Deal in product you understand
In mid 70s I took a trip to Taiwan. It was about the time I was getting started in import export business, with only a handful of small shipments behind me from India. The trip was inspired by the fact that at the time Taiwan was the country where significant amount of the imported goods in the United States were coming from, namely in the area of consumer goods. Back then Taiwan saw practically no tourists and when I checked in at the hotel I registered as an importer. Next morning at 7 AM the phone rings, “Sir, this is reception – you have people waiting for you.”
“Nobody knows I am here?” I objected, knowing well I didn’t announce myself to anyone before coming. How, who? I wondered. It was because I checked in as an “Importer.”
Those that waited for me in the lobby claimed they were notified by – they made up some name of some company I never heard of; basically they wouldn’t say or I gave up trying to find out – they were teeming in samples and I did not press who, how and let them show me what they had: they were offering me samples to quote sheets with all the details – unit costs, quantity discounts, delivery times etc. They presented products from plastic hosing to impulse item gadgets, key chains to short wave radios built into baseball caps, but also tennis strings, outdoor furniture, and whatever else I could think of they could get for me within an hour.
In a week’s time in Taipei I had met, run into or they run into me scores of export company representatives, all offering great deals on products I could buy from them and import into the US. All pricing looked very good, quality was good, and I was feeling good about taking the trip.
But it was not long after I got back to US that I realized that it took some research to find out who distributed plastic hosing or tennis strings, to learn what was top quality vs. marginal quality, what were the current wholesale prices, quantities that the product was coming into US on annual basis already, or who were the main players in the retail sector that sold the product to the public. In short, the more I started to look into the variety of products I was offered to import, the more I realized it was not as clear cut to make the decision to import or not to import. There was competition and many of the products I was offered were not suddenly looking as good as I thought at first; may be if I ordered in the largest quantities I could compete but I did not have the budget to start big. Above that, I realized that to sell plastic hosing I better learn more about plastic hosing, who used it, where was the biggest demand, seasonal fluctuations and similar issues. In other words it dawned on me very quickly I best stick to a product I understood, I enjoyed handling and I already had some direct experience with. Thus I recommend if you wish to start importing toy around with products you might have already been involved with in your career or your hobby; do that first. Then dig within the framework of those products and related product lines and dig deep. Above all try to analyze your buyer, those who you will be selling to – no one has ever failed in business by overanalyzing his customer! More on that later.
- Sourcing readymade products vs. product development
- Fair Trade – where people come before profits