Trump China Trade War Update… and how to find out if your products are affected

On October 30, 2018 President Trump announced that if his meetings with Chinese President Xi Jinping at the G-20 Summit in Argentina late November don’t go well, then he will slap a tariff on ALL remaining $257 billion worth of imports from China.  

In other words “the whole enchilada” or everything that is made in China and imported into the US may be hit up to an additional 25% in tariffs.  

Why is he doing this?  Again, it’s not only to reduce the trade deficit, but also to get China to play fair and help the US gain equal access to the Chinese market.  See my previous post here.

In my view, Trump, ever the savvy negotiator, is using the threat of this tariff as leverage to get a “great deal” from China.  

Will China bow down so easily?  I’m not so sure.

But from our ecommerce business perspective here’s what you need to know:

  1. If the meetings don’t go as planned, then the final round of tariffs would be approved in early Dec.   And according to US law they will be enacted 60 days later. This would be early Feb 2019 which coincides with Chinese New Year.  
  2. Given the duty rate in the other China Tariffs I would expect an equal 25% tariff to pass eventually.  If not outright, it may be passed in stages starting at 10% and then increasing to 25%.

For some products, it’s too late and they are already covered in the previous rounds of China tariffs.  

Some of you may be wondering how do I find out if my products are affected?  

  1. Find out your HS Code or Harmonized Item Description and Coding System.  Whenever you import a product, the HS code is used by US Customs to determine the duty rate of your product.  

    To find out the code if you don’t know it, you can ask your supplier and then check with your customs broker.  
  2. Check the Tariff lists released so far.  You can find them at 80/20 Sourcing .  
    TIP: Use the “Find” feature to search for your HS Code quickly.
  3. If your HS Code is listed in the list then it is liable to a +10% tariff until Dec 31, 2018.  Then it will increase to a +25% tariff beginning Jan 1, 2019.

    If your code is NOT listed in the lists then you’re product is not liable to any additional tariffs… yet.  

I’m doing some research on US small businesses that have been affected by the China tariffs.  If your business has been impacted please fill out this 5 minute survey.  

We are putting together feedback to take this to US Government officials to share how these tariffs are impacting the business community.  So make your voice matter and fill out this survey today.

 

Thanks,

Gary

PS: If you’re looking for more private label business, I have a few openings left in my coaching program before the end of the year.  If you’re interested you can apply here.

I met with White House Administration leaders last week… here’s an inside look at how the China tariffs will affect your ecommerce business

Last week, I had the privilege of being invited to attend meetings in Washington DC with members of the White House Administration, Department of Commerce, Office of US Trade Representative, Congress, and Senators to share my views on how the China tariffs are affecting the supply chain of American businesses and especially small businesses.

I was a member of a delegation with the American Chamber of Commerce in Shanghai’s Washington DC Annual Doorknock as I represented the Supply Chain Committee.  

Unfortunately, President Trump was in New York and couldn’t meet with us… But we did get to meet with over a dozen key leaders in Washington.  

Here’s a recap of what I learned and how it affects your e-commerce business.  

The Goal for the US is NOT to shift production out of China.  

Many people assume the main goal is to bring the jobs back to the US but I’m afraid that this is not true and the boat has long sailed for much of the manufacturing sector in the US.  Allow me to explain.

Key officials of the White House Administration explained to us that the goal is to LEVEL THE PLAYING FIELD when it comes to trade with China.  

As you may have heard, China has not been playing by the rules when it comes to trade.  Since being accepted into the World Trade Organization (WTO), they have not been abiding by the rules.  They have been accused of forced technology transfer, theft of intellectual property (IP), as well as computer hacking among other offenses.  

China entered the WTO in 2001 and has had 15 years to get their act together but things have not changed.  

In addition, getting equal market access in China is a huge challenge for many foreign businesses including American companies.  

Therefore President Trump has decided to use import tariffs as a way to create leverage for the US to bring China to the negotiating table about these issues.  These tariffs have gotten Beijing’s attention by hitting them where it hurts. In their economy and their pocketbooks.

What is the impact on e-commerce businesses?

“When Elephants Fights, The Grass Gets Hurt” – African Proverb

The first impact is on the UNCERTAINTY on the supply chain as a whole.  Taking a step back let’s break down what a supply chain consists of first.  A supply chain consists of raw materials, manufacturing, logistics, and the costs involved to manufacture and ship a product from the country of origin all the way into the hands of the consumer or end user.  

The tariffs have cast a cloud of UNCERTAINTY over whether these businesses can continue to profitably source and import products from China.  According to a recent survey by Amcham Shanghai of American, 31% of American businesses are considering delaying or canceling investment decisions as a result of these China tariffs.

And it’s not a simple matter to shift manufacturing out of China to Southeast Asia or South Asia.  In fact based on the survey of American businesses, it is not happening very much. 64% of the companies surveyed have NOT relocated are NOT considering relocation out of China.  

Many feel the goal of these tariffs is to bring jobs back to the US.  However according to the survey, only 6% of American businesses are considering relocating back to the US.  

When I spoke with a Director of Supply Chain for a US packaging company, he told me that most of that relocation to the US will be in the form of automation and robots – not actual human labor.  In other words the jobs created will likely be single-person operators running a factory full of robotic arms and automated equipment. This is not exactly what the administration had in mind in terms of creating jobs.

So when will the tariffs be resolved?  

