Am i allowed to do such business (Australia version)?
Post 1 of 17
Hi posters!
I looked at this post and it is exactly what some mates on Australia are thinking:
http://resources.alibaba.com/topic/231264/Am_i_allowed_to_do_such_business_.htm?message=320616
Basically, the question is if you can, as an individual (not business), import products from China and resell on Australia on a small scale / basis.
I did some research and I know these facts:
1. Customs would not require a formal custom declaration if the values of the shipment is below 1000 AUD and is carried by post. Lots of information on http://www.australia.gov.au/Import_&_Export and http://www.customs.gov.au/site/page.cfm?u=5549
2. If you want to open a business website, you must register it with the government.
3. As an importer, you are liable for any damage that the product can do to any individual. Insurance is encouraged.
4. Must watch for intellectual property infringement. Big issue with chinese products.
I have a little experience on importing products on another country, but it was a lot different. I did it by hobby but now I want to do it more formally. My previous experience was that if you are small business or person you can take advantage of your situation and be very quick to take new and innovative products to the market, as many large companies are massive but slow. Do not try to import brand names, instead, likely-products but a lot cheaper. The biggest problems where searching for a good supplier and the warranty responsibilities, then spammers, frauds ... anyway, these can be solved by researching on other posts that are already on this forum.
Can any Aussie or worldwide experienced guy(s) give us more information about this? Which way should we take?
Thank you very much for your replies. If any australian mate has or is going through this experience, I will be happy to share knowlegde!.
I looked at this post and it is exactly what some mates on Australia are thinking:
http://resources.alibaba.com/topic/231264/Am_i_allowed_to_do_such_business_.htm?message=320616
Basically, the question is if you can, as an individual (not business), import products from China and resell on Australia on a small scale / basis.
I did some research and I know these facts:
1. Customs would not require a formal custom declaration if the values of the shipment is below 1000 AUD and is carried by post. Lots of information on http://www.australia.gov.au/Import_&_Export and http://www.customs.gov.au/site/page.cfm?u=5549
2. If you want to open a business website, you must register it with the government.
3. As an importer, you are liable for any damage that the product can do to any individual. Insurance is encouraged.
4. Must watch for intellectual property infringement. Big issue with chinese products.
I have a little experience on importing products on another country, but it was a lot different. I did it by hobby but now I want to do it more formally. My previous experience was that if you are small business or person you can take advantage of your situation and be very quick to take new and innovative products to the market, as many large companies are massive but slow. Do not try to import brand names, instead, likely-products but a lot cheaper. The biggest problems where searching for a good supplier and the warranty responsibilities, then spammers, frauds ... anyway, these can be solved by researching on other posts that are already on this forum.
Can any Aussie or worldwide experienced guy(s) give us more information about this? Which way should we take?
Thank you very much for your replies. If any australian mate has or is going through this experience, I will be happy to share knowlegde!.
04 Dec 2007 01:50
Post 2 of 17
Replying to [australmex]:
Hi, good post.The $1,000 cap depends on the sort of goods and perhaps you are referring to only the usual 5% import duty.
For example, if you import a cheap ATV costing say $500 you must have an Import Permit because it is classed as a vehicle.
Or if you import any electrical device whatsoever (except battery powered stuff) for resale, whether above or below $1,000, you must have various lab certificates and obtain permits to resell the stuff.
Customs does not check those certifications but other Government Departments will skin you alive if you try to resell uncertified stuff ... even seemingly harmless things like mains power light bulbs and electrical adaptors and cables.
Same applies to anything emitting radio waves (of which there are many sort of devices).
And, etc, etc, etc.
However, Customs will seize and destroy fake big brand name stuff in which respect the big corporations work very closely with Australian Customs.
![[em1]](http://img.alibaba.com/images/eng/style/icon/emoticons_smile.gif)
Hi, good post.The $1,000 cap depends on the sort of goods and perhaps you are referring to only the usual 5% import duty.
For example, if you import a cheap ATV costing say $500 you must have an Import Permit because it is classed as a vehicle.
Or if you import any electrical device whatsoever (except battery powered stuff) for resale, whether above or below $1,000, you must have various lab certificates and obtain permits to resell the stuff.
Customs does not check those certifications but other Government Departments will skin you alive if you try to resell uncertified stuff ... even seemingly harmless things like mains power light bulbs and electrical adaptors and cables.
