Home Forums Starting your journey Finding a product supposed to be this Difficult?

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  • #991394
    neek0la
    Member
    • Total posts: 5

    Hi All

    Ive taken a shot at importing products from china and reselling them in eBay.
    I imported a product which i thought that i would make a decent margin on. How wrong i was. After paying shipping costs, broker fees, customs, duty, ebay and paypal fees (not to mention most of my items were damaged from the shipping company), i sold them item for a total profit of……drum roll……. $3.

    Now that the Ozzie dollar is so low, makes it a lot worse. I have since spent every free moment i have for the past month researching and speaking to suppliers for potential products with no luck.

    Do you all encounter this? Any advice would be great

    #1181366
    ThexArm
    Member
    • Total posts: 253

    So, is that $3 the gross profit?

    You may not have included costs of other admin expenses such as rent, phone, Internet, traveling exp etc.

    I guess most of the start ups go through the same way. It’s a learning experience. But, some people use consulting services to minimise losses. From your post I can see that your prices are not correct as it may not cover all your expenses.

    If you like to work with low margins then your should ensure you could generate high volumes. Make sure you understand your break even volume to be profitable.

    Sent from my iPhone using Tapatalk

    #1181367
    bb1
    Participant
    • Total posts: 4,485
    neek0la, post: 211525 wrote:
    Hi All

    Ive taken a shot at importing products from china and reselling them in eBay.
    I imported a product which i thought that i would make a decent margin on. How wrong i was. After paying shipping costs, broker fees, customs, duty, ebay and paypal fees (not to mention most of my items were damaged from the shipping company), i sold them item for a total profit of……drum roll……. $3.

    Now that the Ozzie dollar is so low, makes it a lot worse. I have since spent every free moment i have for the past month researching and speaking to suppliers for potential products with no luck.

    Do you all encounter this? Any advice would be great

    The lesson here for everyone is to do your research before you purchase an item for sale, it is not just the price you pay for the item, you need to research the costs of top of that, research the market for what you can realistically sell the item for. And if the 2 don’t leave you a profit that you are happy with, well you can guess

    #1181368
    Jason Ramage
    Participant
    • Total posts: 3,162
    neek0la, post: 211525 wrote:
    Hi All

    Ive taken a shot at importing products from china and reselling them in eBay.
    I imported a product which i thought that i would make a decent margin on. How wrong i was. After paying shipping costs, broker fees, customs, duty, ebay and paypal fees (not to mention most of my items were damaged from the shipping company), i sold them item for a total profit of……drum roll……. $3.

    Now that the Ozzie dollar is so low, makes it a lot worse. I have since spent every free moment i have for the past month researching and speaking to suppliers for potential products with no luck.

    Do you all encounter this? Any advice would be great

    Hi Neek,

    This could be awesome, if you invested $1 that is 300% margin.. Sweet.. But i assume by the tone of the message that this is not the case :(

    My comment, coming from an experienced importer, would be that this journey is fraught with danger and without knowing much more about you personally is difficult to say if this is normal or not. What i mean is that there are quite a number of people that perceive importing is simple, identifying products is easy, knowing what you need to know is correct and so forth when in reality this is extremely tedious and quite costly.

    Furthermore, i also seem to encounter many people trying to import and if you can not buy the said item at the right price you are already pricing yourself out of the market. And in most instances, most people i come across are importing such small quantities, not saying this is right or wrong, that making a decent margin is near impossible. Meaning they can not negotiate best prices for goods, nor get cheapest shipping options to benefit them, etc.

    Another hurdle is always shipping, this is not a plug for me at all, as they tend to shop for the cheapest quoted price and this tends to burn most first or second time importers until they realise that knowledge and expertise has a price… Not a heavy one, just pay accordingly.

    It is about research, sampling, etc and sometimes can take many trials before you get it right. So the less you import the less profit, especially if you sample every supplier… Lets say you import a $5 item as a sample, there is $5 + $30 to ship etc so that $35. Lets say you want to import $1000 worth of products, your sample on your first shipment is almost 4% of your cost to start with.. And then if your goods are damaged and you skimped on getting insurance to cover your goods, oh boy.. there is more money gone, and then if the product has faults (which a small % tends to) there is more money down the tube :(

    Sounds negative, but its not, it is just based on economies of scale.. Everybody in importing is hurting with the USD and will potentially go further down, so your research and learning will need to keep up to speed with demand and supply so you know where you stand every step of the way in your journey.

    Lastly, without knowing your investment amount, i am going to say that this could have proven an extremely valuable learning curve and on your next import you may avoid certain traps and pitfalls that may have prevailed this time (and will watch for next time) and allow you to increase your profits considerably..