Based on our meetings with Washington policymakers as well as a special meeting with the Consulate General of China’s representative in Washington DC, both sides seem to be deadlocked at this time.  

A couple, obstacles are keeping them from sitting down to negotiate.

On the American side, the US is currently enjoying a strong stock market and positive economy so it is not in a hurry to negotiate to lower tariffs.  Trump has this leverage behind him in the form of the strong economy and he is happy to use it against China while he can.

China, on the other hand, is feeling that the US is trying to “contain” it and may not respond well to this threat.  In fact, Beijing is claiming that it is being “bullied” by the dominant US counterpart.

A former US Trade Representative leader shared with me that this strategy may backfire since members of China’s Party feel they cannot lean towards the US side or even consider their demands or else be seen as a “traitor” to their country.  So China is not eager to negotiate either at this time.

In addition, the US midterm elections are coloring everything

The US midterm elections are coming up in November.  But word on the street in Washington is that in the Republican party nobody is willing to go out on a limb against Trump at this time.  

And among Democrats, nobody is going to defend China.  

So it seems these tariffs are not a short-term play.  

A White House Administration representative told me that Trump wants a “fundamental change between the US and China.”  

So the President is “moving pieces on the board in a dramatic way” through these tariffs.  

 

Another official from the Department of Commerce said that the US is aiming for “short-term pain for long-term gain”.  

Other government officials have revealed to me that the focus on issues will not change even if the Trump administration changes.  They are prepared to play this out for a long time.  

What’s next?  $267 Billion

China has retaliated to the tariffs with tariffs on their own on US imports into China.  Trump said that if China retaliates then he is ready to levy an additional round of $267 Billion in tariffs.  If that passes then essentially all $505.5 Billion of Chinese imports will be hit with the tariffs.

This means that your products almost certainly get hit by the tariffs if they haven’t already.

What are some alternatives to tariffs on the table?

There have been some discussions of a multilateral approach to trade beyond China-US.  One of these measures is the “Asia Reassurance Initiative Act” or ARIA.

Other Senate leaders are working on a China Strategy Working Group to seek alternatives to the heavy-handed tariffs being levied now.  

It remains to be seen if these alternatives will have any significant impact away leading trade policy away from tariffs.   

Conclusion: These tariffs are not going away any time soon.

Be prepared with your supply chain if you’re sourcing from China going forward.  I would especially pay attention to your profit margins and decide how or if you can absorb the additional 10-25% in tariffs.  

After reviewing how these China tariffs will affect your e-commerce business, next week we will take a deeper dive into how you can prepare your business for the 4th quarter and Chinese New Year.

-Gary

PS: Has your business been affected by the tariffs?  If so, I’d like to hear from you. Please fill out this short survey here.  

The Vision behind the 7 Figure Seller Summit and Live Kickoff event Sun Aug 12 @ 8pm EST

I wanted to take a moment to share with you the vision behind the 7 Figure Seller Summit.  

Earlier this year in our 80/20 Ascend private mastermind group, we invited a guest speaker on the call to share about their 7 figure e-commerce business and what was working for them.  It was super helpful and several members told me afterwards that they want to learn from more million dollar sellers…. what systems they have in marketing their products. What exactly is working for them… and what not to do so they can save time and money and double down on the right things.  

Then it reminded me of the quote from Jim Rohn “ You are the average of the 5 people you spend the most time with”.  Many ecommerce sellers are a one-man or one-woman show holed up and working out of their basement.

They wanted to seek the wise counsel of other successful ecommerce entrepreneurs and learn what’s working for them.  

So I reached out to my network and invited 7 Figure Sellers to share what’s working for them and that’s the how the 7 Figure Seller Summit was born.  

I love attending in-person conferences such as the Global Sources Summit when I can.  Not only to learn but to build relationships and friendships with other successful entrepreneurs.  

However sometimes life gets in the way.  Here’s what one person who upgraded to the 7 Figure Seller Summit said:

And I’m in a similar situation.  

Exciting news – my wife and I have a baby on the way later this year.  So I will spend more time with my family and less time traveling to attend in person conferences.  

For some, spending thousands of dollars on plane tickets, hotels, Ubers, and meals to attend a conference may be out of reach right now.  That and the time away from family and your business can make it a hard pill to swallow.

So I decided to create the 7 Figure Seller Summit and bring a community of million dollar ecommerce sellers and experts to you.  This way you can surround yourself with successful ecommerce sellers and learn from them.

It’s like having different mentors helping you with all the essential parts of your business: mindset and habits, scaling your business, marketing and branding, profitability and building out your team.  

Even if you don’t have the working capital to attend events, no worries.  

These sessions will be free to watch for 24 hours when they launch.  So make sure to signup for your free pass if you haven’t already so you don’t miss anything.

Some of you may have cash flow issues and you can learn how sellers like Greg Mercer bootstrapped his Amazon business from the start and what he would do DIFFERENTLY now than before to scale faster.

Even if you are a STUDENT you can learn from 7 Figure Seller Nathan Hirsch how he built his first ecommerce business out of his college dorm room!

And if you’re no longer a twenty-something (like me), discover how Paul Miller launched his 7 Figure Amazon business using product licensing… while in his 50s!  

Join the 7 Figure Seller Summit to level up your ecommerce game.  It launches next week on Aug 13 and runs until Aug 17th. We have 20+ 7 Figure Sellers and ecommerce experts who will share their best strategies what’s working now.  

