Importing cheap products from China and selling them at a huge markup is slowly becoming one of the internet’s next ‘get rich quick online’ business ideas. Its increasing popularity may be how you found yourself at this page! Importing can definitely be a great business to get into so I’ll give you the good, the bad, and also some background into how I got started.
How I Got Started
In the late 90’s while I was a teenager, I started helping a family friend with his web design and marketing for a particular product he was importing from China. I slowly ended up managing everything to do with his product, including web design, customer service, and accounting. Like every good employee, I slowly began to think “Crap, what do I need my boss for?”. So when I was 23 and enrolled at university, I broke off on my own and started my own company importing products from China.
Like many entrepreneurs, this wasn’t my first adventure into entrepreneurism which ranged from selling homework answers in Grade 4 all the way to selling boot-legged Playstation 1 Video Games in 1997 (after purchasing a CD Burner for over $900 after a big Bingo win at age 13!). But importing from China was my first real business.
Today, my company generates in excess of $1million a year in revenue and we have 3 full time staff.
So Why Should YOU Start an Importing Company?
Here’s a list of some other good reasons to start a business importing from China:
- Potential to make a lot of money
- You can start small and with limited money but also rapidly scale the business
- Live a lifestyle that lets you travel to a country that is spectacular to visit as a traveler
- Start a business importing and developing products you love and have a passion for
- An opportunity to live a lifestyle void of 40 hour work weeks
Importing from China lets you experience one of the most amazing countries and cultures in the world
Accepting a general rule of thumb to sell your imported products for at least 2x their cost, that means you are theoretically doubling your money (at least). This means potentially big profit. If you choose to have your product fulfilled by a third party fulfillment company such as Amazon FBA, then you can in fact make your company essentially an online business. But more on the question of whether importing is an online business later.
If you have a hobby you’re deeply interested in, say Horse Back Riding, and you import products related to that niche, your work days will inherently become infinitely easier dealing with people and product related to that hobby.
But what really separates importing from China from all of the other “Start Your Own Business” promises is that importing from China lets you experience one of the most amazing countries and cultures in the world. Even if you never leave your living room laptop, communicating with Suppliers thousands of miles away in Shenzhen gives you an opportunity to figuratively travel abroad and experience Chinese culture for all it’s worth (good and bad). Grabbing a 3-item meal at the Manchu Wok can’t compare!
So Why Should YOU NOT Start an Importing Company?
As good as importing is, there are several reasons not to get into it (like any good business):
- Requires cash to buy product
- You are holding a physical product and therefore you have all of the risks that go with that
- Dealing with a different business culture can be frustrating and hard
If you’re looking for an “Online Business” to start, cash can become the most major obstacle. Unlike other businesses like blogging or affiliate marketing and the like, you need cash to buy product. The amount of cash required can be small, potentially only a few hundred dollars, but nonetheless it is required. Buying product also means that you absorb all of the risk that go with that product. If you receive crappy products, your products get stolen, etc. etc. the onus is on you, unlike other business models such as drop shipping, where you never touch the product.
Finally, doing business with China is exciting and refreshing but it can also be extremely frustrating, if only because of cultural differences. The first time you experience the the Chinese’ notorious reputation for avoiding the word ‘no’ (even when they mean ‘no’) you’ll know what I mean.
Work from Home? Yes. Avoid 9-5? Yes.
For the first 6 years of running my import company, I did it from my 1 bedroom apartment, largely through the help of third party fulfillment companies. You should do this too when first starting up.
Most of my company’s sales come through the internet, which means there’s not a demand to be open 9-5, servicing customers in person. And in fact, many of our sales do come while I am sleeping (and there is something great about logging into your email and seeing dozens of orders come in while you were sleeping). It’s also a business that affords me a lot of flexibility to work where I want.
But, Working from Home at Odd Hours Doesn’t Mean Not Working
There’s a popular catch word in the internet world called Passive Income. If passive income is working hard to create a business that runs 24 hours a day, even while you’re asleep, then starting an import business is passive income.
However, passive income does not mean not having to work. It simply means working hard during the times you pick and the places you pick. My import business allowed me the opportunity to visit the internet-blackhole that is North Korea without any interruption in the sales. However, that same business demanded that I actually smuggle a laptop computer into the North Korea so I could check my email the second I left the country and had internet access.
How Much Money Do You Need to Start Your Import Business?
This is one of the most common questions I get asked – how much money do I need to start an importing business?
Here’s the short answer: You need about $2000 to start your importing business.
Can you start with less? Absolutely – I know many people who have started with around $500. However, $2000, in my experience, is a good amount of money to cover the cost of your first order, your second order, shipping, marketing fees (re: Amazon), and other miscellaneous expenses.