Your first China order: a step-by-step checklist

Before you talk to anyone

Know what you are buying well enough to describe it in numbers. Not a photograph and a hope: dimensions, materials, the two or three things that must be right, and what you would consider a defect. If you cannot write that down, you are not ready to ask for a quote, because you will not be able to tell what has been quoted.

Check the commodity code for your product and find the duty rate before you commit to anything. This is also where you check whether anti-dumping duty applies to goods of Chinese origin under that code, because it is charged on top of normal duty and can be several times larger. Finding that out after a container has sailed is the single most expensive discovery in importing.

Work out roughly what a landed unit will cost you: goods, freight, duty, clearance and delivery, tooling and samples spread across the run, and an allowance for units you cannot sell. If the business does not work at that number, it does not work.

And check whether your product is regulated. Toys, electricals, anything connectable, cosmetics, food contact materials and PPE all carry obligations that fall on you as importer, and they are far cheaper to plan for than to retrofit.

Choosing and checking a supplier

Shortlist several, not one. Ask each the same questions against the same written specification so the quotes are comparable, and treat a price well below the others as information rather than a bargain.

Verify the company before you engage seriously. Ask for the business licence, read the registered scope of business, and check the company against the National Enterprise Credit Information Publicity System at gsxt.gov.cn. Confirm the name on the licence, the contract and the bank account all match exactly.

Ask for a live video walk of the production line, and ask them to show where your product would run and where quality checks happen. Twenty minutes here tells you more than a week of emails.

Ask who holds the test reports for regulated goods, in whose name, and covering which configuration. Make that part of choosing a supplier rather than a request you make later.

Getting the order right

Put the specification in writing and make it part of the order: dimensions and tolerances, materials by grade, colour to a reference, packing and units per carton, labelling, what else is in the box, and the defect standard with an agreed inspection rule.

Agree the tooling position explicitly if there is tooling: who pays, whether it is amortised, and who owns it. Ownership is what decides whether you can ever change supplier.

Stage the payment. A deposit to begin production with the balance released against a satisfactory pre-shipment inspection is normal and reasonable. Tie the balance to that event rather than to a date.

Get every agreement into the order document rather than leaving it in chat, and check the payment account name against the business licence rather than the invoice.

Before the goods ship

Approve a pre-production sample made with production materials, tooling and process, not a hand-made prototype. Seal and retain a copy in the UK and reference it in the order.

Arrange a pre-shipment inspection. This is the last point at which a problem is cheap, and the difference between fixing something in the factory and discovering it in your warehouse is the difference between a phone call and a write-off.

Check your documents before the vessel leaves: commercial invoice, packing list, bill of lading, and any certificates or test reports your goods need. A shipment that arrives without its paperwork sits at the port accruing charges daily.

Confirm the incoterm and what it actually includes, and get an all-in quote to your door from your forwarder, asking specifically what is not covered.

Arrival, and the admin that saves you money

Make sure whoever makes the customs entry has the right commodity code, the correct customs value including freight and insurance to the border, and your VAT number.

If you are VAT registered, use postponed VAT accounting so import VAT goes on your VAT return instead of being paid at the border. It needs no approval and no application, but it does not happen automatically, so tell whoever makes the declaration that you are using it.

Keep the file. Quotation, specification, approved sample record, order, inspection report, invoices, shipping documents and the customs entry belong together, and you must keep the documents supporting your customs value for at least four years.

After the first order

Write down what actually went wrong, because the second order is where the money is made. Record the real defect rate, the real lead time and the real landed cost, and put them into the next specification and the next plan.

Then decide whether to keep going deeper with this supplier or to develop a second source. The best moment to find an alternative is while you do not need one, because a buyer with options negotiates differently from a buyer without.