"Made in China" is a tag that most American consumers are familiar with. Asia has long been a great source of merchandise, ranging from toys to electronics to jewelry, apparel and accessories. As of October, 2008, China ranked as the second largest exporter to the United States at $284.4 billion in sales, according to the U.S. Census Bureau. Japan ranked fourth at $119.4 billion in goods. In addition, Vietnam, India, Pakistan and Indonesia have all increased exports to the U.S., which means more variety and more availability for U.S. wholesale buyers.
Why are Asian products so sought-after? For decades, Asia has been known for its attractive pricing, but currently, the benefits go much further, and include diversity of products, customization, fast turnaround and ease of doing business. These factors, combined with the tightened economic climate, make buying from Asia cost effective for many buyers.
"The real strength of Asia is that there is very little that can't be sourced from there," says Danny Kole, president of Carson, Calif. based Kole Imports (www.koleimports.com), a supplier to the dollar store community. Today, he says, the overall quality of the goods, as well as the quality of packaging and delivery have improved tremendously. Years ago, buyers struggled with these details.
Compared with its U.S.-based manufacturers, Kole experiences a savings in Asian pricing, ranging from 20 to 80 percent. "Years ago, you might have bought a four-piece set of pens that retailed for a dollar. Now you can buy a ten-piece set that retails for the same dollar," he says.
The ASD/AMD merchandise trade shows, which bring in upwards of 45,000 attendees and 3,000 exhibitors, have seen a considerable increase in the number of Asian exhibitors. "Our Asian group is fairly substantial and has been growing over the past few years," says Chris McCabe, Vice President of the Merchandise Group of Nielsen Business Media, producers of the shows. For the past two years, two Asian manufacturing groups - China Brand and Source Direct -ran their own shows as part of ASD/AMD. "This area of our show has grown from nothing to five to six percent of our events," says McCabe. Most of the Asian participants are from China, but, they are beginning to see a significant increase in participation from India, Pakistan, Bangla Desh, South Africa and South America, according to McCabe.
Just a Click Away
With the age of the Internet, communicating with the Far East is much easier. Not only is email now the communication channel of choice, but Asian manufacturers' English has greatly increased.
Delivery has also sped up. While many Asian providers offer FedEx as an option, ships are still the preferred way to transport large quantities. However, according to Erik Autor, Vice President of the international trade council for the National Retail Federation, "Instead of one boat a week, there is now a string of boats moving between Shanghai and Los Angeles like a conveyor belt across the Pacific." In addition, he says, the modern container vessel holds 12,000 twenty-foot equivalent units, compared with 2,000 to 3,000 from 25 years ago.
Customization is a Key
Asian goods have a reputation for being easily customized. "There is a culture over there that is eager to do business. They are not opposed to thinking outside the box and doing what needs to be done to make goods more marketable," says Kole. "If we think the retail of an item would do better with two more in a set, we're able to easily make those changes to create a more viable selling point." Kole's Asian suppliers even give the importer control over package design.
China's biggest strength with regard to customization is textiles, says Autor. A few decades ago, "U.S. textile companies tended to develop a handful of products and would make it in only four different colors. Then they would produce mass quantities of it and go out and try to sell it." Conversely, he says, "Chinese manufacturers went to the customer and said, 'What do you want?' And the customer would say, 'I want this shirt in this fabric in this color on this date for this price.' The manufacturer would then do a short run of maybe 10,000 pieces of that shirt." As retailers monitored what was selling at the point of sale, they were able to replenish those items that moved quickly, and cut back on those that did not, a service U.S. manufacturers were not capable of providing.
China also produces about 80 to 85 percent of all the footwear sold in the U.S., a skill they honed by manufacturing for high-end brands like Nike, before going out on their own to create generic brands for the low-end market.
Overall product quality has improved, as a result of the toy and milk scandals of the last two years. The Chinese government has stepped-up their quality control methods, Autor affirms, as American wholesale buyers are putting much closer scrutiny on their supply chains. He recommends that buyers monitor their entire supply chain to ensure that even subcontractors are meeting all labor and security requirements.
WholesaleCentral.com - Your Global Trading Source
Finding a trustworthy source from which to purchase wholesale merchandise from Asia is essential to a buyers' success. WholesaleCentral.com, the oldest and largest wholesale-only directory in North America, responded to buyers' wishes to globally source merchandise by creating its Asian Source Page. WholesaleCentral Asia connects buyers to the Chinese and Asian wholesale markets to find hot products, manufacturers, wholesalers and exporters, allowing small to medium retailers to compete on price with the larger national chain stores.
WholesaleCentral.com has already established itself as the leader among wholesale marketplaces on the Internet and is becoming the definitive source for American buyers of Chinese and Asian products. WholesaleCentral Asia simplifies finding specific products from Asia with the "Asian Sources Power Search." This one-of-a-kind service allows wholesale buyers to search directly from the over 20,000 products featured in the Asian directory.
In addition to its extensive directory of wholesale sources, WholesaleCentral Asia offers information on Asian trade regulations and international business guidelines to help educate buyers. For more information, visit the Help Center at www.wholesalecentral.com/asianbuyerhelp.htm.
Top 5 Countries Exporting to the U.S.:
(Cumulative through October, 2008, in millions)
- Canada $293,305.6
- China $284,423.3
- Mexico $186,186.0
- Japan $119,362.6
- Fed. Republic of Germany $83,270.2
Source: U.S. Census Bureau, 2008
Top 5 Regions Exporting to the U.S.:
(Cumulative through October, 2008, in millions)
- APEC $ 1,100,903.8
- OECD $988,541.7
- NATO Allies $568,704.5
- Pacific Rim $555,407.7
- North America $479,491.6
Source: U.S. Census Bureau, 2008
APEC: Asia-Pacific Economic Cooperation (APEC) - Australia, Brunei, Canada, Chile, China, Hong Kong, Indonesia, Japan, Korea, Malaysia, Mexico, New Zealand, Papua New Guinea, Peru, Philippines, Russia, Singapore, Taiwan, Thailand, Vietnam.
NATO: Belgium, Bulgaria, Canada, Czech Republic, Denmark, Estonia, France, Germany, Greece, Hungary, Iceland, Italy, Latvia, Lithuania, Luxembourg, Netherlands, Norway, Poland, Portugal, Romania, Slovakia, Slovenia, Spain, Turkey, United Kingdom.
North America: Canada and Mexico.
OECD: Organization for Economic Cooperation and Development (OECD) - Austria, Australia, Belgium, Canada, Czech Republic, Denmark, Finland, France, Germany, Greece, Hungary, Iceland, Ireland, Italy, Japan, South Korea, Luxembourg, Mexico, Netherlands, New Zealand, Norway, Poland, Portugal, Slovakia, Spain, Sweden, Switzerland, Turkey, United Kingdom. Pacific Rim Countries - Australia, Brunei, China, Hong Kong, Indonesia, Japan, Korea, Macao, Malaysia, New Zealand, Papua New Guinea, Philippines, Singapore, Taiwan. Asia Near East - Bahrain, Iran, Iraq, Israel, Jordan.
Pacific Rim: Australia, Brunei, China, Hong Kong, Indonesia, Japan, Korea, Macao, Malaysia, New Zealand, Papua New Guinea, Philippines, Singapore, Taiwan.
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