    Cheers, and dont be disheartened.. We dont always get it right first time around, not many babies learn to walk without a few stumbles along the way :)

    Jason

    Jason Ramage | Lucas Arthur Pty Ltd | E: hello@lucasarthur.net.au   P: 61 3 8324 0344    M: 61 412 244 888
    #1181369
    neek0la
    Member
    • Total posts: 5

    With everything that has happened, i do not believe that i have lost. I have gained something way more valuable…. knowledge, and as they say knowledge is power.

    FYI the initial price for the product was $88USD so i definitely wasn’t a 300% increase lol

    I guess i’m just frustrated. Not so much in the shipping process, that all makes sense to me now, but the fact that i wont be able to compete with other ebayers to make it worthwhile.

    #1181370
    Jason Ramage
    Participant
    • Total posts: 3,162

    Neek

    It’s near impossible as an importer to compete with prices on ebay, and that is for many reasons including:
    – the fact you are competing with manufacturers
    – high shipping prices
    – people using loss leaders
    – and so forth

    If you want to compete on price, chances are you will not begin again as there will always be someone cheaper in some way…

    Cheers
    Jason

    Ps.. Being short as my roast pork is ready :)

    Jason Ramage | Lucas Arthur Pty Ltd | E: hello@lucasarthur.net.au   P: 61 3 8324 0344    M: 61 412 244 888
    #1181371
    SourceSmart
    Member
    • Total posts: 64

    hello Neek,

    Well done on making the step also, i talk to many people who want to import but don’t make that 1st step.

    As Jason said, its a learning experience for you.

    I think there are other ways the import and sell with out using Ebay. The problem i find with smaller importers is they are trying to compete against bigger importers on Ebay. Who purchase bigger qtys with a lower cost and also the shipping cost per pc is alot less as they are importing in 40′ containers.

    Good luck!

    Warren.

    #1181372
    bb1
    Participant
    • Total posts: 4,485
    SourceSmart, post: 211544 wrote:
    I think there are other ways the import and sell with out using Ebay. The problem i find with smaller importers is they are trying to compete against bigger importers on Ebay. Who purchase bigger qtys with a lower cost and also the shipping cost per pc is alot less as they are importing in 40′ containers.

    Good luck!

    Warren.

    Warren what other ways do you suggest

    #1181373
    SourceSmart
    Member
    • Total posts: 64

    Hey Bert,

    I think depends on the products to a certain degree.

    I was more referring to b2b type sales.

    I think direct marketing to the potential customers is sometimes better.

    For example if i was importing ‘Floor tiles’ i would call / talk to floor tilers about my range of floor tiles.

    I had a client importing boxes/ packaging for florists and she went and visited florists and built up her sales database that way.

    This is what i have done with some of my products over the years.

    Warren

    #1181374
    neek0la
    Member
    • Total posts: 5

    Hi Warren

    I don’t think the problem is with the discount for a 40″ container. Majority of suppliers that I talked give me a quotation based on a full container load and I still can’t make the numbers work. I’ll give you an example.
    I got a quotation for a external aquarium pump. Best price I could get it was 47usd based on a 40″ container. If I wanted to purchase a small quantity of 100 it would be extra 12usd extra.
    It sells on eBay for 105aud with free shipping. Once I workout exchange rates. Import fees. eBay and PayPal feels. There is nothing to make. Yet others are selling the exact same product. In assuming that they are doing well because they have sold over 400/units.

    #1181375
    SourceSmart
    Member
    • Total posts: 64

    hello Neek,

    How many in a 40′ Container?

    Warren

    #1181376
    neek0la
    Member
    • Total posts: 5

    Hi sourcesmart
    From memory it was 1000’s.
    I don’t have the numbers in front of me at the moment

    #1181377
    IMEX Sourcing Services2
    Member
    • Total posts: 42

    Hi,

    First of all congrats on taking the plunge. I wouldnt look at this as a failure but a stepping stone to a more profitable import business. International trade has a sharp learning curve and it takes a few shipments and ideally lots of reading/mentoring before you have a solid business plan in place, so my first suggestion is, please dont give up, re-evaluate your business model, crunch more numbers, have a proper spreadsheet for calculating the cost from supplier to your customer’s door, including ebay charges. Set yourself a decent profit margin target to account for contingencies and at least 3% – 5% product return/warranty claims/damaged in transit goods. If you are looking at a $50 product, I would look at at least $20+ gross margin.

    Coming on to the MOQ issue, we work with a lot of buyers who cant source factories MOQ and there are lots of work-arounds to this, without having to pay massively more. But the key to success under such scenarios is to come up with “Niche Products” with little competition. When selling online and purchasing in small quantities, the absolute key is to do very solid “product research”.

    Good luck with your next import.

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