If you don’t have time to catch them all there’s the option to upgrade to the All Access Pass where you will get lifetime access to all 20+ sessions so you don’t miss anything.  

“I attend a lot of Amazon conferences and there are always so many little diamonds of information that can help take your business to the next level, the beauty here with the virtual conference [all access pass] is you can watch that content over and over until you fully understand how to implement into your business” – Chris Davey, 7 Figure Seller and founder of FBA4U

I encourage you to grab the All Access Pass now if you’re considering it because the early bird discount will expire once the summit launches and the price will go up.  

And finally, I would like to invite you to our 7 Figure Seller Summit live kickoff party this Sunday at 8pm.  I will share how to get the most out of the summit, a behind the scenes look at the sessions, and there will be some surprises as well and exclusives for people on the live only.  

So consider this your official invitation to attend the Live 7 Figure Seller Summit kick-off party on Sunday, Aug 12 at 8PM EST.

It’s your chance to meet me and learn all about what’ll be happening during the summit — and win an awesome prize.  

Since it’s the weekend, I’ll have more time to answer your questions and get to know you.

You can join the LIVE kick-off here (Sunday, Aug 12 at 8PM EST.).

After that, 7 Figure Seller Summit runs from Monday, Aug 13 through Friday, Aug. 17.   

See you then!

Gary

P.S. Put this in your calendar: Join me live this Sunday, Aug 12 at 8PM EST.

How Amazon Caters to Chinese Sellers (and How to Compete)

As you may have heard, Amazon is helping Chinese sellers sell on its platform.  However as the Chinese saying goes “With crisis comes opportunity”.

I’d excited to share a guest post written by the good folks at Skubana who share how Amazon is helping Chinese sellers and how to compete in spite of that.   

Skubana is an all in one solution that unifies everything you need to run your business into one easy to use platform. From inventory and order management to purchasing, and fulfillment to analytics, Skubana has it all so you can build your business and become a success.

How Amazon Caters to Chinese Sellers (and How to Compete)

eCommerce has long been a global practice. But with leading e-retailers like Amazon making it easier than ever to sell directly on their platform, this globalization of online selling has enabled merchants to access consumers directly no matter where they live, and thus cut out the middleman of traditional supply chains.

And, while this may seem all well and good for customers looking to get the best deal on their favorite products, the internationalization of online selling pits online vendors against one another, making it harder than ever to succeed.

One of the biggest problems plaguing the eCommerce industry is the rise of Chinese seller success on the largest online retail platform around, Amazon.

Thanks to Amazon FBA, and a whole host of other advantages, sellers are finding that the Chinese are not only able to cut costs when it comes to manufacturing their products in their native country, but also forgo having to work with anyone other than Amazon to store, package, and send out their products.

If you’re an Amazon seller feeling the impact of Chinese seller success, and are wondering how it’s happening (and what can be done to fight back against it), you’re in the right place.

Today we’re going to look at how Amazon caters to Chinese sellers, and what you can do to make your mark and compete against these e-retail rivals.

How Does Amazon Cater to Chinese Sellers?

There’s no denying that Chinese manufacturers are good at what they do. After all, they have years of exporting experience and a deep knowledge of what’s being sold, how much it’s going to cost to make, and where the best market is to sell each product.

That alone is enough to make competing against Chinese-based sellers on Amazon hard to do.

But there’s a lot more to it than going up against manufacturers with decades of experience. In fact, there are several things Amazon does to cater to Chinese sellers, thus aiding their growth and hindering everyone else. As a result, even big name brands are finding it increasingly hard to compete and succeed.

The Evolvement of Direct-to-Consumer (D2C)

The concept of direct-to-consumer, where brands cut out the middleman and sell their products directly to consumers, led the way for the factory-to-consumer concept to evolve.

Manufacturers across the board (and the globe) saw how easy it was for sellers to use Amazon’s Fulfillment by Amazon (FBA) to sell products right to customers without having to employ the help of a third-party warehouse storage facility, a packaging company, or a delivery service.

Instead, online sellers were selling items and letting Amazon handle the rest: packing, shipping, and even customer service.

As the most competitive manufacturing nation in the world, China is now able to avoid problems associated with finding American companies to do business with in order to fulfill their customers’ purchases. Instead, they just take matters into their own hands, use Amazon FBA, and sell directly to their customers.

More on Amazon FBA

Using Amazon FBA, Chinese manufacturers can cut costs on their end (and lower retail prices) so they can sell the same products for much less, while still generating more revenue than everyone else.

They also make things much harder for United States sellers in the following ways:

  • Sales Tax. As a United States seller, you know there are many rules and regulations to follow. One of the biggest ones is that you have to charge sales tax for every item you sell and pay the IRS your dues. In China, there is no such thing as sales tax, which makes prices lower for the consumer, increases product sales, and boosts Chinese sellers’ bottom lines.
  • Shipping Rates. Amazon seeks to be a leader in the eCommerce industry worldwide, not just in the United States. That’s why offering incentives, such as lower overseas shipping rates, have been enacted to encourage people in countries such as China to sell on Amazon. After all, every sale (no matter where it happens) generates Amazon revenue. So, the more people they can get selling on their platform, the better. Did you know it’s cheaper to send a package from China to the United States than it is to send it domestically in the United States? Well, it is. That said, here are some insider tips for saving you money.
  • Easier Shipping Process. In 2015, Amazon helped Chinese sellers looking to sell directly to those in the USA, Canada, and Europe by registering with the Federal Maritime Commission. This helped lower the cost of ocean freight, and streamline the shipping process, so products could be shipped overseas efficiently and at a low cost to manufacturers.
  • Chinese Support. Amazon’s management system, Seller Central, comes in a Chinese-language version, making it easier for Chinese sellers to navigate Amazon’s platform. They can also access Chinese-speaking support staff.
  • Lower Taxes. There is no such thing as income tax in China (because the Chinese government wants to facilitate global trade), again increasing profits and opening up more opportunities for the Chinese to dominate the online retail space.