Same applies to anything emitting radio waves (of which there are many sort of devices).
And, etc, etc, etc.
However, Customs will seize and destroy fake big brand name stuff in which respect the big corporations work very closely with Australian Customs.
04 Dec 2007 03:03
Post 3 of 17
Replying To [australmex]:I fully agree and endorse what Aussie says above.
Another VERY IMPORTANT factor here is that under Australian law, YOU, the importer, are deemed to be the Manufacturer.
In other words, if the customer in Australia wants to give you the goods back for whatever reason, (faulty, wrong colour, wrong anything or whatever) and wants a refund, under Australian law, you are obliged to do so, irrespective of whether the manufacturer will agree to refund you or not.
IF there is a major problem, and the government requires you to do a recall on the product, it is at YOUR expense.
04 Dec 2007 03:23
Post 4 of 17
Replying to [australmex]:On ant idea,But i want to know how to find the marketable items in another country?
05 Dec 2007 02:55
Post 5 of 17
Replying to [Aussie]: Thank you very much for your reply mate! I looked at lots of your posts and your replies and posts are always a help.
About the 5% import that you mention, here is the quote from http://www.customs.gov.au/site/page.cfm?u=5549
"All goods (except for tobacco products and alcoholic beverages) may be imported duty and tax free if their value is $1,000 or less." I think this for all imports above 1,000, am I missing something? That link is from "Buying over the Internet" customs pages. It has not information if "buying from the internet" means from sites like ebay or alibaba, so I am just assuming is for all kind of purchases.
You mentioned something about laboratory certificates on electrical devices and devices emitting radio waves, do you know where can I found more information? The first product that is on my mind is a battery powered device from china, so I will have to do more research on that matter.
"However, Customs will seize and destroy fake big brand name stuff in which respect the big corporations work very closely with Australian Customs' ... wow that must be a difficult job. I daily receive a catalogue of mp3 units from china and they seem a lot like ipods and other renamed brands. Perhaps they are just searching from counterfeits (fake devices with major brand logo on it)?
Thank you again!
About the 5% import that you mention, here is the quote from http://www.customs.gov.au/site/page.cfm?u=5549
"All goods (except for tobacco products and alcoholic beverages) may be imported duty and tax free if their value is $1,000 or less." I think this for all imports above 1,000, am I missing something? That link is from "Buying over the Internet" customs pages. It has not information if "buying from the internet" means from sites like ebay or alibaba, so I am just assuming is for all kind of purchases.
You mentioned something about laboratory certificates on electrical devices and devices emitting radio waves, do you know where can I found more information? The first product that is on my mind is a battery powered device from china, so I will have to do more research on that matter.
"However, Customs will seize and destroy fake big brand name stuff in which respect the big corporations work very closely with Australian Customs' ... wow that must be a difficult job. I daily receive a catalogue of mp3 units from china and they seem a lot like ipods and other renamed brands. Perhaps they are just searching from counterfeits (fake devices with major brand logo on it)?
Thank you again!
06 Dec 2007 00:56
Post 6 of 17
Replying to [grigo]: Thank you for your reply mate!
Initially, I have in mind to sell the goods on a minor scale such as ebay or with friends to do a "market trial". On such places, you can specify the the terms of the warranty (you can see a lot of "As is" on some pages), obviously this can retract many costumers so I will offer warranties and negotiate that with the Chinese exporter, but, may not offer "change of mind" refund. I have seen this on some docklets on some small shops.
That would be a good follow-up for me, do you know where can I find more information for this? I did some research on that subject and found "Small business and the Trade Practices Act" on the fair trading laws page from the government website; but I dont know if I have to follow all those business laws as I am just an individual (There are some obvious laws to follow like piracy, etc.). I will try to picture this with an example: if you have a new or used car store, you have to follow the business rules for that sector, but when you are selling your old car to another individual, not all the same rules apply to you.
About the risks of doing this I think I can handle them, I will start with a small investment (I think about a 1000 is a good trial) and have in mind that I can lose it all, but, with luck, be the starting of something good.
Initially, I have in mind to sell the goods on a minor scale such as ebay or with friends to do a "market trial". On such places, you can specify the the terms of the warranty (you can see a lot of "As is" on some pages), obviously this can retract many costumers so I will offer warranties and negotiate that with the Chinese exporter, but, may not offer "change of mind" refund. I have seen this on some docklets on some small shops.
