Do you want to learn how to start a small-scale importing company in Africa? This post is jam-packed with useful information for you!
The globe is certainly becoming a smaller place. Who would have thought that ordinary people like you and me (who don't have a large bank account) would now be able to import goods directly from foreign suppliers?
Before I started looking into the small-scale business idea that I am about to share with you, I assumed that universal exchange was reserved for the government and wealthy major importers who had good relationships with manufacturers and suppliers all over the world.
After all is said and done, no more.
This essay explains how small-scale representatives and business visionaries in Africa may have a piece of the import market with minimum financial investment. With the knowledge available right now, you may also import things at a low cost and sell them for a much larger profit.
When you've completed reading this article, you'll know everything you need to know to become an importer and global representative!
How the importing industry works
Before we get into the meat of this essay, it's critical that we understand the fundamentals of buying and selling.
How does the 'buy and sell' company make money?
The idea is simple: you buy something (say, wristwatches) at a cheap cost and sell it at a higher one to earn a profit.
There are essentially two options for increasing the magnitude of the benefit you can make. You may either find a way/place to buy wristwatches at a lesser cost or look for customers who will buy them at a higher cost.
This is how everyone in the retail (buy and sell) industry generates money (benefit). Buy low and sell high. It's elementary arithmetic!
We'll use a brief illustration to ensure you understand the opportunity we're about to bring to you:
Let us suppose you are the owner of a small business that offers custom-made wristwatches. You have a little shop where you display all of your magnificent wristwatches for customers to admire and perhaps purchase.
Because you can only afford to stock a few hundred wrist watches at a time, you have no choice but to buy from large importers who, due to their vast wealth, can acquire a large number of watches from distant manufacturers at extremely cheap discount rates.
Despite the fact that you would want to take advantage of these reduced discount charges (which would extend your benefits), you lack the money that the major importers do. Even if you could buy directly from the outside item makers, the cost would be too high.
Most manufacturers and suppliers have a Minimum Order Quantity (MOQ) requirement. The minimum order quantity (MOQ) is the minimum number of products that a supplier will provide you in order to provide you with a favorable benefit. This is why they like to give to large importers who buy large quantities (compartment piles) of their products.
Because you can only afford a couple hundred watches, the great majority of the large international vendors will refuse to deal with you.
As a result, you're stuck with the massive imports. The profit you may derive from your firm is limited by the value they choose to place on imported goods.
The table below demonstrates how large importers act as "mediators" between you and the watchmaker, reducing your company's profit capacity.
Fortunately, things have changed.
The internet has removed the barriers that used to prevent access to producers located thousands of kilometers distant. Improvements in transportation and coordination now allow private businesses with limited financial flow to import smaller quantities of product at reduced delivery costs.
Finally, small and medium-sized businesses and independent contractors may enjoy the same low discount rates that large importers have enjoyed for a long time.
The diagram beneath depicts how this new business opportunity eliminates the middleman and enables you to purchase lawfully from faraway manufacturers at reduced rates, allowing you to earn a larger profit.
Something you should know before we begin
Many of the products and services you are already familiar with are manufactured or located in China.
Despite the fact that we will also examine products from the United States and Europe, the suggestions right now are increasingly about acquiring items from Chinese manufacturers and suppliers. The question that is most likely on your mind right now is, "Why China?" Excellent question.
I'll disclose to you why...…. LET'S CONTINUE;
Most items on the planet today are made in Asia, particularly China, as you may already know (or have no idea). Toys, household appliances, decorations, PCs, workstations, cell phones, and even Apple's iPads are manufactured in China.
Let's try to confirm this by performing a quick scan of the things in your immediate vicinity. You'd be surprised to learn that almost four out of every five items in your immediate vicinity were manufactured in China.
I'd prefer to utilize myself for instance.
The computer I'm using to type these lines is a Chinese-made HP Notebook. My clothing, my headphones, my wrist watch, and my iPad are all produced in China. My cell phone is most certainly the most valuable item 'Amassed in Brazil.' So the 4 out of 5 hypothesis is correct in my case!
Aside from nutrition goods, China is the major supplier of all of the popular and fast-moving consumer items you're familiar with.