As you can see, eliminating the need for traditional supply chains, and instead using Amazon FBA to handle everything, Chinese sellers not only save on overall costs, but make more money by offering cheaper products for customers to buy.

The Rise of Counterfeits

Amazon’s system of listing like items on product pages keeps things organized, reduces duplicate listings, and gives consumers a chance to compare similar products.

Unfortunately, this has caused many issues when it comes to counterfeit items.

Though Amazon does not actively allow counterfeit items to be sold on their platform, the truth is, it happens.

According to OECD, over 60% of the world’s counterfeit products originate from China. It’s even suggested that 40% of their own domestic online marketplaces are made up of counterfeit goods.

And what about Amazon customers?

Knowing the difference between a real brand and a counterfeit one can be tricky for some consumers, especially when the original brand hasn’t taken the right measures to protect their brand and verify their brand for people who land on their Amazon page.

Not to mention, if an Amazon seller uses Amazon’s fulfillment centers, there’s a good chance the FBA stamp of approval will be on their product page, make it even harder for unsuspecting consumers to tell the product is a fake. After all, if Amazon supports it, how could it be  counterfeit?   

In their quest to be the most cost-effective online shopping platform in the world for any product imaginable, some critics feel Amazon hasn’t taken a hard enough stance against the influx of counterfeit items that find their way onto hard-working, rule-abiding Amazon seller pages.

This, paired with the fact that Amazon continues to court Chinese sellers, and generate tons of revenue off all products (counterfeit or not), makes it extremely difficult for non-Chinese sellers to succeed.

In response, let’s take a look at how you can compete with Chinese sellers, despite the odds being against you.

1. Focus on Customer Ratings

Once you develop strong relationships with your customers, you can bet they won’t be as likely to buy from those undercutting you with lower prices (and notoriously cheaper materials). In fact, customer loyalty on both Amazon and your own eCommerce site can go a long way when it comes to pushing ahead of the competition.

Focus on encouraging customers to leave positive reviews on your Amazon page. Not only will this help your Amazon rankings and draw more traffic to your product page, it will show new customers you’re a reliable brand that can be trusted. With Amazon trying to crack down on fake reviews, your focus on legitimate, positive reviews will make a huge difference in the long run.

In addition, regularly monitor your Amazon reviews for a sudden influx of negative ones.

Oftentimes Chinese manufacturers selling similar products that don’t match your quality of craftsmanship can drum up a ton of negative reviews that will end up on your product page too.

If you notice this happening, make sure to take a proactive approach and report it to Amazon immediately before your brand, and reputation, are destroyed.

2. Establish a Brand

If a customer comes to Amazon looking to buy a product, with no intention of buying a specific brand, which product do you think they’ll end up purchasing?

If you guessed the one with the lowest price or the most reviews, congratulations, you win.

While beating out the lowest price every time isn’t possible, it is possible to build your business to be more than just a product with a logo. Instead, you can build your business to be a product, with a logo and reputable brand to back it.

When you do this, like Anker has done successfully against their competition Belkin, you can increase consumer interest in your brand and your products and become the leading seller.

The best way to establish yourself as a brand people recognize and continue to buy from, focus on the following:

  • Listen to the feedback customers are giving you
  • Find the sweet spot when it comes to price: not too high and not too low
  • Research your competitors and see what they have that you don’t
  • Only sell high-quality products that do what you claim
  • Focus on providing stellar customer service to everyone that has an issue
  • Advertise on other platforms: you own eCommerce site, social media, and email
  • Consider opening a brick and mortar shop to complement online sales
  • Invest in Amazon sponsored ads

Using the power of Amazon, as well as the power of the internet as a whole, is a great way to increase brand awareness and acquire customers that want what you have to offer despite there being similar products at a much lower price.

3. Capitalize on Best-Selling Products

If you do a little research, you can easily find items that are similar to yours that are selling well on Amazon. From there, you can make improvements on your product, adjust the price to be more than competitive, and start selling.

For instance, check out Amazon’s best-selling private label products and copy what they’re doing. That’s what Anker did. Capitalizing on the Echo Dot, which for $49.99 was a steal of a deal…

…Anker created the Eufy Genie, keeping all the features the same and offering it at the even lower price of $34.99.

Because Anker has done so well to brand itself as a reliable and trustworthy brand, not only on Amazon but across the web, this copycat product has done extremely well.

After all, they didn’t just rip a brand off and manufacture it as cheaply as possible, which is what a lot of Chinese sellers do.

They took a best-selling product and applied their expertise to make something better and more cost-effective that customers love.

4. Open Up Shop

Selling online is a great venture to get into. But an even better venture, especially when competing against Chinese sellers on Amazon, is to open up a brick and mortar shop to complement online sales.

