GUIDE TO MONEY-MAKING VIA IMPORTING FROM CHINA

1.         DECIDE WHAT YOU WANT TO SELL/IMPORT

The very first step to any serious means of making money is to decide what exactly you want to do to make that money. While one person will want to sell clothes on his way to money-making, the other person might want to sell shoes. It is the same with the game of importing, you as the intending importer must first decide what exactly you intend to import and sell in Nigeria to make money.

The reason why importing goods from overseas is quite profitable is that majority of the products being used by Nigerians are not produced here in Nigeria, thus when you purchase such products in the open market, you have helped the importer of such product make certain profit. For example, you still find that items as common as pencil are still being imported into the country this means that the actual price of it would not have been up to that #10 you buy it had it been it is being produced in Nigeria. It could be around #3 while the importer takes the other #7. Importing is that profitable!

This first tip requires that you decide what you believe you can sell given the nature of the environment in which you live. Your choice might also be affected by whether or not the product you intend to import is being produced in Nigeria. If it is, your imported goods might be a little more expensive than those produced here. When you have decided what you want to sell, find out the nature of the market for such goods. You ask the question, is there always a ready market for this product I am about to import? The market also goes a long way to affect your choice.

2.         VISIT ONLINE TRADING SITES TO CONFIRM PRODUCT DETAILS

  After deciding the product you intend to import taking into consideration the available market for such product(s), the next thing to do is to get the product details from online trading sites. These trading sites are links through manufacturers advertise their products to intending buyers. One of such trading sites is www.alibaba.com where you can obtain almost every product detail you need.

The truth remains that majority of the product being used in the world today are being manufactured in China. I do not know the exact reason for this, but I believe it is because China has cost-effective production techniques that helps lower the cost of the final product. It will surprise you to know that even most of the goods being imported into the country from western countries are being produced in China and the imported to those countries then re-imported to Nigeria explaining the reason why most goods imported from western countries are always quite expensive.

Having already understood the fact that China is the production hub for most goods, I find it easier for me to get the details of any product I intend to import not by directly browsing Alibaba, but going through the Google.com search engine. Let’s say I have decided to import erasers, I will simply go to www.google.com and enter ‘price of erasers in china’. Often, the topmost result the search will bring is a link to Alibaba.com and all you need do is click that link.

Alibaba will in turn bring you a list of eraser manufacturers in china i.e. erasers by different companies and in front of each type, there will be the price and something like MOQ, this actually means Minimum Order Quantity which is the least amount you can buy from that company. This information will help you determine the actual price of the product there in China and what it will amount to eventually adding cost of shipping and import duty.

Say the minimum order quantity is 1,000 packs, and the price per pack is $2.3, then the total amount you will pay for the goods to the manufacturer is $2,300, somewhere around #368,000. That gives you the price of the commodity and this is the basic information you need to decide if you will purchase the product. If you decide to purchase then, you go ahead and contact the manufacturer through a link that would have been provided in front of the product details to determine the cost of shipping and other factors like branding. By branding I mean the name the manufacturer will crest on the product for you. If you will be importing 1,000 packs of a product, the usual practice in China is to help you crest your own business name on it such that you sell under your own business name.

3.         RAISE THE REQUIRED CAPITAL + DUTY

          Having determined the cost of the goods payable to the manufacturer (cost + shipping), the next thing to do is raise the capital required. However, the total amount paid to the manufacturer guarantees that your goods will be sent from China but it does not guarantee that they will be delivered to you in Nigeria. You ask why is it so? The answer is simple, after you decide the product to order, you must confirm whether the product is not on the Import Prohibition List of the Nigerian Customs Service. The import prohibition list is a list of goods that are not allowed into the country. It means, if you import such products, they will be impounded at the port.

          So long your product is not on the prohibition list your goods will be released to you after the payment of a fee called the Custom Duty. The custom duty comprises an average of 12% import duty on the total cost of the goods, a surcharge of 7% on import duty and a valued-added tax of 5% on the total i.e. import duty + surcharge. I advise you visit the Nigerian Customs Service office to confirm the figure for the custom duty payable to them so you can get the exact figure, but what I gave above is about the estimate of it.

          Thus, let’s say the total cost of the product (price + shipping) is #400,000 (i.e. the company charges you a shipping cost of #32,000), then by the estimated duty figures above, you will pay an import duty of #48,000, a surcharge on import duty of #3,360 and value-added tax of #2,568. That should make a total custom duty of #53,928. Hence the total cost of your good that will get it to Lagos and clear it for you at the port is #453,928. Adding the cost of transportation of the goods from Lagos to your destination, say #60,000, the total cost of the goods becomes #513,928. This means that each pack of the product costs #513.928k. This figure will help you decide how much will be the selling price you will charge per pack. However, you should have calculated all these before ordering the product, infact it should be part of your buying decision as it will not be wise if the eventual cost is higher than products of its like in Nigeria (even though it is rarely so), remember, your main aim for importing is to sell cheaper products that will boost your sales.

         

4.         ORDER THE PRODUCT

          Having done all the calculations as shown above with sound information from the manufacturer and customs, and you have determined the cost per unit of the product upon delivery and found it profitable, you have then received a green light to order the product and pay your manufacturer by any means which you both agree on. You should not by any means order a product which you have not carefully calculated its cost implication upon delivery and the price advantage it will have over other existing products.

Money-Making Tips: Here you are!

