About Importation Business
I have been in the importation business for a while now, it’s been over five (5) years; give or take. And with the level of my success with this business, I can boldly pronounce myself as an expert, because I have seen all that should be seen in the business, I have seen the good, the bad, the ugly and the depressing part of the business.
Reflecting on my early days in the business, I decided to come up with a list of things I wish experts told me about the business before venturing into it. If I had known most of these things earlier on, it would have been very easy to scale the ladder and make huge income from the business within a very short time.
Most of what I knew about the business was more on trial and error, and a little bit of faith in trying out various options. I kept trying until I mastered the whole process, I did not just stop at that, I refined the process to make it more profitable.
Five years later, I have decided to share these with my readers, and hopefully it would help you jump start your importation career and maximize your time and profit right from the inception.
It should be noted that the following list is a compilation of the 6 things I consider very important in the business, it’s not an holy grail as other experts might have a different opinion, but here is my unbiased opinion.
Your success in the business depends solely on how good you are with numbers. The better you are in manipulating numbers, the more successful you will be. The main reason for this is not far-fetched; we are buying the goods in a currency (Dollar) different from ours (Naira). This is the main factor that determines how much you would sell your goods when it finally gets to Nigeria.
Many newbies choose a price for the good without considering the price of importation, the average selling price of the product in Nigeria and the profit margin after sales.
It’s one thing to know where to buy goods at cheap price online, to know how to ship it down to Nigeria, but it’s another thing entirely to understand the basis of sales and profit. I won’t just write about this without giving an insight into how to understand the “number games” of importation business.
Take for instance; you bought 10 pairs of sneakers from china at the rate of $10 per pairs, which would sum up into $100 for the 10 pairs of sneakers, let’s also assume the shipping cost for the sneakers is about $20 down to your front door in Nigeria, totaling $120 dollars in purchase, when you add the shipping cost.
Most newbies would probably convert $120 to naira (which is about #24000 as at the time of writing this post) and divide it by 10, to get the selling price of each shoes (which would be #2400 per shoes), so if you’re to make profit from your sales, you would have to add at least #200 to the selling price to make your own little profit, which will escalate the selling price of each sneakers to #2600 per shoe.
Now, let’s be realistic with our calculations, why would an average Nigerian buy a sneakers for #2600 when they can easily get the same type of sneakers in the local market for #1500 at most. So it becomes difficult to sell your items because you fail to consider the local selling price before importing the item, you fail to consider the dollar conversion rate and the shipping cost before you make your purchase online.
All these would affect your sales and would tie up your investment capital because it would take time and extra effort to sell of the items.
The question now is; how do you win the number game and master it as a newbie?
And my expert opinion is this: Learn the process from foot upward.
Learning the process from foot upward is simply re-engineering the process of importation business and making maximum profit from the process. As a seasoned importer, I have learn not to buy an item online because I think it is ridiculously cheap, I have mastered the game over time and I would share my buying process with you in few steps below:
- I scout for items online, and make a list of items I am willing to purchase.
- I search various stores and compare the price until I find the lowest price (This will be my assumed price)
- Then I’ll head out to local market and do a simple window shopping to get an average price of the product in our local market.
- I’ll then compare the price with that of the one I saw online, if the price difference is about 20-50% (take for instance the selling price online is $5 (#1000) and the selling price in the local market is #2000). I consider the item a good buy and I’ll proceed with the online purchase.
- If the price difference is as low as 5% and I have enough capital to import about 100 pieces, then I would also consider it a good buy because the gain from shipping cost would cover the remaining profit margin.
In case you don’t understand my explanation of the number games, please ask questions using the comment box and I’ll try my best to explain the more.
This is really simple, if you import the wrong item at the wrong period of the year, you wouldn’t sell as much compared to importing them at the appropriate time.
I once wrote a post on how to make #60,000 per month from importing customized wrist band; the post is a classic example of how seasonal the importation business can be. As a newbie, your first instinct is to find cheap item and buy them into the country, but expert instinct would always be “How fast would I be able to sell this item off?”, Because experts understands that tying up your investment capital is a bad idea when it comes to importation business, the idea is to buy at a cheap price and sell off as fast as possible then re-invest the capital.
