HOW do they do it? - imports from china cheaper than UK post!


#10

There are several reasons why this may happen (it happens to us all) -

You purchase items from wherever (UK) or Overseas supplier - you pay a Trade Price for the item (Perhaps in £Sterling or, $US) - there are lots of fluctuations with regards to the price whoever you buy from. Most prices have increased recently - many are blaming this on Brexit - in fact, I am fully aware that many of the Chinese Suppliers are looking at increasing their prices by 30% at least.
Assuming you purchase from a supplier in the UK, you are paying them for a product that they have purchased and imported - they want to make a profit and so the price to you is more than it costs them. They experience price increase - they will be passed to you.
If you are not VAT registered, and noting your PPI pricing, I would suggest you are not, you will also pay VAT on your items (if not VAT rated at zero) - dice, I doubt is Zero Vat.

If you buy direct from China, you will also have to purchase in volumes that justify the shipping charges - assuming you do this, you would then incur VAT / Import Duties - these are applied to the entire cost (not just the product cost).

No matter what of the two options above you choose, the Chinese Seller has the items on their doorstep - the cost to them is therefore likely to be a lot less. Add to this the fact that the Chinese Government subsidise sales, you are never going to get close to their prices.

Note, I have not mentioned the cost of the mail - the fact that they are able to get the items so cheap - they can factor postal charges into their sale price.

There are also several Chinese Sellers who use Fulfilment Centres in the UK - they despatch their items in Bulk Quantities and they are despatched by people in the UK who charge a fee to the Chinese. Many of those sellers have not paid duties - they are outside the UK and when challenged by HMRC they vanish - they then set-up new sales accounts and start the process again - each time, they avoid duties and taxes.

Fair - NO but, we are powerless to deal with the situation.

Unfortunately, the on-line sites that permit these people to sell are not concerned with those sellers - why should they be? You sell an item, the on-line site gets paid (a rather nice percentage) - they claim to pay the duties that they should and therefore suggest it is not their problem to pursue others.

Hopefully, this has shed some light on your concerns. I think we are all in agreement that something needs to be done to counter the situation - are you or I in a position to do something about it? Unfortunately not.

Perhaps, if those sellers that make it unviable for us all to trade make us all leave, perhaps then the on-line sites will look to challenge the matter.


#11

Post Brexit the UK Government need to impose a set of tariffs on Chinese state subsidised imports to level the playing field for UK sellers and manufacturers. Fair’s fair. Besides which, the Chinese domestic market is in no way as open to our exports as we are to their imports. Again, grossly unfair.


#12

Yes, but the cost of Royal Mail delivering it is between them and Chinese postal service. Not the buyer of the service.
Royal Mail charge a fair whack to us uk people for sending stuff that at the other end may be a lot cheaper.

Had a number of parcels returned last year that cost me 8 or 9 pounds by airmail. The buyer sending it back usually under 7 euros airmail.
What other countries postal services charge is down to them these days, if the Chinese government subsidise their post that is their choice. Perhaps after 2019 could try getting ours to do the same.


#13

There are most likely loosing money to test the market :wink:


#14

Do a load of volume and pre-sort as needed?


#15

The Little Party Shop has nailed it on the head. Basically free for the Chinese to get it to our shores as it is all subsidised by their Government, however I understand that the Chinese have an agreement with Royal Mail that their items once arrived in the UK, that Royal Mail will deliver them for …nothing.

Great.


#16

They also have a working caps lock key.


#17

Yes, its the same deal the British senders have with other countries, the delivery within that country is done for … nothing.


#18

Yes they now get a special rate by shipping via Royal Mail , I have noticed RM depots at most of the far east countries. I have found the best way of combatting this is to get boxes that comply with RM restrictions, ie under 25mm and post large letter rate.Okay for what I sell but if its thicker then you are stuck with small parcel rate


#19

Register with Royal Mail Business Account, the more parcels you send, the bigger the discounts. Mail is based on the average, so if you post 20 items, the postage is divided by 20 items.

Business postage is heavily discounted by doing it this way.

rgds, Nidge.


#20

Nearly all countries have this agreement, it’s called the Universal Postal Union (UPU).


#21

I am VAT registered - my PPI is 64p for 2nd lass large letter 100g - is there a cheaper way?


#22

THEY OFTEN PAY NO VAT AND THEY PAY NO INCOME TAX IN THIER OWN COUNTYR IF THEY ARE A SMALL BUSINESS


#23

Not all Chinese are dishonest :slight_smile: , but there is new practice that they use on the other platform. They lie about item location and set 30 days shipping time. With the cheap international shipping they can still beat most of the UK sellers, because of the higher taxes. If assume that the UK sellers are importers from China then they buy the same product + international shipping + customs duties + local taxes + higher domestic shipping. I always ask the Chinese factory why do they sell small quantities and sell as retailers too!?!? They kill the product that way.
But I can’t see good times for UK ( EU sellers ) if the VAT authorities and Customs don’t step in and protect their own sellers. Let’s not forget from where are their wages.
Im not against Chinese or any other country if they pay what they should. Scammers can be found in everywhere! That’s why we have authorities!
Hope the bad practice on the other site will be stopped. I’ve reported some of them and what they did is to reduce the delivery time ( it was 30+ days shipped from UK :slight_smile: ) now it is just 10 days.


#24

As a Chinese seller I am confused too, to be frankly.

I wanted to build a warehouse in U,K so that my customers would have a better shippment. However all the prices listed by U.K courriers are much more expensive than shipping from China. I had to give up the idea and force on FBA.

And I do pay VAT, if someone here is interested.


#25

Yes, its one way of driving up prices to the consumer here. Not sure of the benefit to anyone but our government.
And if China also impose a similar set of tariffs on stuff being imported from the UK it helps our businesses how?


#26

But what do we export to China? - I have never had a buyer from China - has anyone else?


#27

and the value of Chinese imports?

here it is…

In 2014, UK exports to China were worth £18.7 billion. Imports from China were
£38.3 billion. The UK had a trade deficit of £19.6 billion with China.

Edited by: dee on Dec 15, 2016 1:10 PM


#28

You may not have. However there will be companies in the UK who do export to China. In 2014 this was £18.7 billion. 3.6% of UK exports.


#29

£83 billion.
edit - sorry, dyscalcia. £38 billion.
Of which any import charges will be paid for by the buyer… who may then choose not to buy or may indeed pay the extra cost and have less to spend on other things.

Edited by: Martin on Dec 15, 2016 1:18 PM