When local customers can come to your retail shop in person and check out what you have to offer with a hands on approach, they get a better idea about your company as a whole.

They’ll feel more confident in what they’re buying because they can see it in real life and even touch it. They’ll also be able to interact with employees that are knowledgeable about your brand and specific products, which makes you seem more professional and reliable.

Take for instance Boll & Branch. Up until 2017, they were strictly an eCommerce shop selling their products at an alarming rate to online customers. So, they set up a brick and mortar shop and are pushing more sales than ever before.

(Image Source)

Or…

Aim to connect with your customers on a whole new level by opening up a retail shop in town. Once they buy from you in person, you can then rely on those that don’t want to come into your store all the time to buy from you on platforms like Amazon because they’ll be loyal customers by then.

Not to mention, you’ll save some money selling in-store because you won’t have to deal with online sale logistics, shipping, or returns.

5. Find Influencers

Never underestimate the power of people in your industry that have large followings and can help expose your brand to a broader audience.

For example, take a look at Kim Kardashian, who is known for her millions of followers on Instagram. Promoting Flat Tummy replacement shakes to all her followers, and raking in nearly 1.5 million likes, you can easily see how this eCommerce brand is benefiting from her reach.

And don’t think for a second that a lot of Chinese sellers are going to all the trouble to find influencers for their “brands.”

Finding influencers to help you build your brand, drive traffic to your eCommerce shop and Amazon product pages, and generate you more sales is easy to do if you know what you’re doing:

  • Understand Your Target Audience. If you want to hand over the process of promoting your brand to someone else, it’s crucial you have a thorough understanding of your target audience. Know their pain points, how you can solve them, and what they’re looking for in a brand. Plus, make sure the influencer you’re working with has a following that will be interested in what you have to offer.
  • Find Reliable Influencers. Use tools like Influence.co to find people that are within your industry that are willing to promote your brand. Sort influencers based on demographics and social media platforms and recruit only those that will help you succeed.
  • Reach Out To Your Top Choices. After monitoring your top choices to see how they interact with their own audience, it’s your turn to reach out to them and see if they want to work with you. Set up interviews and ask them how they feel about your business, what they’ll do to promote it, and how they’ll handle questions and concerns.

After you have an influencer that has agreed to help promote your brand, set up a campaign to track their actions and your company’s success.

More importantly, make sure they accomplish what you want:

  • Expose your brand on many platforms, including their website, social media platforms, and email marketing campaigns
  • Offer free products to boost interest in what you’re selling
  • Positively endorse your product to others and gather reviews from customers

Getting involved in influencer marketing is a great way to generate natural traffic and sales of your products. It’s also a great way to get ahead of Chinese sellers on Amazon that are too concentrated on outselling you within Amazon to think outside of the box and promote products outside of the Amazon platform.

Final Thoughts

The reality is, Chinese sellers on Amazon aren’t going anywhere. In fact, international competition itself isn’t going anywhere, especially because Amazon continues to cater to global manufacturers and sellers because they too want to maintain their status as the number one global online retailer.

That said, you can step up your game and beat out the Chinese sellers threatening to take away your sales with cheaply made knockoff products.

By forming a deeper understanding of your target audience and the market as a whole, you’ll be able to establish yourself in the midst of the competition as a reliable brand that can outperform any competition, regardless of price.

So, aim to forge strong relationships with your customers, sell nothing short of high-quality products that people will be willing to pay for, and even consider expanding your business outside the borders of Amazon if you want to continue to grow and succeed.

Because in the end, most Amazon sellers, Chinese-based or not, are simply not taking the time to do these things, leaving opportunities for you to become the leading seller wide open.

—

Speaking of Skubana, co-founder Chad Rubin, is one of the speakers at the 7 Figure Seller Summit.  He will be sharing “How to Systemize and Automate your e-commerce business in a way that can 4x what you make and keep… even as a one-woman show”.  

Chad is a top 250 Amazon seller and grew his e-commerce business from 0 to $20 million dollar valuation in just 7 years.  Check out his session on Aug 13th by getting your free pass (limited time) to the summit here.

 

-Gary

 

Big announcement – 7 Figure Seller Summit (online)

Over the last couple weeks you’ve been hearing me talk about the an online event that I’m creating that will help you learn to scale your business from the top ecommerce sellers in our industry.  

Good news!  The time has come when I can share the details with you… and since you’re on my email list I wanted to let you to be the first to know!

Announcing the 7 Figure Seller Summit (August 13-17, 2018)

Get all the details about the online event here:

I believe in the Jim Rohn quote “You are the average of the 5 people you spend the most time with”

Many Amazon sellers and e-commerce entrepreneurs are one-man or one-woman shows.  They may be working alone in their basement on their online businesses and struggle to surround themselves with like-minded, successful entrepreneurs to help them learn, grow, and scale their businesses.

I should know because I’m one of them!  

So I decided to invite some of the most successful, sharpest, and proven 7 Figure Sellers to teach you the secrets of their success.  

I’m very grateful to have very successful entrepreneurs including Greg Mercer, Mike Jackness, Chad Rubin, Bernie Thompson, Sophie Howard, Chris Rawlings, KJ Robinson, Andy Humphrey, Eddie Levine, Dave Bryant, Chris Davey, Sean Smith, Taylor Benterud, Jordan Linberg, Elaine Pofeldt, John Di Giacomo, Jared Haw, and many others come speak.  

