PPE Parts 5 & 6: Can you make money importing PPE?

How to ensure the products make it from the port to your inland destination point?

Insider’s Guide: How to buy PPE from China during Covid-19 pandemic.

Parts 5 & 6: Can you make money importing PPE? How to ensure the products make it from the port to your inland destination point?

A growing number of people are looking into buying PPE from China for supply as the world scrambles to source equipment during the Covid-19 pandemic. Can you make money importing PPE?

Introduction to our series on buying PPE from China during the Covid-19 pandemic.

A growing number of buyers are looking to China for supply as the world scrambles to source personal protective equipment during the Covid-19 pandemic.

China sourcing was never easy, but the sourcing game has been taken to a whole new level of complexity as the pandemic turns the supply chain upside down.  A totally new set of dangers now exist on top of the common pitfalls that have plagued Chinese supply chains for decades.

In this series of blog posts and video tutorials, the author will walk the reader thru 6 essential steps for safely sourcing PPE from China.

Safely source PPE from China: 6 Steps

  • Is the seller a real company? Avoid the scams
  • If yes, are they making the products you actually want?
  • If yes, can this supplier export out of China to you?
  • If yes, can you import into your county?
  • Does it still make economic sense after factoring in the costs of air or sea transportation?
  • If the goods arrive in your country’s port, how to ensure they make it to your door?

Before we explore the steps in detail, let’s first confirm these articles are right for you as the reader.

Target Audience for this article on how to buy PPE from China during the Covid-19 pandemic.

In my consulting practice during the past few months, I have found that the potential clients fall into 3 categories.

This series of articles is written for readers who fall into Groups 2 and 3. If you fall into group 1, shame on you and consider the arrest of this joker who horded masks in NYC before you make your next move.

Insider’s Guide:  How to buy PPE from China during Covid-19 pandemic.

Parts 5 & 6:   Can you make money importing PPE?  How to ensure the products make it from the port to your inland destination point?

Key Steps:

  1. Is the seller a real company? Avoid the scams
  2. If yes, are they making the products you actually want?
  3. If yes, can this supplier export out of China to you?
  4. If yes, can you import into your county?
  5. Does it still make economic sense after factoring in the costs of air or sea transportation?
  6. If the goods arrive in your country’s port, how to ensure they make it to your door?

In step one (link) we covered how to avoid scams when sourcing PPE during the pandemic.  Now let’s explore how to confirm if the supplier you found can really make the products you want to buy.

In step two (link) we explored how to confirm if the supplier you found can really make the products you want to buy.

In step three (link) we learn not assume it will be easy for your supplier to even ship the PPE out of China.

In step four (link) we look at how to answer a key question that too many would-be importers forget to ask: can you easily import Chinese made PPE into your county?

For the final report in the series I’d like to address 3 items:

Can you make money importing PPE? 
How to ensure the PPE shipment makes it from the port to your inland destination point?
What other concerns keep PPE importers up at night?

Part 5: Can you make money importing PPE? 

Normally when importing from China, the buyer understands that it will not be easy, but if they pull it off, there is a decent margin to be made.

When importing PPE, not only it the situation far more complex than importing “regular products” but there is next to no margin to be made. Many importers are taking a loss because the value of the lives they save offsets the cost of goods sold.

Also, I’m of the belief that the price of PPE will start to fall dramatically in the upcoming weeks for the following reasons:

  1. Domestic suppliers have retooled production to make essential PPE.
  2. People are making PPE at home.
  3. Design files are readily available for free for 3-D printing.
  4. Chinese suppliers have an oversupply of many PPE.
  5. Amazon is kicking profiteers off their platform and capping the pricing.
  6. Police are literally throwing in jail people who are hording products in order to make a quick buck during this pandemic. As they should!
  7. Federal, State and Local governments are negotiating direct deals with Alibaba, Chinese governments and Chinese suppliers.
  8. Looks like the “curve” may be flattening, finally.

Part 6: How to ensure the PPE shipment makes it from the port to your inland destination point?

I had a small order of PPE cancelled last week after waiting 4 weeks for the delivery. I know the shipment made it from China to the US distributor. But at some point, while it was on the dock waiting to get shipped to me, my order was canceled at the 11th hour.  I suspect it was commandeered by the State or Local governments for emergency use. Or perhaps my order was caught up in the President’s use of the Defense Production Act which allows the federal government to take control over US supply chains and direct the PPE to areas where they feel PPE are needed the most.

As I write this article, it appears shipments of PPE are being commandeered by federal, state and local governments. It is not uncommon for these re-routed orders to enjoy a police escort.

Long story short, even if you do all the leg work to find an overseas supplier and have the goods delivered to the US, there remains a chance that your shipment could be commandeered (legally or otherwise). Especially if we haven’t flattened the curve and things start to get worse rather than better.

Are there ways to better ensure the chances of delivery from port to final destination?

I have a few clients in the US that were tapped by their local hospitals, county leaders and even State level officials to leverage their relationships in China to bring PPE back to the US as quickly as possible.  While there is no “fast pass” thru the US ports, I noticed that things appear to go more smooth when the end users (local hospitals and first responders for example) stay involved with the order and let the port authority understand the legitimate need and time sensitivity surrounding the order in question.

Bonus Section: What other concerns keep PPE importers up at night?

Let’s say that after reading my entire series of articles on importing PPE, you still want to do it for humanitarian reasons, or perhaps you like to gamble.  Either way, you have a major decision to make regarding the method of transportation.  Air freight is not cheap these days and the boats from China take about a month to get to the USA.

If you need the items urgently, can you afford to pay to go by air?

If you are hoping to make a margin, can you afford to wait 30 days for the goods to arrive by boat or will the price of PPE go down while the order is on the water?

Your guess is as good as mine!

Contact the Author

What’s your experience importing PPE?  Are there topics you would like to see me cover in future blogs?  Have questions? Do not hesitate to get in touch with me via the “contact us” page at www.AsiaBridgeLaw.com.

I’m happy to help!

Best regards,
Mike

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About the Author: Michael J. Bellamy

About the Author: Michael J. Bellamy

Originally from Upstate New York, Mike moved to Asia in 1993 and is a China business advisor to both Fortune 500 companies and small businesses.  Recognized as an expert on doing business in China, he has been interviewed by WSJ, CNBC, FT & Bloomberg.

A featured presenter on China issues at seminars, trade shows and corporate events across the globe.

Learn more about Mike and AsiaBridge Law at
https://www.asiabridgelaw.com/business-advisory-services/

Mike is the author of “The Essential Reference Guide to China Sourcing
(available on Amazon).

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