How to Approach Chinese Dropshipping, Wholesale, Private label Suppliers

Oct 07, 2021 Chapter 1. Sourcing

This article will discuss how to approach a new Chinese wholesale, dropshipping, Amazon private labeling or local supplier. 

You have collected a list of potential suppliers you want to work with from the trade show, Alibaba, or manufacturer’s distributor list.

You may have never bought in bulk from China, and you do not have your website or domain name. You are very worried when you first contact the Chinese supplier.

So what will you do? You procrastinate…

There is a voice in your mind telling you that maybe I should build a website first, start a company or limited liability company(LLC), or maybe I need a business card. But, in fact, you should figure out what you want to sell as soon as possible and determine your product sourcing strategy.

We recently received an email from one of my readers who was a little worried about how to contact their first Chinese supplier.

 

Hello,

I just wanted to say thank you for the extensive information you provided on your website. I find it very valuable and inspiring.

I just started my new business and hoped you could help me? I have made a decid on the kind of product I want to work with, but I stopped. when I contacted my supplier. What came to my mind was:

How can I contact my supplier? For example, what kind of opening letter/email should I write?

Before I contact my supplier, should I decide on a company name and get my website up and running?

How should I answer “How long have you been in business?”

 

So, I hope you can explain the above question. Do you have any letters/email samples that you used when you first contacted a potential new supplier?

 

 

Choose A Sourcing Strategy First

First, the way you approach suppliers depends on your purchasing strategy.

 

Do you want to do dropshipping?

Do you want to buy in bulk from China?

Do you want to develop private label products in China?

 

All these models require a slightly different game plan.

The most important thing is that dropshipping is very different from wholesale.

Similarly, importing goods from China or dealing with Asian suppliers also require different strategies.

But don’t worry. I will explain how to approach a new supplier one by one for you in this article.

 

 

How To Approach Wholesalers In The US Or In Your Own Country

When it comes to buying wholesale products for your e-commerence store, wholesale goods in your own country is by far the easiest way.

There are very few restrictions, and most suppliers are willing to work with you, no matter your level.

For example, in the United States, you only need a seller’s license or business license. You don’t need a website. You do not need to have a company or limited liability company.

You can simply make a call or email the wholesale supplier, tell them you want to help them sell the goods, and ask them how to buy.

If you are in the United States, they may ask your seller permission for tax purposes and tell you their minimum order requirements. That’s it!

 

Note: Some sellers won’t even require you to provide a seller’s license! But with it, you can purchase supplies tax-free. It also indicates to your supplier that you have actually or are trying to start a real business.

 

In addition, the law requires seller permission before you start selling online because you need to pay sales tax in your state.

According to my experience, in the United States, most wholesale suppliers have very reasonable minimum purchase orders, a few hundred dollars, so your upfront costs will not be too bad. (Minimum order requirements vary by supplier).

In general, it is super easy to take the wholesale route.

Because you are buying products directly, suppliers usually don’t care if you are a mature business because they will get paid anyway.

Once you have established a continuous order record, you can request a “net 30” payment term. “Net 30” is a form of trade credit that allows you to pay after 30 days to help your cash flow.

 

 

How to approach Suppliers for Drop shipping in your country

Although it is super simple to buy products wholesale, asking the supplier to do drop shipping for you is another matter.

Why?

This is because when you buy wholesale, the transaction is simple. You pay the seller, and the seller will send the goods to you.

But when it comes to drop shipping, you are essentially seeking partners, not buying products in bulk. Your supplier will fulfil each of your orders.

In addition, you must work closely with them to ensure that the packaging and inserts show your brand and not theirs.

In short, the commitment that a dropship supplier must make is far greater than a simple wholesale arrangement.

 

 

Dropshipping supplier requirements

Therefore, before contacting the dropship supplier, you must be fully prepared because you must make people feel that you are a legitimate business owner.

Not only you have to have your seller’s license, but you also need to prepare a professional website in advance.