Here on imoneynigeria.blogspot.com, the I-Buck resources team which I am proudly the C.E.O, shares with you, secrets to making and keeping money. These secrets, fondly called 'tips' by us, can be your door-way to exceeding wealth.
I humbly advise that you take our tips to heart and contact us for any contributions and enquiries.

Oderinu A.
C.E.O. I-buck Resources

5 TIPS TO HELP AVOID DISCOURAGEMENT IN ENTREPRENEURSHIP

Most entrepreneurs see funding as the greatest problem to their dream of becoming a fulfilled entrepreneur. I use to belong to this school of thought and infact, I formerly had this staunch belief that if only I could get money, then my entrepreneurial dreams will be fulfilled to maximum. In this article, I am going to share with you, five (5) basic factors that influence entrepreneurial success a little bit more than funding. These factors embedded in the five (5) tips I am going to give you, are somewhat more psychological in nature, but you should know that the basis of success for any enterprise is the psychological condition of the entrepreneur.

1.         TRY TO AVOID BORROWING FROM FAMILY

          This might sound to you somewhat strange, especially since one of the sources of business financing is from family and relatives. However, looking at the psychological trauma of attempting to borrow from family, it might outweigh the merits inherent in it.

          The first issue is, your entrepreneurial creams are most probably understandable to you alone, and other people might not share your view. Thus, a relative or family you are attempting to borrow from who does not share your view will definitely attempt to discourage from taking that leap of faith that your ideas require. You could avoid listening to outsiders who do not share your view, it is sometimes very difficult to avoid the psychological problems attached to your family member’s disapproval of your idea.

          Eventually, apart from not giving you the capital you require, a relative might have dampened your enthusiasm by his inability to see the bright side that you are seeing, maybe because he knew you from when you were little and finds it hard to believe you are capable of executing the plans you have. So, as a rule of thumb, try as much as possible to avoid borrowing from relatives and family except the person really BELIEVES in you and will approve of anything without saying pessimistic things.

2.         IGNORE THE FACTS AND DO YOUR BEST

            There are numerous entrepreneurial facts in the present day world. These facts ranges from the inability of nine (9) out of ten (10) businesses to survive after five (5) years which is a global fact, to the increasing difficulty in accessing credit facility for business start-up etc.

          If you intend to face the fact that 9 out of 10 businesses in the world fold up after 5 years, you would find no reason to continue on your quest to become a successful entrepreneur forgetting the truth that yours could be the 1 business that will survive out of the 10 in your area if only you put in your best. The fact that access to credit facility is fast becoming impossible for upcoming entrepreneurs can also make you forget your ideas, at least what is an idea with no capital.

          However factual the above information might sound, it also presents the fact that only 10% of businesses survive after 5 years. I tell you very sincerely that by giving your best to your idea, you could make that 10%. If the credit facility is not available as huge as you would want it, you could start small with that little that you have and grow with it learning on the job.

3.         YOU STAND A BETTER CHANCE WITH YOUR OWN MONEY

          The tips 1 and 2 above stress the fact that a lot of discouragement can spring from trying to borrow from your family and relatives, as well as believing the global facts. The basic tip that helps you avoid the pitfall as enumerated in 1 and 2 above is to utilize your own money to start.

          The first advantage of using your own money is that you will be fired up to work harder since you do not want your hard-earned capital to go to waste. The second advantage of using your own money is the fact that you are not placed under any unusual tension of re-payment that might frustrate your entrepreneurial ideologies. The last advantage of it is, since you are just starting up, it is highly likely that you can not afford a lot of money as your take-off capital, thus, you are forced to utilize the little capital available, making you start small and starting small then growing and learning on the job, is the ultimate lesson for an entrepreneur.

4.         AVOID JEALOUSY AND ENVY

          In your race to become successful as an entrepreneur, it is quite common to find other people in the same line of entrepreneurship doing better than you are. If you decide to sell clothes, you soon discover someone very close by doing extremely better than you in the sales of clothes. In this situation, the immediate human tendency is to start feeling jealous and envious. This will not do you any good, it will only discourage you from continuing.

          When you discover an entrepreneur doing better than you, there are only a few profitable options available to you. You either learn from the person, or concentrate on making your business successful without measuring the success of others. In entrepreneurship, jealousy and envy will only lead your business into the 90% failure group.

5.         DO NOT BITE MORE THAN YOU CAN CHEW

          It is true that you are a capable entrepreneur who knows his onions. But, I believe, that each human has a certain limit to his capability per time. This limit is often set by the enormity of our experiences. The capability of a 5 year old child, is not anywhere comparable to that of a 30 year old man so long he’s not an imbecile. So also, the capability of an entrepreneur who has been in the game for 30 years is higher than that of one who started yesterday. This limit is determined by their experiences.

          It would therefore amount to sheer madness for a fresh entrepreneur to attempt to start at the point where the 30 year old entrepreneur is, the result will be frustration, discouragement and will be catastrophic in nature. So, as an entrepreneur, you must seek to understand the limit of your capability at different points in time so that you may understand ideas that are currently beyond you and those you are capable of handling. I tell you, the brilliance of an entrepreneur is measured his ability to differentiate the ‘sensible’ from the ‘gamble’. Whereas a sensible venture will bring profit, a gamble will bring discouragement, bite only what you can chew.

For some more counsel, read my article on THE EXPECTATIONS OF A GRADUATING STUDENT AND WHAT THE NIGERIAN ECONOMY HAS IN STOCK FOR HER DISCIPLINE.