Because of its low labor and production costs, China is possibly the world's least costly producer. As a result, many of the well-known companies (Apple, HP, Louis Vuitton, and so on) manufacture their goods in China using manufacturing lines and temporary employees.
To ensure that the quality of their products is not compromised, the United States and European nations establish highly stringent criteria, which the Chinese generally meet.
For what reason am I exposing this to you all? This is because many Africans have come to believe that Chinese goods are of poor quality.
While this may be true, I do not believe we should accuse the Chinese. Overall, China manufactures a substantial quantity of high-quality products in the United States and Europe.
What do you have to start with?
To join the new and growing coalition of independent business owners who will now be allowed to legally import products at cheap discount rates from overseas providers and manufacturers, you will just need the following:
- A PC or cell phone with access to the web;
- A substantial email address
- A substantial and discernible home or office address in your nation where the things you request will be dispatched to.
- A minimal expenditure in your ledger. (We'll discuss this somewhat later right now)
That is all you require, you are accurate!
This indicates that you can look for, request, and import all of the things you need to sell from the comfort of your bed, breakfast table, or while perched on a conveyance (by means of your cell phone).
Please keep in mind that a P.O Box or PMB (Private Mail Bag) does not qualify as a real and identifiable location.
You should be excited to get started with your new and potential small-scale import business. However, before you start shopping and requesting things on your PC or cell phone, let us guide you through eight of the most often asked questions.
When you're done reading them, you'll know the greatest and most trusted places to buy from, how to confirm the quality of products, the payment method, and a few other things.
We should look into it!
#1 – Where would you be best served to make your purchase?
The following websites are our top picks for online shopping malls that sell products at affordable prices:
Aliexpress.com
- How to Start a Small Import Business with Aliexpress.com has emerged as the primary destination for small-scale importers seeking low-cost products from China.
Aliexpress is one of the Alibaba Group's subsidiaries, which controls web-based trading in China.
Truth be told, in 2012, Alibaba's gateways took care of offers of up to 1.1 trillion Yuan ($170 billion), more than its rivals (eBay and Amazon.com consolidated). The Alibaba Group is assessed to be worth between $55 billion to more than $120 billion.
The Alibaba Group propelled Aliexpress in 2010 as an online retail administration made up of for the most part little merchants offering items to online purchasers. It has in excess of 20 significant item classes and offers to enrolled clients and purchasers in excess of 220 nations around the globe. You can visit its landing page at www.aliexpress.com
DHgate.com
How to Start a Small Import Business with 6DHgate.com is a business-to-business (B2B) web-based business platform that connects China-based small and medium enterprises with customers worldwide.
The website is a rapid swapping commercial hub where customers may arrange Chinese-made products directly through the website. The group has been in operation since 2004 and is backed by financial experts KPCB, JAFCO, and Warburg Pincus.
iPmart.com
How to Start a Small Import Business 7 iPmart.com (founded in 2001) is a fantastic bargain showcase that stocks products from China, the United States, and Malaysia. Unlike Aliexpress.com and DHgate.com, which provide a wide range of products, iPmart.com focuses on electronic devices such as cell phones and game consoles, as well as their accessories and extras. If you're looking for cutting-edge products, iPmart.com is the place to go. You may find its website at www.ipmart.com.
To begin shopping and making requests on any of these sites, you must first sign up to become a member. It is usually straightforward to join or enlist.
By clicking on the 'Join Free' or 'Register' link in the top left/right corner of the landing page, you will be sent to an enrollment page where you must complete a brief structure. Normally, all that is necessary is a name, a valid email address, and a password. You can join or enlist using your Facebook account if you want.
When your enrollment is complete, you may start shopping and adding items to your vehicle. When you are ready to proceed, you will be taken to the Payment page. This brings us to the next significant advancement.
2-#Payment methods
Payment was one of the main reasons that small firms found it difficult to buy directly from international manufacturers and suppliers.
Banks were required to issue a Letter of Credit or a Bank Guarantee, which was often a lengthy and complex process.
All of the websites mentioned above accept payment through a variety of methods nowadays, thanks to simple online payment systems. You can pay with a credit/debit card or a simple bank transfer. Yes, you may use the same card you use at ATMs to make purchases on these websites.
