China export is a complicated process as there many things to consider. The most important China export consideration is the order quantity. Australia is a great place for importers as regulations are straightforward and importers do not need to have a license.
If you’re looking to export from China, then the first thing to check is whether the goods that you’re looking to import are not on the list of restricted or prohibited goods. Australian Customs and Border Control have a detailed list on their website, Click here.
China Export: Small vs Large Orders
1. Delivery – Although prices are cheaper in China, importers must consider the price to export the goods from China to Australia. Shipping, GST, Taxes, Customs clearance and overland delivery in Australia are expensive so it adds a lot per unit if you order small quantities. Full container loads are the most optimal order quantity for the best price per unit.
2. Factory Quality – If you order small quantities then you are forced to use poor small quality factories that are a nightmare as they use old machines and cheap materials. They often use harmful chemicals to cut corners that are at risk of not clearing Australian Customs.
3. Bargaining Power – When you order lower amounts and want to use the high-quality factories you are forced to pay higher prices as these manufacturers simply do not need your business as they have contracts with large international companies. An order of $15,000 AUD is normally a good benchmark to follow to get access to premium factories but you have to pay a premium for the product. The more you order the better the unit cost and orders around 40-60k are when things become most attractive.
4. Factory priority – The quality factories are busy and will put small orders at the back of the queue. The greater the percentage of their business, the greater priority you will get. Factories often take on business knowing they can’t meet the stated deadline to secure a deposit from a customer. What often happens is that large orders come in and the smaller orders get delayed as it is not as important for them. MyShipper buys in bulk at the factories as we have multiple orders at once and often have a long history with the factory so we can keep them more accountable to deadlines. Our lead time is 45 days on average vs 90 days as an overseas small purchase. Importers buying small quantities will often be waiting a long time to get their product.
5. Material MOQ – Suppliers have MOQ’s from their sub-suppliers. The supplier has to buy raw materials from their supplier and these may not be small. So while the factory may be willing to run your order sometimes they can’t due to martial MOQ from other factories. So this makes small production runs difficult, even with small factories.
6. Quality Control – Small orders mean there are is simply no budget for quality control as it means you can’t afford to pay an agent to guarantee the quality of the goods.
7. Customisations – Chinese manufacturers produce in large volumes and they prefer products that won’t need many changes. Most customers want branding and customization that factories are reluctant to undertake for free on small orders so the price naturally rises on small orders. MyShipper specialises in branding and customisation as it creates more value in Australia but we need to have a bulk order to help us negotiate with the factory.