Before You Take a Trip to China Looking For a Manufacturer...

• by Jason Chinn
 

Before You Take a Trip to China Looking for a Manufacturer...

Before You Take a Trip to China Looking for a Manufacturer...
...there are a few things you need to know.

China is a hotspot for sourcing cost-effective manufacturers, and so many entrepreneurs seek out a factory there to bring their products to life. But as they often find, there's a lot to navigate.

Take Andrew Moore, the owner of Felony Case, who started off hand-making his unique iPhone cases before travelling to China to find a manufacturer.

In this episode of Shopify Masters, he'll share how to plan your trip to China to find manufacturers and make the best use of your time—including what time of year to go and how to work with a "fixer" in China.

Buyer Beware: Watch Out for Dropship Middlemen

Welcome to The Wholesale Bible! 🛒

Today's post explores [BUYER BEWARE]—a useful guide for wholesalers, resellers, and savvy online entrepreneurs.

Buyer Beware: Watch Out for Dropship Middlemen

Ever been scrolling through Facebook Marketplace or eBay, found what looks like the perfect gadget or a unique gift, and clicked 'Buy Now'? You pay a reasonable £25, the seller's location says they're just down the road in Cardiff or Bristol, but then the delivery estimate is... four weeks?

If this sounds familiar, you've likely encountered a dropship middleman.

Here in Maesteg, like everywhere else across the UK, we're all looking for a good deal online. But a growing trend is making it harder to know if you're getting value for your money or simply being overcharged. It's time to talk about dropshipping and how you can become a savvier shopper.

What Exactly is a Dropship Middleman?

In simple terms, a dropship middleman is a seller who lists products they don't actually own or have in stock.

Here's how their business model works:

1. They find a cheap product on a huge online marketplace like AliExpress, Temu, or Shein (let's say a novelty lamp for £5).
2. They copy the photos and description, often making them sound more appealing.
3. They list that same lamp on a platform you trust, like eBay, Amazon, Etsy, or even their own slick-looking website, but for a much higher price (e.g., £25).
4. When you buy it from them, they take your £25, use £5 of it to order the lamp from the original supplier in China, and have it shipped directly to your address.
5. They pocket the £20 difference without ever touching, seeing, or quality-checking the product.

While not illegal, this practice creates several problems for you, the buyer.

The Red Flags: Why You Need to Be Cautious

1. Hugely Inflated Prices This is the biggest issue. You're paying a massive markup for an item you could have bought yourself for a fraction of the price. That £20 profit the middleman made came directly out of your pocket for zero added value.

2. Deceptively Long Shipping Times The seller might be registered in the UK, but the product is beginning a long journey from a warehouse on the other side of the world. This is why a "UK seller" can have a delivery estimate of 3-6 weeks. They are banking on you not noticing this detail until after you've paid.

3. Customer Service Nightmares What if the item is broken, not as described, or never arrives? The middleman has no direct control. When you complain to them, they have to complain to their supplier. This creates huge delays and communication black holes, making refunds and returns incredibly frustrating.

4. Zero Quality Control Because the seller never handles the product, they have no idea if it's good quality, if the colours are correct, or if it even works properly. They are relying on the same stock photos as you are.

How to Spot and Avoid the Middlemen

You don't have to fall for it. Arm yourself with these simple checks before you part with your cash.

⭐ The Ultimate Tool: Reverse Image Search This is your secret weapon.

• On a computer, right-click the product image and select "Search image with Google".
• On a phone, press and hold the image and see if a "Search with Google Lens" option appears.

Google will show you everywhere that image appears online. You'll often immediately see the same product on sites like AliExpress or Temu for a tiny fraction of the price.

⭐ Scrutinise Delivery Times This is the easiest giveaway. If the seller's profile says "United Kingdom" but the delivery estimate is more than a week, be highly suspicious. A genuine UK-based seller with stock on hand can usually get a parcel to you within a few days.

⭐ Check the Seller's Other Items Click on the seller's profile and look at what else they're selling. Is it a random, unconnected collection of trendy gadgets, fast fashion, and homeware? This is a classic sign of a dropshipper who is just listing popular items. A genuine specialist will usually sell related products in a specific niche.

⭐ Read Between the Lines of the Description Look out for generic, badly translated, or overly enthusiastic descriptions full of buzzwords but lacking real detail. Vague phrases like "high-quality materials" or "stunning design" without specifics are a red flag.

The Takeaway

Online shopping is a fantastic way to find things we love. The goal isn't to stop buying online, but to do it smartly. Before you get swept up in the excitement of a purchase, take just 30 seconds to do a quick reverse image search or check the delivery details.

By doing so, you're not only saving yourself money but also ensuring you're buying from more transparent and accountable sellers.

Happy (and smart) shopping!

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Liquidation vs. Wholesale: What’s the Difference?

PART 1

Posted on August 18, 2016 by Melissa Gieringer

There is often confusion on how liquidation and wholesale differ (or if they do at all). In fact, there is a huge difference between the two. Read on for overview of both.

Liquidation typically means an organization is trying to turn excess, overstock, or obsolete assets into cash, quickly. For retailers, obsolete merchandise costs money because 1) the goods depreciate with age, 2) they take up space in the warehouse, and 3) they tie up capital. Most retailers will end up selling – aka liquidating – 95 percent of this excess inventory on the secondary market to free up capital and warehouse space; it will be sold at a loss.

Historically, large retailers and manufacturers have sold this liquidation inventory in bulk through negotiated transactions with a handful of buyers. These sales are generally at prices well below retail MSRP. Over the past few years however, a shift has taken place: many retailers are bypassing traditional liquidation methods and incorporating technology-based programs for obsolete inventory into their overall business strategy. This includes working with B-Stock to launch customized B2B online auction marketplaces that connect returned and excess merchandise directly to business buyers; the result is a level playing field for all buyers, big and small, to compete for the inventory. Essentially liquidation buyers have access to highly discounted inventory that they were previously never able to buy without middleman involvement. What’s more, the inventory is generally listed at a fraction of MSRP.

Now, wholesale. Wholesale is the sale of goods and merchandise to resellers and businesses. The wholesale price is usually fixed and the amount of product can vary substantially. The goods are usually sold – by the wholesaler – in bulk quantities with the intention of being retailed/sold by the purchaser. Something else to note: true wholesaling is generally not available to the standard consumer.

Wholesalers frequently purchase large liquidation bulk lots from large liquidators, break those lots apart, and then repack and redistribute them in smaller lots to smaller retailers and resellers. Often by the time the smaller retailer or reseller gets it, the merchandise has been through multiple middlemen and price mark ups.

Part 2 Coming Soon...