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Our economy is in trouble. Should we drop all of our inventions and wait for better days? No! Read more below to find out why.
We also have another taste of Sourcing Smarts on how to negotiate with potential manufacturers.
Enjoy! |
With Our Economy in Trouble, What Can an Inventor Do?
Retail sales are down, people are losing their jobs, and things will
probably get worse before they get better. Is now really a good time
to bring your product to market? Yes! Now might be an even better
time to bring your product to market than when the economy was in good
shape. We'll discuss why and how you can capitalize on this
opportunity. Read on... |
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A Taste of
Sourcing Smarts
Taken from Chapter 4 of "Sourcing
Smarts: Keeping it Simple with China Sourcing and Manufacturing"
by Edie Tolchin, Don Debelak and Eric Debelak,
this
installment talks about negotiating with the "winning" factory whom you've
chosen to work with.
At
this point, you may have found that none of your potential manufacturers will
work out. Don't worry, just put together
another list of manufacturers and start again.
There are thousands of factories in China so you still have plenty of
options left. If you still have at least
one potential manufacturer left, you need tomake your final choice and start
the negotiating process.
Your
Chinese manufacturer will almost always expect you to negotiate on the final
price of the product and shipping terms.
Depending on your background and where you are from in the U.S., this may
not be easy for you and you may want to enlist the help of someone who has some
negotiating experience.
You
can start the price negotiation process by simply sending a counter-bid. Keep it realistic, since if you really are
interested in the prospective supplier, you do not want to be insulting.
Another
way to open negotiations is to suggest your desired price in your introduction
letter when you submit your prototypes.
For example, you might write: "I am expecting to pay for 5,000 pieces at
US$2.50 per piece", which should normally be a few cents lower than what you'd
expect to pay. This way, if the supplier
counters with a bid of US$2.60 per piece, it may still be within your
acceptable price range.
Most
China factories quote
payment / shipping terms either as "FOB China"
pricing, which WILL NOT include ocean freight and marine insurance, or "CIF USA" port
pricing, which WILL include freight and insurance. This is also negotiable. I typically prefer "CIF USA" port pricing because the supplier makes all
the arrangements, frequently via their freight forwarder and steamship company
in China,
and issues a marine insurance policy as well.
All you will have to do, when the shipment arrives in the USA, is have
your (USA) customs broker clear your shipment for you, prepay import duties,
and arrange transportation from the port to your inland delivery destination.
With "FOB China" pricing, however, you and/or your freight forwarder would have to
make all arrangements to book space with a steamship company in China, obtain
marine insurance, etc., all of which can be a bit more costly if arranged from
the USA instead of in China. Your
supplier would then just be responsible for shipping the cargo to the appointed
vessel at the Chinese port, and the rest is your responsibility. There will be more on this in Chapter 5.
Stay tuned for more of a taste of "Sourcing Smarts" in
our next newsletter, where we will be discussing PAYMENT TERMS.
Or,
you can contact Edie Tolchin of EGT Global Trading directly at EGT@warwick.net, www.egtglobaltrading.com, or at
845-321-2362.
To purchase
"Sourcing Smarts: Keeping it Simple with China Sourcing and Manufacturing"
by Edie Tolchin, Don Debelak and Eric Debelak, go to www.egtglobaltrading.com, www.sourcingsmarts.com, or www.amazon.com. |
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Are you ready to get
your product or idea on national and international
television?
I'm happy to
announce a unique opportunity for a very select few individuals with innovative
inventions and products. Nick Romer, award winning inventor and best
selling author of "Make Millions Selling on QVC" is sponsoring a two day event
designed to accelerate you and your product's path to
success.
Attendees will
discover the insider secrets to getting their products on the top home shopping
channels and will have a chance to connect with top industry experts looking for
great products, and product developers interested in long-term success.
If you think you
have what it takes and you've got a fantastic product or idea, then you'll want
to visit the following page for more information:
http://www.millionsonq.com
Edie Tolchin, co-author of "Sourcing Smarts: Keeping It Simple With China Sourcing and Manufacturing" will be presenting a workshop at Nick Romer's "Millions on Q" bootcamp the weekend of 1/31-2/1/09 in New Jersey. Contact Edie Tolchin, EGT Global
Trading at EGT@warwick.net or via phone at 845-321-2362 for further information.
The dates of the
event are January 31 - Feb 1, 2009 |
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