Successful Sourcing and Importing Overseas
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Transcript of Successful Sourcing and Importing Overseas
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Successful Sourcing and Importing Overseas
Tim Redhed
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Overview
• Purpose of this class– Offer practical, real-life advice on how to
effectively source and import products
• Background
Tim Redhed
Global Sourcing Specialist
YourBuyer Inc.
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Sourcing
• Overview: using common sense– Does it make sense to import the product?
Weight, labor, commodity vs. specialized– What are the likely countries?– Trusting your instincts– Avoiding assumptions– Guerrilla sourcing
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Sourcing, cont’d
• Searching for suppliers – – Google vs. Trade Portals– Specific portals: Alibaba, HKTDC, Global
Sourcing, TradeEasy– “Gold” or “preferred” suppliers– Foreign consulates – export promotion– Referrals
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Sourcing, cont’d
• Trading groups vs. manufacturers– How to differentiate– Pros/cons
• Contacting– Email vs. Fax vs. Phone vs. In-person
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Importing
Ok, I found a vendor, NOW what do I do?1. Find a good customs broker
2. Find a good freight forwarder
3. CIF vs. FOB pricing
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Negotiating
• Cross-cultural communication– Do your homework on the culture– Listening as an art– Buying is the same as Selling
• Recognize that the vendor you want may not want you
• Multiple vendors
• Terms– 100% TT, 30/70, Letters of Credit
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Calculating True Costs
• Tooling charges
• Sample charges
• Inspections – SGS or other
• Duty rates – HS codes
• Customs broker/port/FF fees
• Freight – international & domestic– CBM, peak rates, EBAF, palletization
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Top Mistakes When Importing
– Vendor not properly qualified– Product quality didn’t meet expectations– Pricing changed at last minute– Underestimated freight charges– Production delays not anticipated– Freight delays not anticipated– “Manufacturer” was really a trader with no control– Wrong HS code, wrong duty rate– Customer staff not properly trained on the nuances of
importing
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Summary
• Source creatively
• Negotiate by listening
• Manage expectations
• Never assume!
• YourBuyer, Inc. as a sourcing tool
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Appendices
1. Major trade portals
2. Government links & miscellaneous tools
3. Sample costing worksheet
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Appendix 1: Trade Portals
• Asiawww.alibaba.com
www.hktdc.com
www.globalsources.com
www.ebigchina.com
• North Americawww.thomasregister.com
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Appendix 2: Gov Links & Misc. tools
• USITC Tariff and Trade Data site– http://dataweb.usitc.gov/scripts/tariff2004.asp
• HS Code lookup– http://trade.netvigator.com/gtd/english/html/3_mc.asp
• Conversion tools– http://www.onlineconversion.com/
• World Clock– http://www.timeanddate.com/worldclock/
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Appendix 3: Sample cost worksheet
Costs Unit Unit Totals
Product Cost (ex-factory): $ 1.000 $ 39,800
International Freight: $ 0.09 $ 3,415
Misc. Labor Costs (palletization, etc.) $ -
Domestic Freight: $ - $ -
Domestic Fuel Surcharges: $ - $ -
H.S. Code
Duty Rate 1 - % 3.00%
Duty Rate 1 - $ $ 0.030 $ 1,194
Duty Rate 2 - %
Duty Rate 2 - $ 0 $ -
Bond: $ 0.003 $ 119
Broker Fee: $ 0.003 $ 125
Misc Fee (Processing): $ 0.002 $ 84
Misc Fee (Maintenance): $ 0.001 $ 50
Inspection fees @ $1000 ea.: $ 0.025 $ 1000
Miscellaneous Costs 1: $ - $ -
Miscellaneous Costs 2: $ -
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Questions