Don’t miss out on this amazing online event (and it’s free for a limited time)!

We have an amazing lineup of speakers and this event is for YOU the e-commerce seller.  

I guarantee that you will learn and get tremendous value in learning to scale your business to 7 Figures from these real entrepreneurs who are hustling and persevering day in and day out.  

I admit that I have been less active recently and it’s because I’ve been working so hard on this summit for months so I could find the right people to feature and create the best online summit for e-commerce and Amazon sellers.  

So I’m super excited for you to experience it – I welcome you to join me on the journey to 7 Figures…

Will you join me?  

“Yes – give me my free pass now”

-Gary

PS: Don’t miss out on what people are saying about the 7 Figure Seller Summit… “Thank you Gary for putting this together… This is something way needed in this space.. Too many gurus, not enough people really doing it talking about what they do.  [It’s] a good mix of well known people and less known people because they don’t speak, they don’t teach, they just do it. Gary’s in the position to find these people and GET THEM TO SPILL THE BEANS”

Grab your ticket now!

An inside look at how Amazon is HELPING Chinese sellers… and what we can learn from them [webinar]

Recently, I was invited to attend an Amazon conference in China for Chinese sellers. I was surprised that Amazon themselves are helping Chinese sellers succeed.  

Chris Rawlings at Judo Launch who also is based in Shanghai asked me recently about this.  So we decided to do a live webinar. Come join us to find out what we learned:

  • How is Amazon is helping Chinese sellers skyrocket their sales.  
  • Are all Chinese sellers black hat?
  • And what PL sellers can learn from the Chinese suppliers and sellers best practices… and how to implement them for themselves.
  • Live Q&A afterwards

See video here.

Date: Tuesday, July 17th, 10AM EST

Talk soon,                                                                                                                                        Gary

PS: If you have a burning question about this, hit reply and let me know!  

 

“The Experts Guide To Importing From China” [PDF]

Lately I’ve been getting more questions about sourcing from different online marketplaces.  Obviously Alibaba is the one people turn to first when sourcing a product. But besides did you know that there are two other online marketplaces that many people are not aware of?  

Recently I was invited to contribute a chapter in Freightos’ “Experts Guide to Importing from China”.  In it I compared and contrasted different marketplaces where you can find suppliers and my recommendations where to look and where to stay away from.  

You can read the article or signup to download the entire guide as a PDF for free here:

The Experts Guide To Importing From China

Hope that helps!

-Gary

[GUIDE] How to find the right private label manufacturer for your e-commerce business

FACT: there are over 2.8 MILLION factories in China. They range from state of the art and fully-automated manufacturing facilities, to loose groups of stay-at-home moms and grannies who cut and sew textiles from their own bedrooms. Whatever you’re looking for, there’s a pretty good chance there’s a factory in China that can make it.

But if you’re an Amazon private label seller or an ecommerce entrepreneur, how do you know which type of manufacturer is right for you?

In other words, how do you find the right private label manufacturer for your business? One that makes products at the right quality and the right price, provides the service you need, can deliver on time, make the modifications you want, and manufacture them under your brand.

Good news – I was asked by the good folks at Webretailer.com to write an in depth guide on “How to find the right private label manufacturer” and I’d like to share it with you.

In this guide, you will learn:

  • The 10 signs of a good private label manufacturer
  • How to speed up replies from Chinese suppliers more quickly… even if they don’t respond to emails or Skype
  • Why 1688.com is NOT a good place to find a private label manufacturer
  • And even if you find a “Walmart supplier” why they may not want to work with you!

Check out the guide here How to Find the Right Private Label Manufacturer

I’m curious does your current supplier fit the bill?  Hit reply and let me know.

-Gary

The 5 steps to finding profitable product ideas while traveling this summer

Recently one of my readers who was taking a vacation to Florida asked for my advice what he should do to look for product ideas for his e-commerce business while traveling.  

Many of you may be traveling this summer so I thought I’d share my advice for looking for product ideas while traveling and how to stay productive while sipping Mai Tais on the beach or taking the kids to Disney World.  

First things first – traveling can be a great source of ideas.

By traveling you are stepping outside your comfort zone and your daily routine.  You will experience new sights, smells, sounds, tastes, and experiences. And some of those things can be product or business ideas that you can use for your business.  

For example – did you know that in 1983 Howard Schultz, former CEO of Starbucks, “discovered” cafe culture which he later “borrowed” and created Starbucks as we know when he traveled to Italy for a trade show?

The trade show wasn’t too interesting but in the mornings he was fascinated by the culture of the local Italian espresso bars.  

A young Howard Schultz on a trip to Verona, Italy where he “discovered” Italian Cafe Culture which he later brought to Starbucks

“In each shop I visited I began to see the same people and interactions, and it dawned on me that what these coffee bars had created, aside from the romance and theater of coffee, was a morning ritual and a sense of community,” said Schultz.  These Italian coffee bars also served as public meeting areas.

A light bulb went off in his head and he brought this idea back to the US.  Fast forward to today a star was born when Schultz traveled to Italy. Imagine if he didn’t travel to Italy, Starbucks as we know it may not exist!

So what should you do to look for ideas and especially product ideas for your e-commerce business while traveling?  I will make this short and sweet to give you the 80/20 of what I do to find profitable product ideas when I travel.