And many more? How can I build a website before I have nothing to sell?

Just because you have a website does not mean it has to accept transactions. Just because you have a website does not mean it needs to be fully functional.

If I look for a dropship supplier, I will use Shopify or Open Cart to build a fast and simple website, using stock product images to make it look like a real store.

Remember: You are asking your dropship supplier to become a partner. Unless you can prove that you have a plan to promote sales, they will not be willing to work with you.

Is a professional website necessary now?

Do not!

But have a good-looking website can convince suppliers that you are worth their time. The choice is yours.

 

 

Evaluate Your Dropship Suppliers

You also need to conduct your own due diligence once you show your dropship supplier that you are a serious buyer.

 

Here are some questions to ask the dropshipping suppliers:

 

Do you have to pay a delivery fee?-Usually, the dropship supplier will charge a fee for each order to be completed.

Once an order is placed, how long does it take to ship the product?-Customer service is the main focus of dropshipping

How to place an order? (phone, fax, email, promotional video)

Do you support EDI? EDI is a way to get real-time inventory data from your suppliers to don’t sell out-of-stock items.

How to track orders? -Will they send shipping and tracking information to customers?

Can you write my company name and logo on the packaging?-It is important to apply your brand name on the package.

 

Note: If you are looking for a good place to find dropship suppliers, worldwide brands can save you time by classifying and categorizing suppliers in a large database for you.

 

 

How To Approach Chinese Suppliers or Overseas

If you want to sell private label products online or sell your own branded products, the best way is to manufacture your products overseas.

This is not as scary as it sounds. But dealing with Chinese suppliers is very different from dealing with American suppliers.

First, they don’t care about licenses or certificates at all.

 

You do not need to have a seller’s license.

You do not need to have a company or limited liability company.

You don’t need to have a real website or anything esle!

 

The only thing that Asian suppliers care about is whether you can continue to buy a large number of products.

Therefore, when you contact them for the first time, you need to make them feel that you have big purchasing power.

Here are some rules of engagement that I often use:

 

Never contact them as a boss or boss. You can pretend to be a buyer or subordinate of the company

Never let them know that you don’t know what you are doing. Instead, show Confidence in your emails and communications. Don’t ask stupid questions that are easy to find with a Google search.

Never tell them that you have just started. If they ask about your website and you don’t have one, tell them that you mainly sell products in retail stores or kiosks in malls.

Never give them an incomplete website. If your website is not ready yet, then there is no point in showing it off. If you tell your provider that your website is empty or incomplete, they will not take you seriously.

 

At last, Confidence is the key.

 

You must be decisive, know what you want, and communicate to suppliers that you want their products to serve your business.

If they think you are just a novice, they will not reply to you or reply to you for a long time. In some cases, they will even give you excessive prices so that you will leave.

 

 

Ask About Minimum Order Quantity(MOQ) from Your Suppliers

Assuming your supplier has something you want to sell, I usually solve the minimum order quantity(MOQ) problem.

Before you start contacting, you should know how much you can buy and how often. If you don’t have any customers, this is a difficult question to answer, but the reality is that you need to make educated guesses, not indecision.

Be sure to figure this out first.

Once, we spent a few hours chatting with a hawker, only to find that their minimum purchase amount was US$50,000, which was far beyond our ability.

Different suppliers and distributors are dealing with different types of customers. Make sure you are dealing with the right people for your business.

I usually ask the MOQ question in a very subtle way.

For example, I might ask…

 

Would you please give me quotations for 500, 1000, 5000 and 10000 units of this product?

 

If the supplier is far beyond your capabilities, they will tell you. But if the supplier is in this range, you won’t be treated as a novice asking this question.

Once you are sure that your purchasing power is matched, you should always ask for samples to evaluate product quality.

If these samples pass the test, we will ask some other questions.

