Anyone importing from china and ebaying? - Need some advice.

TrickyWicky

Hi all

I've bought quite a few bits from ebay but only ever sold two things and both of those were years ago.

Now like most people, I am struggling for cash. My reserves are gradually running dry and I'm thinking its about time I did something about selling online and gradually building up an online brand

Now I've found an item that I'd like to import and sell from china. I'm hoping some of you can give me your views on the idea. I will use +/- to mean "give or take".

On ebay at present, they sell them direct from china for around £110 on ebay.com and £135 on .co.uk (down from £150 a few days ago but still up from £120 a couple of weeks ago). Now I figure they're making about £20 - 30 profit after the shipping and manufacturing costs.

If I import from them, each unit is around $112USD (£65 - 70) per item and the minimum order is 8 units at a total of $896 (£582 +/-). Now one unit is $38 to send so I simply multiplied that by 8 to give me a shipping cost of $308 but in reality that may be cheaper. The running total here is $1200 (£780 +/-)

Now this is the bit I know nothing about. VAT / import duty / tax / other extortion raquets run by the treasury. How does that work and what charges am I looking at? I have no clue so I went with 20% which is £155 bringing my order total for 8 units up to £935 +/-

Now dividing that by the 8 units and thats £117 per unit just to cover costs. Ok, it's UK stock so I'll have the edge there but I'd have to be looking at £150 per piece to cover postage and make about £20 for my efforts. Then there are the ebay fees :mad:

I've seen the same product on another website for £117 + £17 P&P so I am struggling to see how to make this work (although in fairness I think it's a chinese operated site).

Now it's not really looking profitable or worth bothering with yet these things are only going to become more and more popular as they're relatively new.

What I'd like to know is more about importing stuff and tax and how to reach a good audience without being diddled by ebay. Do I need a business account or can I get away with a personal account? How much are the business expenses and are they monthly or per item?

Am I missing some magical way of making this work?

ballisticbrian

It's not a great start to be honest, the import duty will depend on the item, and could wipe you out altogether plus you need to make sure your margin is sufficient to cover your gaurantee and customer support, particularly for ones which need replacing. Most companies will be thinking in terms of container or warehouse loads.

TrickyWicky

So is it just import duty I would need to pay or vat too?

Cornucopia

Mainly Import Duty, but the rate varies depending on the type of product.

I have looked into it, but it seemed difficult enough just to work out the categories involved.

Not sure about VAT. If you were operating solely in the UK, there are simplified rules you could use to make life easier, but not sure these apply.

Obviously if you get to a reasonable level of turnover, then you'll also be concerned with Income Tax, too.

I don't want to put you off, but if you've not done this before, I would suggest starting with something cheaper. There are lots of things where you can buy single items and small job lots from China that are under the £18 Import Duty limit. I would suggest trying a few of those to see how import delays and reliability works for you.

forgotmyname

What about quality control? Costly to return items so expect at least 30% returns for faulty and damaged items or just people deciding its not what they wanted or found it cheaper than your selling them.

sequence

It can be done, but what you've suggested seems to just be too expensive to start with. I'd look for another item. There are some items that can be had astonishingly cheap from china, whilst others are mysteriously cheaper to buy in the UK. So just keep looking until you find a better item to import. Don't forget income tax on top of the vat and import duty

RFW

sequence wrote: »

It can be done, but what you've suggested seems to just be too expensive to start with.

Exactly that.

Although obviously not an exact science, I often find that the price paid in dollars ends up being the price in pounds, once shipping and duties have been added. So if you import $1000 of goods it ends up costing £1000. Sometimes it can be less, so consider that a bonus.

If you're competing like for like with traders shipping direct from China, and sourcing in small quantities from them, you won't be able to.

Also if you want advice on VAT and import duties, call HMRC, they're usually happy to help.

Ebay fees for personal v business account are easy to find on Ebay. There's no way you should be carrying on a personal account.

In short, from your post, you should steer well clear of investing money until you know what you are doing. Another charge you have missed is the courier's handling fee when paying duty, adding another £10-£20 per shipment depending on courier.

soolin

You will need to register as a business both with ebay and with HMRC so will have tax and National Insurance (if applicable) to consider as well.

Forgotmyname makes a very valid point, as a business you will need to build in slippage and returns, so any breakages will need to be paid for by you, any losses or returns come out of your pocket as well and it does pay for your business projection to include a percentage for this. Buyers will have an absolute right of return and you would still have the outward shipping to pay

The other thing to cnsider is that there is a waiting time, what might be £120 now , in a month or so when your goods arrive may be lower due to market saturation. It would also depend on the goods, I might sell a higher end item if it was not branded, not a ' look a like' and defintely not clothing or anything baby related

Lastly what payment method can you use to pay your wholesalwer, is it entirely safe?

Brooker_Dave

TrickyWicky wrote: »

On ebay at present, they sell them direct from china for around £110 on ebay.com and £135 on .co.uk (down from £150 a few days ago but still up from £120 a couple of weeks ago). Now I figure they're making about £20 - 30 profit after the shipping and manufacturing costs.

If I import from them, each unit is around $112USD (£65 - 70) per item and the minimum order is 8 units at a total of $896 (£582 +/-). Now one unit is $38 to send so I simply multiplied that by 8 to give me a shipping cost of $308 but in reality that may be cheaper. The running total here is $1200 (£780 +/-)

Buy them off aliexpress and pay with alipay, their escrow service, assume that you'll be paying the duty and vat, but most times you don't.

Have them use DHL or EMS and you'll be looking at 3 days for shipping and proper tracking.

If you buy a few you should be able to get the shipping right down, but assume that there's no warranty, if they're duff, it's your loss.

steveo3002

id say dont bother...

after tax /duty/collection fee's assume one or some might be damaged or broken , then ebay fee's on the sale price isnt worth the hassle

edit..they also seem to want paying in dollars and you get stiffed for rates in thier favour too

lovinituk

TrickyWicky wrote: »

So is it just import duty I would need to pay or vat too?

You will pay duty and you will pay VAT. The rate of duty depends on the item you are importing and can range from 0% to silly%. Duty is calculated on the value of the goods and VAT is charged at 20% of the value of the goods and the shipping.

I'm guessing at the price you are looking at these are electronic goods. If they are a big brand name then forget it as they will be fake and/or illegal. If they are 'unbranded' then there are probably a hundred different versions of the same thing made in many different factories. They might all look the same but could contain various different kinds of components inside, some decent, some inferior.

You will be ultimately responsible if the goods injure someone or damage their property. You need to check that the goods adhere to all the relevant safety standards for the product which will almost certainly include needing to be CE marked. If they are CE marked then you need to check the test certification as its likely fake. The only way to be sure would be to have the goods tested yourself in the UK at a cost of hundreds of pounds.

If they arrive damaged or useless then don't expect to get your money back.

At the very least buy a sample first to see what they are like but that doesn't guarantee that your next big order will be of the same quality.

If this is a first time venture for you I would look for something less risky to be honest. I have been importing stuff from China for a few years and even have my own brand of a particular item manufactured there. But I wouldn't touch electrics/electronics as it can be a bit of a minefield and you really need to know exactly what you are doing and have a decent relationship with a trustworthy supplier.