Simply ensure that your bank account is properly filled to allow you to make payments. Quick and simple! There will be no banks or lengthy procedures!
I've produced a brief training video to assist you with this problem if you don't know how to use your ATM, Credit, or Debit card to make online payments. Enjoy!
#3 – What if you get scammed?
For a long time, tricks and misrepresentation have been a big concern in web-based exchanges and web-based commerce.
Consider the possibility that you receive the products and they are fake or not exactly as the provider described.
Consider the following scenario: you pay for the products, but they are never shipped and delivered to you.
How can you ensure that you receive the EXACT items you paid for without being duped?
Great and important inquiries!
Every one of the sites we've recommended to you right now has some sort of 'purchaser assurance' system integrated into the payment method.
This method, sometimes known as 'Escrow,' is comparable to the role that banks have played in the import sector and worldwide exchange for quite some time. It is simple to understand how escrow or buyer assurance works. Instead of paying the seller directly, Aliexpress, DHgate, and iPmart hold your payment until you receive the products you ordered and confirm that they are not phony/damaged.
The image below is an example of an escrow framework used by DHgate.com. It's a simple five-step process that ensures the buyer is never duped and gets exactly what he or she pays for..
Websites such as Aliexpress.com and DHgate.com provide refunds and will reimburse your money if you are dissatisfied with the products you get. All of this is done to reduce the possibility/fear that you may lose your money.
We cannot guarantee that the process is completely risk-free. Regardless, we can state that what you fear the most (being scammed) is extremely unlikely to occur.
#4 – How would I be able to discover top notch items and solid dealers?
This is perhaps the most common fear that people have when purchasing things from China.
Unlike the stringent quality and security standards that protect customers in the United States and Europe, African businesses are helpless against low-quality goods. So, how can you be confident that you're buying high-quality products from a reputable vendor?
This is when the quality of client criticism assessments comes into play.
This rating has an impact on the overall rating of that vendor. If the vendor consistently delivers as promised, he or she usually receives increasingly favorable feedback from satisfied clients. On the other hand, if the vendor's administration is poor, dissatisfied customers will gladly provide him/her bad feedback, lowering the dealer's appraisal.
A majority of these ratings are based on a scale of 0 to 100 percent or 1 (low) to 5 (high) stars. As a result, when you discover an item you're interested in, we strongly advise you to look into the vendor's critique rating.
We advise you to only select vendors who have an usual favorable criticism rating of 90% or 4 or above.
Regardless, this standard isn't ultimate. You should make an attempt to read the real opinions and suggestions from previous buyers. Reading them will provide you with important bits of information and tidbits of data regarding the nature of the vendor's goods, early or late conveyances, and so on.
We also strongly advise you to spend as much time as necessary reading the item descriptions/subtleties, dealer certifications, and delivery terms, which are generally found at the bottom of each item page. You must ensure that the item you are purchasing contains the features you are looking for. Remember that what you pay for is what you receive.
#5 – How will the items be conveyed to you?
A few items on Aliexpress.com and DHgate.com include a 'Free Shipping' administration to a variety of countries around the world. China Mail Air Post or Hong Kong Mail administrations frequently convey free sending.
While the free shipping option is attractive, it usually takes the greatest time to have your product delivered to you; typically between 15 and 60 days, depending on the item and your location.
Regardless of a longer conveyance duration, it may be tough to track the whereabouts of your package throughout the conveyance method. If security and prompt conveyance are not real concerns for you, the money saved through free shipping can vastly enlarge the profit capability of the things you import when you sell them.
DHL, EMS, and Fedex are three more fundamental options for delivery on Aliexpress.com, DHgate.com, and iPmart.
Despite the fact that these are far more expensive options, they often get your things to you in less time and allow you to track them as they make their way to you. However, unlike the free sending option, employing these alternatives is likely to lessen the benefit capability of the products you request.
Tip: Whether you pick a free transporting option or a faster conveyance administration for your request, we recommend that you include your mobile phone number in the delivery address you provide.
In general, you will receive a call from your local post office or a nearby DHL/Fedex location to come pick up your items. Counting a phone number might be the difference between a delivered and a lost package.
