When you’re first starting out in business, it can be tempting to source the cheapest inventory possible so you can get off the ground for less. While this is a completely understandable desire, it can cause some pretty significant issues if said cheap inventory is purchased from overseas suppliers. Today, we’ll be exploring those risks to help you circumvent the issues that might otherwise arise.
The biggest risk you face when purchasing inventory from overseas is that it won’t be compliant with your country’s rules and regulations. This can land you in some pretty hot water just for stocking the items, but can also void your insurance and even earn you a trip to the state penitentiary if something goes wrong with one of your products. This is particularly worrying if you’re in any field that deals with health, so be sure to quadruple-check that you’re dealing with a reputable supplier before purchasing medical supplies online.
Though the consequences are less dire, minor quality issues can also be a problem for your business. While you’re not likely to land in jail if your products don’t last as long as a higher quality item, your reputation will certainly suffer, and you won’t receive many return customers if your offerings are clearly cheap and nasty.
Incompatibility With The Rest Of Your Customers’ Set Up
Another problem to consider is the possibility that stock from overseas will not be compatible with your local electricity supply or other items that your customer would like to pair the product with. This may mean that you will either have to reduce your retail price to account for the fact that your products will not be comparable with other options. Alternatively, you may need to provide an adapter to make the product suitable for use, which will also cut into your profit margins.
Of less concern, but still annoying, shipping delays can cause plenty of problems when acquiring inventory from overseas. This is particularly pertinent in the post-pandemic world as the crisis has made an absolute mess of most shipping channels. Delays are now par for the course if your stock has to cross an ocean or two to get from the manufacturer to you.
Once your inventory makes it to local shores, you may think your problems are over. You’ve ensured that they’re of the appropriate quality and comply with any relevant laws, so what could go wrong? Unfortunately, there’s a very real chance that you’re about to be slapped with some pretty large customs charges. These will need to be considered when deciding on the retail price of your offerings and also when comparing which supplier offers the best deal.
Finally, once your inventory has made its trek to your country and you’ve paid the customs charges to have it released, it may be subject to a holding period in a quarantine facility. The quarantine can be quite costly and creates further delays with stock, so you’ll need to factor this into your budget and inventory tracking.
Purchasing inventory from overseas suppliers can be great for getting a cheap deal. If done properly, it can help you get your business up and running while also building strong global partnerships, but you need to be careful to avoid these six risks. Ensure that you always do your due diligence, and if you’re unsure, remember that it’s better to be safe than sorry. Good luck with your business and happy sourcing.