How many times have you seen or heard the story of someone dropshipping from china claiming big money from the sale and distribution of a product made in China? Well, let me tell you about the stories that don’t see the light of day.
If you have an interest in drop shipping and are seeking to learn more about it here are a few points that most people won’t tell you about the world of drop shipping.
The Facts about Dropshipping from China
Most Chinese Products are FAKE!
It is no mystery that China’s manufacturing industry is booming allowing them to manufacture just about any product in the world. Being the masters of copying China is able to knock-off even reputable brands and avoid litigation thanks to fragile laws governing patents and trademark.
Selling counterfeit products is a crime and can severely damage your market credibility and reputation. Not just that services like Paypal will block your account in cases of complaints of counterfeit products that can destroy your business before it begins.
Longer Than Average Lead-Times
Everyone believes dropshipping from China is a fairly easy process but in reality, it couldn’t be more complicated. Delays in shipping and long delivery times sometimes up to even six weeks can make it a real nightmare for business owners to manage inventory and regulate cash flow which are two crucial aspects of a successful drop shipping campaign.
Customers hate having to wait for products that they have already paid for which makes buying from China actually quite risky!
Your Customers Actually Become Importers
Best of all when you are dropshipping from China and your customers finally receive the package they had ordered it can often be accompanied by a letter from customs asking for import duties on the product.
Paying the import tax can actually make the product more expensive than buying local. Not just that the fact that your product can come with instruction and labeling in Chinese is never what a customer wants especially if they brought it from a well-designed and credible e-commerce platform that they expected would deliver a high-quality product at a reasonable price.
Beware! Drop shipping from China leads to products that rarely meet the international safety standard and guidelines and can be held at customs for a variety of reasons.
In most cases, Chinese products are disguised as gifts to avoid customs charges and duties and have a lesser value invoice than that which was originally paid which can put you in quite a complicated scenario.
The only thing you can do in such a case is to forget about the product and make sure that the one who sold it to you pays!
Products such as electronics, cosmetics, toys, and tools rarely get past customs as they never meet the desired regulations and guidelines and without safety licenses, these products cannot be allowed inside the country.
Higher Margins Can Translate to Lower Income
Most people get attracted to dropshipping from China because they are so focused on product that are much cheaper and offer such high margins.
In the short-run, this might work great as a cheaper priced product is likely to sell more but with the product already being so cheap those high margins don’t necessarily translate to lots of income.
In fact, you have to sell a lot to make the same that you would have made from selling much less of a premium product.
Not to mention all the headaches that you will have to face in terms of expensive returns and chargebacks from products being shipped late, being held up at customs or damaged upon receiving.
In most cases, dropping shipping reliable premium products that may offer lower margins can actually translate into a lot more Income as you have fewer problems to deal with and much happier customers.
The key to a successful dropshipping business is negligible returns that are normally the case when selling well-reputed branded products. However, generic products from China even if they are branded are not always of the same quality that customers expect.
Also since these products are made in large volumes with minimal quality control defects and damages are to be expected.
This starts to hurt a lot when your order volume starts going up with these returns and complaints driving down demand and eating away your profits. Returns can be quite expensive as the product is being dropshipped from China and can severely impact business growth.
Ethics & Apathy of Chinese Manufacturers
Chinese manufacturers will often turn their backs to things like returns, claims, complaints, and refunds. This is true for even large well reputed Chinese manufacturers.
When drop shipping products from China things like standing up for product quality and taking measures to reduce return rate go out the window.
Most Chinese manufacturers only seek to produce and sell in volume giving very little thought to many aspects that make a product safe, convenient and durable for use.
Questionable ethics and business practices make drop shipping from China a lot riskier that one would imagine especially when things start to go wrong.
Scams & Fake Suppliers
How many times have I heard the story of some Chinese manufacturer scamming money from a client and never delivering the product as described? Sometimes they simply flee with no way to get in touch while on many other occasions the product you receive is often made of much inferior quality and materials than the one promised.
China is full of scammers and fake drop shipping suppliers that are out to make a quick buck and for all you potential drop shippers out their BEWARE!
Are all Chinese Manufacturers Like This?
Not at all. They are some quite reputable Chinese manufacturers that seek to use ethical and international standards when manufacturing products for companies overseas.
However, the number of Chinese manufacturers that do not follow international regulations and guidelines far outweigh the ones that do.
In my experience drop shipping products from around the world, I have found Chinese products to be amongst the hardest to maintain and drive long-term profits from.
If you are in this business for long-term sustained gains than drop shipping from China may not be in your best interest.
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