Explained How to find good suppliers for beginner of Trade? by Video
Hello, this is IINO.
In this video, I would like to talk about finding suppliers in the import trade for companies who want to purchase goods from overseas for the first time.
Purchasing goods from overseas is entirely different from buying goods domestically.
Trading with other countries requires a different language, a different culture, and different business practices.
People who are not familiar with trading need to be careful anyway.
Even though it is not easy to purchase goods from overseas, it is attractive from a cost perspective.
By watching this video, you can learn what you need to check before actually purchasing, and reduce the risk of import trade failure.
So let’s get started.
Decide what to buy
First of all, you need to decide what you want to buy.
If it is a product related to your current business, you should note price and quality to select suppliers.
, if you are starting import trade as a new business, you will need to do some marketing to find good products.
There is a detailed explanation of marketing in another video, which you can check the link in the description.
Choose a country to import from
Once you decide on the product you want to import, the Next step is deciding which country you import.
Choosing a country is very important.
Don’t just look at the cost of the product.
If the country is politically unstable, has no preferential tariffs, or is too far from your country, you will lose the price advantage away.
Pay attention to the distance of the country you are purchasing
Let’s talk a little more about the distance between countries.
For example, if you buy products from a European country to Japan, it will take about 40 days to transport by sea.
This makes it difficult to adjust stock control, and cash flow during the transportation period will be poor.
It is also expensive for you to travel to check the production.
However, if your product is unique enough to make up for the disadvantages of distance, or to differentiate yours from other companies, there will be no problem.
There is the case that the company based in Europe or America, but the actual country of production is in China or Southeast Asia.
I like this country!
Some companies decide on the country they are purchasing from because they like the country very much.
I work in Thailand, and I know several small and medium-sized companies that purchase from Thailand simply because they like Thailand.
I used to deal with feed in Belgium before, and I started this business because I wanted to drink Belgian beer.
I think it’s pretty common for small businesses to start with that kind of enthusiasm.
How to find a company to buy from
So, once you decide on a country to buy, how do you find a company to buy next?
Use the Internet
Nowadays, you can get enough information on the Internet. Just enter the keywords to search, and contact the relevant companies by email or phone.
One-time contact is not enough to get a reply, so if you are serious about starting a business, approach them many times.
It is also advisable to visit trade shows. Exhibitions are held in many different countries.
It costs a lot of money to open a booth at an exhibition, so the suppliers try to find good customers or distributors seriously. An exhibition will be a good opportunity to promote business negotiations more quickly.
Use a trading company
If you are worried about the difference in language and business customs, it is better to use a trading company specialize in a particular field.
They will import the goods to your home country, so there is some cost as a margin.
However, you will be able to purchase the small lot, and sometimes they will stock the goods by themselves, which is an advantage.
Using JETRO/Chamber of Commerce
Another option is to use JETRO or the Chamber of Commerce.
These organizations support companies trying to expand overseas. They provide you with information about local companies and the market situation.
Importing is less difficult than exporting.
This is because you are a customer, and it is easier to find suppliers than sellers.
If you are a beginner in trade, it is better to start with importing than exporting.
Pay attention to your supplier’s credit
This is the most important part.
When finding a foreign supplier, you need to be careful about the credibility of the company.
In the case of importing, there are some problems whether the company will send you the goods you paid for, product quality is followed to the specification, or they are responsible for the delivery schedule.
I believe that these credit risks are higher when you start doing business with a foreign company only by email.
You will not meet them face to face, and you will not know if the company exists.
Some companies ask you to send money again because of additional costs or make an unreasonable request.
To reduce the credit risk, you can use the L/C or B/L.
These are explained in detail in another video, which is linked in the description.
Using the Dun Report
If you want to find out more about the company you are dealing with, you can use the Dun Report.
Dun & Bradstreet Corp, one of the largest credit reporting agencies in the U.S., will verify the creditworthiness of your business partners.
Dun Report does credit checks for companies in most countries except for conflict zones.
Now let’s summarize the contents of this article. When starting an import trade, first select a country to purchase from.
Why do you want to buy from that country? You need to check how much benefit and whether the lead time and cash flow risks are acceptable.
Once you decide country, the next step is to find a company to purchase.
How do you find a supplier?
Use the Internet
Visit an exhibition
Use a trading company.
Use JETRO or the Chamber of Commerce and Industry.
There are several ways to find suppliers.
Since overseas companies are physically far away from you, you need to check the credit risk carefully.
If you are not careful, it causes that the product is not sent to you even though you have sent money, you may have quality problems or a big cargo delay.
To avoid this kind of risk, you can use a Dun report to check if the company is trustworthy or not. And use L/C for transactions, B/L for control logistics.
As you can see, if you don’t have the proper trade knowledge, you could lose a lot of money, so keep learning on this channel.
If you haven’t subscribed to the channel yet, please do so at the end of this video.
That’s it for this episode. Thank you very much!
Contact to IINO san