Always compare your intended product with the current season; if the season is right and the product is cheap, then you should definitely go for it. If however one of the two factors does not agree with the other, then it’s not a good idea to invest your money in the purchase.
A brief idea of seasonal product would be the importation of wrist band during festive period, or importation of flat shoes in September/August when school resumes for another session.
Most self-acclaimed experts wants to sell off their “info-material” as fast as possible, as as a result, they would go into any extent to sugar-coat the importation business. Many of them will tell you how fast and easy it is to make money from the business, without telling you the processes involved.
In their bid to make you get their eBook, often they would forget to ring it out loud, that just like any other business, both offline and online, it takes a considerable amount of time to understand the basis and it also take additional time before you make decent income from your effort.
In importation business, a larger percentage of your early days would be a learning period for you, it would be a period of establishing your customer base, and as you know already, it takes time you gain customers trust, but when you do, you would have them calling you for special purchase.
In my expert opinion, when you’re about to venture into the business, do so with the mindset of investing time, and don’t think you would make money almost instantly, No! It takes time.
PS: Speaking of E-Book, here on importationwealth.com I have a great resource on how to import product from China at a ridiculously cheap price, Most of our readers have good testimony about the guide and hopefully, you’ll also have the same testimony after reading it.
And of course, IT’S FREE!
So click here to download the eBook, or leave your email in the comment box and I’ll get it across to your email
In life, we’ve been wired to see failure as a very bad thing, as a matter of fact, a larger percentage of us see failure as a very bad thing, and they see it as the end of the world. Because of this general believe, most expert would choose not to tell you about the possibilities of failing as an importer, because they think it might change your perspective about the business, and discourage you from venturing into it.
On the contrary, failure should be a motivation rather than a discouragement. Learn to embrace failure and you would have no limit in life.
Relating this philosophy to the importation business, It’s important that you agree with me on the fact that, your early days would be threatened by failure, failure on various ends, failure on getting customers to buy your goods, failure on buying the right goods, failure on the number games, loss of money, and poor profit margin, the failure might be from any of the processes involved in the business.
MUST READ: 5 Attributes an Importer Must Posses.
But once you’re prepared for it, no matter how bad or huge the lapses are, it won’t discourage you, but rather it would motivate you to invest more time and effort in learning about the business.
There is a popular saying which goes thus: Successful people don’t see how many times they’ve failed, but rather they see how much better ways they can do things.
In real word, the general believe is that there is no shortcut to doing things… In the importation business, there are shortcuts! As a matter of fact the more shortcuts you know, the higher your chances of making more profit.
It should be noted that, when I said shortcuts; I am not talking of dubious ways of doing things, on the contrary, I am talking of faster ways to get things done without invest much time and effort.
Most experts won’t tell you about this shortcut because it’s what makes them an expert, the shortcut is their key to success and they would go extra mile to ensure that you don’t know about them.
I would share a few shortcuts with you, and would allow you to discover others on your own.
You can outsource your online purchase and shipping to various companies and the focus on searching of product and selling only.
There are companies in China that would handle the purchase process for your when you send the link to them, they would do the purchase, repacked everything and send it to you in a box. This process would save you the headache that comes with the fluctuating exchange rate, and also give you more time to focus on other aspect of the business.
Most expert would never tell you about these companies, they would rather show you how to do it, which might be a good thing, but when stress yourself when there are companies that can make the process easier by paying them a token which you can spread on your selling price and still make reasonable profit.
I am working on a list of third party shipping companies, and would link them to this post when I am done with the compilation.
Selling and Buying
The success of this business depends on buying and selling process. The cheaper you buy, the higher your profit. The faster you sell, the larger your business becomes.
Most experts would show you where to buy most of these goods; some would not even tell you about secret stores where you can buy items at a cheaper price.
As with the selling, I have made a compilation of places where you can sell your items in Nigeria, read these posts
In conclusion, it’s important to take note that my opinion in this post is not in any way a yardstick that determines whether you success or fail in your importation career, following them would however give you a head start and making this much easier for you as you progress.