce and Industry. In this case, it is checked how long the company has been operating and whether it has been operating at all, whether arbitration takes place in its practice and on what issues, what kind of turnover the company has according to the submitted tax returns.
• Checking your reputation through online resources. Here, as in working with Russian suppliers, you can view ratings on online sites and read reviews about the company and products.
• Production inspection. The accompanying person can go to the factory to personally meet management representatives, assess production capacity and make sure that the factory really works, is located at the stated address and produces products of a certain type and quality.

We agreed, ordered, received. And the product is bad!

What to do in this case? If you are not satisfied with the quality of the product, you need to issue a return. It is better to pre-register this clause in the contract to avoid unpleasant surprises. Then returning the goods will be much easier.

In any case, you will have to prepare the following documents:

• an act of complaint regarding the quality of the product, which states the reasons for your dissatisfaction;
• invoices for the transportation of goods;
• act of acceptance and transfer of products.

And here’s another advantage of working with large and medium-sized companies: they have representatives in Russia who will help resolve the issue. With small suppliers, the chances of getting your money back are not that great.

How to negotiate and reach an agreement with a supplier?

When communicating with a Chinese supplier, as with a supplier from any other country, it is important to be as clear, polite as possible, and it is necessary to clarify all the questions that interest you, and most importantly not to hope that the supplier can read your thoughts.

The process of negotiating with a supplier in China is a really long process, it is not enough to ask once and get answers to all your questions. In China there is such an interesting concept as “chabudo” - “almost the same.” This means “it will do.” What seems important and obvious to us may be insignificant to the supplier.

Suppliers greatly encourage communication in Chinese. Sellers are delighted with the level of Chinese language skills of purchasing specialists and are always more willing to communicate, ready to be more flexible in terms and prices, and respond faster. And this is understandable, because when you speak their native language, as a rule, the dialogue develops very favorably.

However, some Chinese sellers speak English quite well, and a number of large companies encourage their export-oriented sellers to communicate with clients in English. The only difference is that in the supplier’s native language everything can be discussed in more detail, and the supplier can give a more detailed answer to much more complex questions than simple negotiations “is it available, how much does it cost, what are the terms.”

In China, personal relationships and the development of so-called “guangxi” connections are very important. The Chinese people think in terms of 5 thousand years ahead - this is a cultural feature. For some business representatives, the behavior of their Chinese partner may seem a little slow. At the same time, the Chinese often note the harshness and some callousness of Russian businessmen. It is very important to develop relationships - a kind word or praise will never go unnoticed.

Remember: the golden rules always apply - goodwill, politeness, accuracy in the execution of agreements and, at the same time, control over the production of products.

Is it possible to start your own business from scratch?

Lack of start-up capital is one of the first factors that people cite as the reason why they have not yet started their own business. Inviting advertising messages that promise to teach how to build a business with China from scratch are often viewed skeptically by ordinary people and are closed without even trying to understand the issue. However, there are schemes for interaction with China that allow you to take your first steps in entrepreneurship and earn good money without starting capital.

4 schemes for starting a business from scratch:

1. Earn money from services.
2. Organize information business, conduct thematic trainings.
3. Offer a partnership to your employer.
4. Become an intermediary between the seller and the buyer.

The simplest is resale business with China. To implement the first three options from scratch, longer and deeper training is required.

Checking a large batch of goods before shipment

It is worth visiting the factory to evaluate the quality of the products before the goods are sent to Russia. Checking the goods at the factory makes it possible to send only high-quality goods and leave defective ones, as well as to identify the presence of defective products on site.

This makes it easier to file a complaint - not all suppliers make concessions to replace defective goods, and not everyone even recognizes the presence of a defect when the goods are already in another country. In addition, when a supplier knows that his product will be checked, he is more responsible in the production process.

Inspection of a consignment will be able to eliminate a significant number of problems both with the sale of goods and with further interaction with a specific supplier.

Why is business with China still promising?

People who are skeptical about the popular idea believe that the best time for small and medium-sized businesses to do business with China is already in the past. The cheap price of Chinese products used to make it possible to buy goods in large quantities and earn large profits on the resale of goods. Compared to the zero years, prices have increased significantly.

However, competition and cheap labor put a significant constraint on the cost of Chinese-made products. If you compare prices not with previous decades, but with similar products from compatriots, the advantage of Chinese suppliers is obvious. Despite price containment, the quality of products from China is noticeably improving every year. These factors make doing business with China profitable in 2020.

Sending money

The most common form of payment is bank transfer. To do this, you need to open a foreign currency account in a bank in addition to an account in rubles. In some places, opening and maintaining a foreign currency account is paid, in others it is not, like ours.

