For people who have been doing drop shipping for some time, they must know the best countries for their business. And among that list, China is always not ranked. Have you ever wondered why China, such a densely populated country, contributes almost no growth to your turnover? In today’s article, I will show you 10 reasons to explain why drop shipping to China is a really, really bad idea.
1. Product Price
We all know the labor cost in China is not as high as that in developed countries, and there are numerous manufacturers all over the country. With easier access to these factories, the product price is usually quite fair for consumers. That means a low profit margin for your products.
2. Product Diversity
Still, people can find various and original products in China because of these numerous manufactuers.No products is unavailable here and your products will lose its uniqueness and are hard to grab the market share.
3. Shipping Costs
The shipping network is highly developed in China, consumers can always have multiple choices with a low cost for their purchased goods. People in places like Jiangsu, Zhejiang and Shanghai even can enjoy free shipping most of the time. It’s difficult for you to beat the price.
4. Delivery Time
If you ship globally and from outside of China, it usually takes at least three days for your items to be delivered. However, if Chinese people buy things online from domestic platforms, sometimes they can have them the next day when they place the orders. Let alone the time for preparing goods when it comes to dropshipping.
5. Shopping Platforms
Aside from buying from physical stores at a fair price, please still can choose to buy with an even cheaper price from online shipping platforms. Some popular online shopping platforms in China, such as Tmall and Jingdong can provide you with quality stuff and excellent shopping experience. Why would they bother to buy things from unknown stores?
6. Customer Experience
When shopping on the platforms mentioned above, people can have a wonderful customer experience. Before ordering, they can ask customer service staffs questions and often get an immediate reply. After receiving the products, they can change it for a different size or color and finish it within a short period of time. They can even return the items without reasons and any cost.
7. Customs Issues
First, China Customs impose a higher duty, about 3.5% more than other countries. Second, China has been intensifying its Customs policy which leads to a higher chance of spot check and longer clearance time. You may pay more but still dissatisfy your customers.
8. Language Barrier
Yes, English is a universal language. However, that does not mean all Chinese can speak it. Also, I am sure you may know about how hard it is to learn Chinese. Then how should the conversation go on if the speakers share no common language?
9. Payment Methods
The most popular micropayment methods in China are WeChat Pay and Alipay, which is not supported in most foreign e-commerce platforms. Besides, the popular UnionPay credit cards in China are not accepted for the payment.
Most international settlement uses USD as the payment currency. And there is no point even if you accept other currencies (unless it is Chinese Yuan). Since China has strong control over foreign exchange, there is an amount limit if people choose to pay it with their credit cards.