That would be a good follow-up for me, do you know where can I find more information for this? I did some research on that subject and found "Small business and the Trade Practices Act" on the fair trading laws page from the government website; but I dont know if I have to follow all those business laws as I am just an individual (There are some obvious laws to follow like piracy, etc.). I will try to picture this with an example: if you have a new or used car store, you have to follow the business rules for that sector, but when you are selling your old car to another individual, not all the same rules apply to you.
About the risks of doing this I think I can handle them, I will start with a small investment (I think about a 1000 is a good trial) and have in mind that I can lose it all, but, with luck, be the starting of something good.
06 Dec 2007 01:31
Post 7 of 17
Regardless of what the Trade Practices law may say about refunds, you will find that customers will expect a certain consistency with the norm here.
It is pretty standard for products to have at least a 12 month factory warranty. In the case of electrical goods most legitimate suppliers will offer you a 12 month warranty but this won't help you too much as the warranty will require that you send the goods back to China for repairs. So for all intents and purposes, if you want to retain any sort of professional reputation as you grow your business then you are going to have to accept the costs of replacements and repairs of product. You can then take the matter up with your supplier and see if you can get any of that back. You can't expect your customer to just see what they can get from your supplier. You should expect to have to offer repairs or refunds on faulty product or product supplied that differs from how it is represented. I don't believe that there is any law that requires you to refund should people change their mind!!
Your plan seems reasonable, but I am not sure how feasible it will be profit wise as courier costs are high and are not going to go down!! You will not be able to buy from suppliers and will instead need to purchase through trading companies in China. That is not a huge problem but will result in higher prices for you.
I think your biggest problem is going to be incompetant suppliers - of which China has more than their fair share. If you are importing lots for sale rather than for stock then you are going to be on a tight time frame. Delays from the supplier could result in problems with supply your end which in turn could lead to reputation problems. My advice would be to never sell any product that you don't already have in hand in Australia unless you want to risk letting your customer down.
Finally, quality is going to be your biggest single concern. The best plan is to have someone here on the ground to check quality before it ships but on such a small scale this is not ecomomically feasible. So you are going to have to chose your suppliers VERY carefully.
It is pretty standard for products to have at least a 12 month factory warranty. In the case of electrical goods most legitimate suppliers will offer you a 12 month warranty but this won't help you too much as the warranty will require that you send the goods back to China for repairs. So for all intents and purposes, if you want to retain any sort of professional reputation as you grow your business then you are going to have to accept the costs of replacements and repairs of product. You can then take the matter up with your supplier and see if you can get any of that back. You can't expect your customer to just see what they can get from your supplier. You should expect to have to offer repairs or refunds on faulty product or product supplied that differs from how it is represented. I don't believe that there is any law that requires you to refund should people change their mind!!
Your plan seems reasonable, but I am not sure how feasible it will be profit wise as courier costs are high and are not going to go down!! You will not be able to buy from suppliers and will instead need to purchase through trading companies in China. That is not a huge problem but will result in higher prices for you.
I think your biggest problem is going to be incompetant suppliers - of which China has more than their fair share. If you are importing lots for sale rather than for stock then you are going to be on a tight time frame. Delays from the supplier could result in problems with supply your end which in turn could lead to reputation problems. My advice would be to never sell any product that you don't already have in hand in Australia unless you want to risk letting your customer down.
Finally, quality is going to be your biggest single concern. The best plan is to have someone here on the ground to check quality before it ships but on such a small scale this is not ecomomically feasible. So you are going to have to chose your suppliers VERY carefully.
06 Dec 2007 01:45
Post 8 of 17
Replying to [Greenbird]: Greenbird, I did not understand your question very well so I will reply to "But i want to know how to find the marketable items in another country?"
For me, is just 2 basic ideas:
1. Find a product that is not on the country and it will be highly demanded (because it is a novelty, people require the item for along time and it was unavailable, etc.).
2. Find a product that is on high demand, but it is expensive and you can bring a replacement (not counterfeit!) of this commodity with a really cheap price with acceptable quality (you may sale one product with bad quality but people may just return it or never buy from you again).
To find these, is just only one way: research. You can do it by yourself or pay someone to do this for you (large firms can bring this information for lots of money). If you are on your own, you can step in on the major stores and see it by yourself or if you are away from the country, do a lot of research on Internet (news, websites, on-line stores, forums). You can also watch for new products and see if those will be demanded on another country. Have in mind basic things like average income, culture, customs, etc. Also, some countries will have high taxes on foreign products because they are in direct competition with the domestic ones.