Step 1: OBSERVE

I always keep my eyes open as I’m traveling – e.g. at the airport/train/bus station for things that people are using that you don’t normally see.  

Check out local boutiques and gift shops.  I love to visit local marketplaces to find local items that could be sold profitably online.

Check out magazines like the inflight magazine for ideas.  Add those to your list of product ideas.

Step 2: LISTEN

Call it eavesdropping if you will, but I like to listen in to what people are talking about – can you spot any new trends, hot topics, and things you don’t usually hear about in your day-to-day life?  

For example in the fashion industry, many insiders travel to a luxury resort town on the French Riviera called St Tropez.  Historically it was frequented by many artists around Europe. It’s also a popular destination for beach goers, jetsetters, and the rich and famous.  

St Tropez is one of the meccas of fashion and where many trends begin before they reach tipping points later.  Designers will make a pilgrimage there to observe what people wear at the beach and at the cafes.  They may even take pictures and steal these designs to sell back home. The designs, prints, and colors seen on the fashionistas on the streets of St. Tropez earlier in the year will show up on hangers in stores like Forever 21, ZARA, etc later in the year.

So the takeaway is that if you’re going to a trendsetting or hip area pay attention to what people are talking about, what they’re wearing, and what is usual because that could be the start of the next trend!

Step 3: EXPERIENCE

When traveling one of my favorite things to do is to try out new experiences and visit new places.  Museums are a great way to learn about the local culture and also what makes people tick.

I also talk to locals about where the best local restaurants (or street markets) are to live like a local.   

I also love to try out new things.  I’m into cooking and I try to take a cooking class when I visit a new part of the world.  You might find an ingredient there or a cooking utensil there that is unknown in your part of the world that you could profitably sell.  

If you’re into sports you might want to try kitesurfing, paragliding, or rock climbing on your next trip.  All of these sports involve their own gear that could be a potential goldmine of products to sell online.

Step 4: BE CURIOUS

Most of all have fun with it!  Enjoy your time sipping maitais at the beach or having fun at Disneyworld with the kids and at the same time be curious about new product ideas.  

Beginner’s mind – Think of it like being a child in a new place.  You will sometimes stumble and fall down (i.e. get lost) but at the same time everything is new and fresh and you’re learning everyday.  Write down these ideas that come to you when you are curious.

Remember to be open minded.  Don’t worry about coming up with bad ideas because if you don’t write them down, the good ideas will not come out either.  

“Good ideas come from bad ideas but only if there are enough of them”

-Seth Godin  

So remember don’t self-censor your ideas.  Write them all down.

Step 5: REVIEW AFTERWARDS

One of the common frustrations I see a lot beginners face is trying to immediately research every product you find.  This will get frustrating FAST especially if that product is not doesn’t fulfill your criteria.

Instead, what I do is batch the review process.  When you have your time after your trip or when you’re not traveling, set aside some time (a couple hours) to sit down and review the list and do research on Jungle Scout or your favorite research tool. This way you are in the explorer’s mindset while you travel and you’re not afraid of finding “bad products”.  

I find it’s more effective and efficient to do this in one sitting rather than researching one at a time.  And this can be done after you get back.   

These are my 5 steps – now I want to ask you.  What advice would you give to help others find product ideas while they travel?  

Gary

Trump is making things harder for e-commerce sellers… China import tariffs and what you can do about it to stay profitable as a seller

Update Sept 17, 2018

Talks continue to heat up in the US-China “trade war” recently.  So far two China tariff lists have already taken effect in July and August respectively and now there is a third one looming. And this one could be the one that affects your products.   

To give you a background, here are the lists of items covered in the three China Tariffs lists so far.  


Lists 1 and 2 have already taken effect in July and August of 2018 and if your product is listed that means that there will be an additional 25% duty rate on top of your current duty rate for products imported into the US from China.  

The third “$200 billion” list is proposed by Trump to face an additional 10% or 25% duty.  Talks are still underway and it’s uncertain when and if they will take effect.

There has been a lot of misunderstanding as to exactly how much the tariff will amount to.  To be clear this is an EXTRA 10% or 25% on top of the current duty that you’re paying.

For example, if your product’s HS code is mention on the above list(s) and you’re currently paying 5% duty prior to these new tariffs, and if the 25% passes now you will be paying 30% duties (5% + 25%)!

Not sure?  Ask your Customs Brokerage or Freight forwarder to clarify if they will be covered.  

To give you an idea of size of the impact of these tariffs… The three lists total about $250 billion in products.  This is about half of all China imports in 2017 according to US Census data.

What can you do?

1) Check if your products are affected by checking the HS Code.  As a best practice, you should check the accuracy of your tariff code with your customs broker.  


2) If you are affected and if you are it looks like it will be an extra 25% duty on top of what you’re already paying, decide how/if you can absorb the cost.

Some vendors say that they will pass the costs onto the consumer.  But there’s a big jump from a 10% increase versus a 25% increase. At 10% the cost, while painful, might be able to be absorbed by the customer, supplier, and retailer.  

At 25%, customers may vanish… along with your profits.  

3) The logical conclusion is to source outside of China but it’s easier said than done.  

Though countries in SE Asia and South Asia may not be prone to tariffs, it is often harder to find quality suppliers.  In many instances, labor costs may not be significantly cheaper than were once thought. In other instances, you may find that there is a lower productivity from suppliers outside of China.  