 

What is the lead time for production?-Typical lead time is usually around a few months

What is your payment method?-How much advance payment is required. Usually, you have to pay a 30% deposit first and then pay the rest after the completion of the goods

How long have you been in business?-You generally don’t want to work with a brand new factory

How big is your factory?-Sometimes, I will ask to visit the factory via Skype

What other related products do you produce?-If they sell a bunch of different items, this is usually a bad sign that they are not a real factory.

What are your existing customers in the United States?-I prefer suppliers that work with Western countries.

 

 

Different Chinese Suppliers Cater To Different Business Sizes

Don’t be discouraged if you can’t find a Chinese supplier that meets your minimum order requirements. Every successful company has a starting point.

It is important to realize that there are a variety of suppliers that can satisfy different types of customers. You must figure out in advance whether you and your supplier match. So, you and the suppliers don’t waste any time in the beginning.

 

For example, we are still considered a small company for our wedding supply store when it comes to our purchasing volume, so we don’t need to contact a large Chinese manufacturer directly.

 

When I contact a supplier for the first time, I always start with email and then transition to Skype or WeChat. If possible, I will try to arrange a face-to-face meeting by travelling to China (recommended but not required).

When I send emails, I don’t use standard letters or templates because I deliberately write personal emails.

Remember, you are dealing with real people, and you are trying to develop a relationship. It would help if you tried to treat all your suppliers like old friends or colleagues.

 

 

How To Get A Chinese Suppliers Attention

In the beginning, We encountered many problems when contacting the suppliers because we did not understand their needs.

To succeed, you must put yourself in their shoes of.

If you deal with wholesalers or distributors, their first need is to get paid for the product.

If you are dealing with dropshipper, their first need is to work with a store that can drive continuous sales. Setting up and maintaining a dropshipping account requires a larger upfront commitment, and the hassle of shipping a single order must be worth their time.

If you are dealing with a Chinese supplier, their factory capacity is limited, so they need to work with people who can provide stable sales in higher numbers.

Before you contact any supplier, make sure you have a suitable strategy to meet each others’ needs.

Don’t forget. Your suppliers are also working hard to make money. The best arrangement is that you and your supplier can make money and have common interests.

When we first started, we tried to get the lowest possible price from our suppliers. But we found that this strategy usually irritates them. Once we become more creative in trading, our relationship with suppliers becomes closer.

For example, instead of trying to negotiate an absolute lowest price in advance, we agreed to a pricing structure based on sales volume.

 

Your first impression of the supplier will determine everything. The following are some of the mistakes I have seen that new entrepreneurs make when contacting suppliers for the first time.

 

 

3 Mistakes for First Reach Out to Chinese Suppliers

 

Mistake 1: You lack self-confidence and give the impression that you are a novice

Remember when I told you that mature suppliers tend to select customers very carefully? In order to get the Chinaattention, you sometimes have to be stronger and more confident than you really are.

To illustrate my point, I want to show you a letter a reader wrote to their first supplier/shipper.

 

My name is Vivienne and I am a brand new entrepreneur, so please forgive my ignorance. I want to start an online business selling baby products. Can you give me a price list of your products and describe your delivery process? Here are some of my questions…

Can I send you an order by email and then you send it to my customer?

Is my contact information on the packing slip?

Can you provide an order summary to confirm the order?

Will you charge a delivery fee?

If I start selling in bulk, will you give me a discount?

Is there a restocking fee? How are returns handled?

How long will it take me to return a potential order?

When a customer wants to return an item, do they contact me directly or you?

Do I charge the order fee immediately, or pay after a period of time?

How long does it take for order processing/shipping?

Do you ship by DHL, FEDEX, UPS and USPS? Do you provide tracking numbers?

Do you ship internationally? If the goods are returned to the shipper, how do you deal with the delivery exception?

Do you provide order and shipment confirmation and tracking numbers?

Sorry for asking so many questions. 

Thanks in advance.

 

As expected, no response was received to this email. Can you spot the problem? First of all, you should never say that you are a “new entrepreneur”.