Hope that this helps.
For me, is just 2 basic ideas:
1. Find a product that is not on the country and it will be highly demanded (because it is a novelty, people require the item for along time and it was unavailable, etc.).
2. Find a product that is on high demand, but it is expensive and you can bring a replacement (not counterfeit!) of this commodity with a really cheap price with acceptable quality (you may sale one product with bad quality but people may just return it or never buy from you again).
To find these, is just only one way: research. You can do it by yourself or pay someone to do this for you (large firms can bring this information for lots of money). If you are on your own, you can step in on the major stores and see it by yourself or if you are away from the country, do a lot of research on Internet (news, websites, on-line stores, forums). You can also watch for new products and see if those will be demanded on another country. Have in mind basic things like average income, culture, customs, etc. Also, some countries will have high taxes on foreign products because they are in direct competition with the domestic ones.
Hope that this helps.
06 Dec 2007 01:49
Post 9 of 17
Replying to [Egernia]: Wow Egernia, a very good answer. Now this topic is getting in real shape. After reading your post, a good conclusion would be:
1. Quality is the biggest concern. If possible, do a quality ground check with an agent (agents can be found on posts).
2. Buy from a trader, not from suppliers (as for the small quantities to buy).
3. When making the overall budget considerate warranties / replacements / etc. Returning products to supplier is not a real option.
4. Buy lots for sale only, not for warehouse. (a garage is not a warehouse!). Sale them only when you have them.
5. Speed is an issue. I think this can be solved by using fast shipping as air parcel and buying small and light commodities (for example, calculators).
6. Assume the risks of doing this, as with any business. Go with due diligence.
7. A very important and very, very repeated point: do not buy counterfeits / illegal stuff from china! You will be taking part of a fraud or just a victim from it.
Any additional points or updates to these?
1. Quality is the biggest concern. If possible, do a quality ground check with an agent (agents can be found on posts).
2. Buy from a trader, not from suppliers (as for the small quantities to buy).
3. When making the overall budget considerate warranties / replacements / etc. Returning products to supplier is not a real option.
4. Buy lots for sale only, not for warehouse. (a garage is not a warehouse!). Sale them only when you have them.
5. Speed is an issue. I think this can be solved by using fast shipping as air parcel and buying small and light commodities (for example, calculators).
6. Assume the risks of doing this, as with any business. Go with due diligence.
7. A very important and very, very repeated point: do not buy counterfeits / illegal stuff from china! You will be taking part of a fraud or just a victim from it.
Any additional points or updates to these?
06 Dec 2007 05:33
Post 10 of 17
UPDATE:
I am just returning from the Australian Post office, I asked for the maximum weight that we can receive from overseas and it is 20 kg.
Quoting my previous post: "1. Customs would not require a formal custom declaration if the values of the shipment is below 1000 AUD and is carried by post." Looking at the http://www.customs.gov.au/site/page.cfm?u=5549 page, says that any carrier other than post can do this if they can fill the SAC (Self Assessed Clearance). I have seen on another posts that such companies do that but charges a lot for filling the SAC.
After some replies on this post, I suddenly have the feeling of needing a partner to share costs, risks and benefits. As you can see on this post, it is more for a small business and overall a learning process. Any mate interested? Just reply to this post!
Cheers!
I am just returning from the Australian Post office, I asked for the maximum weight that we can receive from overseas and it is 20 kg.
Quoting my previous post: "1. Customs would not require a formal custom declaration if the values of the shipment is below 1000 AUD and is carried by post." Looking at the http://www.customs.gov.au/site/page.cfm?u=5549 page, says that any carrier other than post can do this if they can fill the SAC (Self Assessed Clearance). I have seen on another posts that such companies do that but charges a lot for filling the SAC.
After some replies on this post, I suddenly have the feeling of needing a partner to share costs, risks and benefits. As you can see on this post, it is more for a small business and overall a learning process. Any mate interested? Just reply to this post!
Cheers!
06 Dec 2007 18:39
Post 11 of 17
Replying to [australmex]: I am an Aussie based in China. I think that it would be worth us having a chat about this to see if there is a way that we could co-operate. I think that we could really compliment one another. Contact me via the Trade Manager by clicking on the icon below my profile on the right.
06 Dec 2007 22:22