Besides that, there may be longer lead times for shipping in these other countries as their supply chains are not as efficient as the ones in China.  Furthermore, there may be additional hidden costs (graft, etc) in these other countries that will chip away at your dreams of finding a cheap supplier away from China.  

Ultimately this leads us to…

4) Dealing with Uncertainty

This is the only certainty.  That things with the trade tariffs and trade war will be UNCERTAIN.  Businesses now are holding back on investments because they are not certain what will happen after the midterm elections in the US.  

 

UPDATE June 18, 2018

On June 15, 2018, the US Trade Representative office released the list of items that will be hit with an additional 25% tariff or import duty.  

This initiative was spearheaded by Donald Trump and Robert Lighthizer in an effort to protect against China’s alleged unfair trade practices.

Here is the list of items affected

As you can see most of the items listed are not consumer goods which you typically find on Amazon. Instead it covers mainly items related to heavy industries such as aircrafts, vehicles, manufacturing related tools and equipment, as well as electronic components.  

According to the US Trade Representative Office – the idea is to counterbalance against the “Made in China 2025” initiatives and policies that China is using to push their homegrown technology and innovation.  

In summary:

  • The total value of this is $50 billion in 2018 trade figures
  • The tariff rate will be an additional 25%
  • “The list does not include goods commonly purchased by American consumers such as cellular telephones or televisions.”

Note that the items affected cover products imported from China only.  Products manufactured in and imported from other countries such as India, Vietnam, and Mexico are not affected by these policies.

How will this affect online sellers?

I conducted a completely informal survey of Amazon sellers, and the products they are selling are not affected.  But the key is in the details so check the list yourself.

Were your products affected by the new China tariff?  If so, what will you do about it? Comment below and let me know. 

—

In March of 2018, President Trump just signed a measure that the US will impose $50 billion in tariffs on Chinese imports.  Sources say that import duties on Chinese products will rise to a flat rate of 25% if the details of the measure come to pass (more on that later)!

Why is Trump doing this?

The answer is business and politics in my view.  

On one hand, Trump wants to reduce the US trade deficit with China.  They want China to purchase more US products: from airplanes, to resources like natural gas, to raw materials, food and beverages, technology, and pharmaceutical products.  

In addition, the US wants to nudge China to open up their market to US businesses.  There have been accusations that China is not playing by the rules they agreed when they entered the World Trade Organization (WTO) over a decade ago.   For example many feel that it is an unfair playing field for major US companies in China especially in the tech sector (Google, Facebook) and pharmaceuticals.  There are also concerns of lack of Intellectual Property protection and “technology theft” in China.

In short, the US wants China to allow more open access and play by the WTO rules they agreed to when they joined.  

So who will this affect?  

Potentially any businesses that import products from China.  This includes Amazon Sellers who source from China and ship those products to the US.  

They may face HIGHER import duties.  If you check with your customs broker you will find that most of your products have a duty rate in the single digits depending on your product.  So if your products are affected by the new laws then the import tax you will pay will skyrocket to 25%!

China is not taking this sitting down.  They are fighting back by imposing tariffs on US imports to China.  US Pork, wine, steel pipes, and recycled aluminum will face higher import duties in China as a result.

What products will be affected by the tariff?

The answer is it depends.

Right now it’s in the hands of US Trade Representative Robert Lightizer.  He has been appointed to review and submit a list of proposed products that will be affected by the tariffs by April 6, 2018.  

US Trade Representative Robert Lightizer

Following that will be a 60 day period of review and comment period.  “We’ll announce them before very long and then we’ll go through a 60-day period where we’ll give the public a chance to comment on the good and the bad things in there,” said Lighthizer.  

This means the earliest the new tariffs will pass is June 2018.

While we don’t know the details of the products affected yet, Lightizer claims that the affected products are “largely high-technology things” picked by a computer algorithm.  

Again we don’t know the exact details until Lightizer’s review and report but broadly speaking these are the major categories of Chinese imports into the US.   If I were to speculate then the categories near the top may fall within the “high technology things” he mentioned.

U.S. merchandise imports from China in 2017, by SITC product type, Statistica

What can you do as an e-commerce business owner?

Smart sellers are already diversifying their sourcing away from China.  They are sourcing products from Vietnam, India, and other countries.

However, before you say “Zai Jian (goodbye)” to China, remember sourcing and supply chain decisions aren’t solely made on price alone.

China’s manufacturing and export experience is quite mature now.  Compared to that, many of China’s manufacturing competitors may not be able to compete in various ways.  Beware that other countries may not be capable to manufacture the products that are made in China.

Also, their quality may be lower, their communications less efficient, and you may expect longer lead times as well.

But in all, “when the tide rises, all boats rise.”  Depending on the final details of the tariffs and if your product categories are affected, you and all competitors will be paying the new higher prices to import your product.  It’s going to be a level playing field for those importing from China. The US is just making China’s imports less competitive

Many sellers I’ve spoken to have decided that they will pass the costs onto their customers.

Recently I was contacted by Bloomberg and shared some of my thoughts from the Amazon sellers’ perspective: “On Amazon, more than half of product listings come from smaller businesses that source from China….and they would be hit hard.

“These guys are going to be left holding the new tariff bill and those prices will go straight up,” Huang said. “This year’s Christmas could be a lot more expensive.””