Think so. If you were a wholesaler, would you be willing to waste your time on someone who has no idea what you are doing? Absolutely not. When you deal with a new supplier, you must be confident.

Tell them what you want, do your research beforehand, and don’t ask stupid questions. You don’t have to be proud, but you should behave as if you have done something like this before. The key is to be specific, concise and confident.

 

Mistake 2: You said too much in the first email

In a way, your first contact with a supplier is like your first date. So, You don’t want to overwhelm them with questions, and you do not want to appear too desperate or too eager.

You just want to get to know the supplier and see if they have something you want to sell. Most dealers are very busy, so you should respect their time.

In the sample email above, the reader asked too many irrelevant questions from the beginning. Although the logistics of how the business is carried out is very important, the key to the initial interaction is to find out whether they have got what you need.

The following are some typical requests I made in the first email:

 

Specific

product information

MOQ

Pricing

Shipping

and delivery time

Do they provide samples?

 

Once I get an initial response from the supplier, I will start asking some logistics-related questions to see if they are suitable for me.

 

Mistake 3: you do not know what you are looking for

Puzzled!

The more vague you are, the less likely you are to get a response. In the email above, Vivian mentioned that she was interested in some “baby products”, but she did not specify.

If I were a supplier, this would be a direct red flag. What is she looking for? Is she investigating what we sell? Does she really want to take my product? Does she really know what she wants?

When contacting the supplier for the first time, it helps to clarify what you are looking for. Being specific shows the supplier that you have done your homework, that you know what you want, and that you are serious about selling their products.

On the other hand, if you express ambiguity or indecision, you will not be considered a serious potential customer, and your email may be ignored.

 

First time Contact Chinese Suppliers Sample script 

Below is a sample script that I like to use when I first contact a supplier.

 

Hi “supplier name”, 

My name is xxx. I am a buyer in “your company” and a buyer in a store in “your country” that sells “products that your company wants to sell”. We are interested in many products you offer. Specifically,

I want to get the price and availability of the following items

“List items… if available, provide photos”

“List items… if available, provide photos”

If you can send us more information as well as your product catalog, production lead time and minimum order quantity, we would be very grateful.

Thank you!

“your name”

 `

Remember, suppliers are ordinary people. If you feel scared at the thought of contacting your supplier. You need to remember that suppliers are just people who run a business like you.

It all boils down to establishing good business relationships and finding suitable candidates. If a supplier is rude or does not give you time, then they are not suitable for your small business.

If you lie about the size of the company in order to enter the door of the company, the truth will eventually come to light when you cannot afford the minimum purchase fee. I can guarantee that once you find a suitable supplier, you will not be afraid.

 

As part of operating an online store, we always receive requests from merchants who want to buy our products wholesale or in bulk.

Most importantly, I prefer to work with frank and frank people. You want to establish a business relationship here, not just buy products.

 You need to know that you can rely on your suppliers to deliver the goods, and they need to ensure that you will pay on time or no cash flow issues in the future. The rest will be resolved by itself.

 Keep this in mind that do not waste time contacting anyone until you have a suitable plan because the first impression is important. If you mess up the initial connection, you may lose the opportunity forever.

 

 

Start By Practicing On Some Suppliers You Don’t Care About

When you look at the list of suppliers, you need to realize that most of these  Chinese wholesale suppliers will not work with you for one reason or another.

Before you start contacting them, you need to prioritize your suppliers list first. For example, Which suppliers do you absolutely want, and which ones you do not care too much about?

China wholesale website supplier

Especially if this is your first time purchasing a product, you should do some exercises with suppliers that you do not really care about until you have perfected your communication skills.

 I remember when I first contacted our China/ Asian supplier, I sounded like a clumsy idiot. It was via email! I do not know what the correct procedure is or even how to pay overseas. I am also not familiar with the terminology of transporting and importing goods from abroad.

Anyway, before I fully understood the terminology, I went through several iterations and lost some suppliers. My ignorance has driven away some key suppliers that I really want to work with. Do not make the same mistake again!

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