The next step is the cost of sending the payment. After opening a foreign currency account, you need to buy foreign currency. You buy currency from the bank at its exchange rate. When making payments in yuan, for example, we add 10 kopecks to the exchange rate, and currency transfer costs 20 dollars.

Another fee that banks usually charge is a foreign exchange control fee. We will explain further what currency control is.

Currency control - how to avoid fines?

When working with foreign companies, you must comply with currency laws. Control over compliance with the law is entrusted to the tax, customs and banks.

If you break the law, then payment of fines may become a significant cost item when importing. Fines can be small or up to an amount equal to the cost of the shipment of goods that you ordered.

What can be broken?

• Deadlines for submitting documents to the bank. According to the law, in some cases it is necessary to provide the bank with documents confirming the delivery of goods and to provide a certificate of supporting documents for these documents. We usually do this for our entrepreneur clients.
• Deadlines for registering a contract. When importing, if your contract with a foreigner is worth 3 million rubles or more, then you need to register it with the bank on time and receive a unique contract number.
• The deadline for importing goods into the Russian Federation after payment of the advance payment or the period for returning the advance payment if the goods have not been delivered.

Delivery of goods from abroad

After receiving partial or full prepayment, the supplier will ship the goods to you. Goods from China are delivered by any possible method: by truck, by train, by sea or by plane. Delivery costs depend on the speed of cargo movement. The most expensive and fastest method is considered to be air delivery, and the cheapest, but the longest, is sea transportation.

To understand which delivery method is best for you, you can contact the logistics company and tell them the weight of the cargo and its dimensions, as well as where the cargo will go from and where. Then the logistician will be able to tell you the cost of transportation.

How much money does it take to open a Chinese goods store?

An obvious problem for any beginning businessman is high competition in the market and lack of experience in the chosen field. In addition, many people try to implement clothing sales ideas, and in most cases they make their business successful. Buying a franchise to collaborate with a specific brand is a common way to start your own business. Sales specialists believe that only an individual entrepreneur with good start-up capital and experience in the fashion industry can implement business ideas in the form of clothing or footwear stores from scratch. So, business ideas based on concluding a franchise agreement are an excellent option for a successful start.

It should be understood that a franchise from a well-known brand or manufacturer is attractive due to its potential profitability. The work of the chain of stores that sell clothes from China has been established for a long time, and relieves a new participant in this business from many worries. In addition, along with the product, the individual entrepreneur receives a number of recommendations on the work and marketing policy of the brand owner, as well as guaranteed sales and a high stable income.

Customs

Once in Russia, your cargo undergoes customs clearance. The importer must submit a standard package of documents confirming the composition, origin and value of the goods. Until customs permits the “release of the goods,” it will be stored in a temporary storage warehouse (temporary storage warehouse). There, the goods are stored for free for three days, then for each day of storage you are credited with a certain amount.

Each product passing across the border is assigned an individual HS code, which determines the amount of duty, VAT and permits for import into Russia.

Having enough experience in working with customs, you will be able to independently carry out the cargo declaration procedure, however, it will definitely be better to delegate the first deliveries to a licensed customs broker.

This will save not only time and nerves, but also a significant amount of money, since the responsible broker will definitely offer the most suitable HS code and, if necessary, help prove to customs the correctness of its application. The cost of customs broker services, as a rule, varies from 15 to 25 thousand rubles.

To clear goods through customs, permitting documents may often be required. Their registration can take from two days to one and a half months, depending on what document is drawn up (declaration or certificate of conformity). Costs also vary significantly depending on the cargo and the reliability of the certifying authority.

Even at the stage of negotiations with the supplier, you know what product you want to bring and its main characteristics. A broker or bank will help you determine whether you will need to obtain permits for your product, as well as what exactly you need to provide to clear customs.

Comparison of costs when purchasing large and small quantities of goods in China

For example, we imagined that we want to bring all the consignments of goods described below to our company, that is, in the declaration of goods our details will be indicated as the recipient. For the calculation, we took the average prices for the main types of related services. Delivery method: by truck. The dollar exchange rate is 66 rubles.

It is worth considering that the cost of services can vary greatly depending on the type of cargo and loading location. We also did not take into account the costs of promoting and selling goods in Russia.

Option 1. Let's imagine that we are carrying a children's toy - a large radio-controlled robot. First, we purchase a small batch of 32 pieces and check the demand. The robots have been sold out, and we are purchasing a batch of 100 pieces.

Comparison of costs when purchasing different batches of robots

*The customs duty rate for this type of toys is 10% and VAT 20%. Rate may vary. To accurately determine rates, it is necessary to determine the HS code based on an accurate description of the characteristics of the product.

Option 2. One of the most popular products in the summer is an electric scooter. Let's order 10 pieces first, and then 100.