#6 – What are the most well-known and popular items?
The previously mentioned websites have a big percentage of the well-known and hot-selling products you can consider. Some of these things are clothing frill (for both individuals), consumer gear (such as cameras and other sorts of gadgets), and mobile phones and adornments (earphones, chargers, batteries and so on).
How to begin a little import business
More than 60% of Africa's one billion people are under the age of 30. A large portion of this young population is interested in design frills and technology gadgets. Furthermore, our mainland is now the world's second-largest cell phone market after Asia. As a result, Africa has a lucrative commercial sector for a wide range of portable decorations.
There is no hard and fast rule when it comes to locating the greatest goods to import and sell in your local market. You must pay close attention to market trends in your area. You must have an eye for the types of things that are popular in your area/country.
Import an example of an item first and discover what number of your companions might be intrigued. Pay special mind to items that as of now exist in your market that you can import and sell at less expensive costs. There's a great deal of potential right now you can locate the correct items for your clients at the correct costs.
#7 – How will I discover purchasers for the items I import?
Interesting question.
If you already have (or can find) a small shop for the things you import, that would be fantastic. Despite the fact that this is the most recognized and traditional technique available, it works. Customers that are interested in your product will walk into your store and perhaps make a purchase. You will most likely have a significant advantage over any competitors that sell identical products to you.
Because you import directly from foreign suppliers, you may sell your products at far lower prices than they might imagine. It's your cherished recipe!
There is trust for those business visionaries who desire nothing more than to start this business but don't have a real store or shop (or can't afford one). The internet has altered the entire selling process, making it much easier to sell items to both people you know and complete strangers.
It is currently possible for anyone to build up an online store/look for nothing by using a well-known internet based living arrange like Facebook! Simply transfer photographs of the fascinating items you've recently imported and invite your buddies (and their companions) to come view. If they like the item and the price, they will contact you to purchase it!
In previous post, we discussed the intricacies and step-by-step method for creating a Facebook Page for your business, as well as how you may use it to attract and gain clients for your new venture.
Making a Facebook Page that displays the goods you import is one of the simplest and least expensive ways to launch your own online store! You should make the time to read the entire essay here.
#8 – How much capital do I have to begin?
As you can notice if you visit any of the sites we recommended, many of the products on sale are quite low-cost. Not all of them, but a substantial percentage of them sell at modest prices. Actually, the more units of an item you buy, the cheaper the price you pay; this is the benefit of buying in bulk.
Furthermore, keep in mind that the lesser the value you spend, the greater the benefits you may reap.
You don't have to spend every last penny or go into debt to start this business. Start small, like we always say here at Smallstarter!
Begin with things that are inexpensive but popular in your neighborhood or country. Use this to put your company idea to the test and build your confidence.
If you can find the right buyers to sell to, you may make more than 50 to 100 percent net profits on the majority of the products you import. As you gain experience in your new import firm, you will be able to assess various goods that are somewhat more expensive.
Tip:
Never allow your enthusiasm for this business to reveal indications of improvement in you. Avoid the temptation to contribute a large sum of money when you first start, unless you already have ready customers for your products.
Begin with a small scale and gradually progress. This method may take a little longer, but it is less dangerous and helps you gain expertise and confidence.
You now understand how to start a small-scale importing business in Africa. When are you going to begin?
As previously said, the business open doors for private enterprises and business people like you to import legally from foreign manufacturers and suppliers did not previously exist. It is now feasible partially because major businesses all around the world have started to see Africa as a strong and developing financial powerhouse.
If fair inferior nations like China are to continue developing, they should give a bigger quantity of their products to business sectors like Africa, which have a large and expanding usage. Africa is now one of the fastest expanding marketplaces for consumer goods, and the Chinese are doing everything they can to deeply penetrate our market.
One way they are accomplishing this is by removing intermediaries from the import process, making the payment process easier and faster, and lowering the risk of fraud, misrepresentation, and poor product quality.
The hardened steel pocket watch to the right is an example of a product I discovered and purchased (for approximately $6) on Aliexpress.com. I opted to use the dealer's free shipping option, and the item will be delivered by China Mail Air Post.
Best wishes for your success!