Part 6: Seven Must-Knows About Yiwu Market
6.1 Are all booths in Yiwu Market factories?
Some suppliers in the market are trade companies. They will have more powerful factory resources, or often buy some overstock products and change them into their brands for sale. And they also accept smaller orders, which can be quite flexible and competitive, compared with those factories who accept tens of thousands of MOQs.
Some are links to many small workshops because they work with them. And some assembly work is done in prisons or even in North Korea, so they usually offer a very competitive price.
And some are factory outlets, who come from Yiwu or cities all over the country, such as toys in Shantou, Guangdong, knives in Yangjiang, shoes in Fujian, etc. Relatively, their factories have large scales, and MOQ will be higher. And they may also accept orders in small batches of spot goods.
All stores will emphasize that they are factories. Sometimes it is even difficult for Chinese people to distinguish, let alone a foreigner who comes to Yiwu for the first time. Our suggestion is to find the right supplier according to your own needs. After all, big supermarkets like Wal-Mart and Metro are all doing procurement in Yiwu. I believe it won’t disappoint you.
6.2 Some Say that Products in Yiwu Market Are of Poor Quality! Rumors!
Many people online say that products in Yiwu are of poor quality, which is undoubtedly a prejudice. Why? Because the goods in Yiwu market are not just made in Yiwu! Some of them come from Guangzhou, Shenzhen, and other cities all over the country, whose quality may be good or bad. 30 years since Yiwu market has been established the market environment has always been upgrading.
For example, many toys, electronic products and bags come from Guangdong. Likewise, the products produced locally in Yiwu, like jewelry, toys and Christmas products are also sale in Guangzhou and Shenzhen. Of course, the suppliers will tell you that they are all Cantonese goods with good quality, which is just their cover-up to blind your eyes.
By the way, whether the quality of Yiwu products is good or not, customers have their answers.
Top 10 Export Destination Country & Their Share in Yiwu 2020(Bn $)
Top 10 Catalog Export in Yiwu 2020(Bn $)
6.3 Is Yiwu Market Only Suitable for Small Business?
Yiwu market is very friendly to small business buyers. The market embodies a wide range of products. Suppliers not only accept initial orders with the little amount but also support you to do some changes to the design, which is really friendly to some startups and to some small batches. You can buy a box or even a dozen from hundreds of suppliers and then mix them in one container.
Certainly, some buyers would purchase several containers of one single product. So the Yiwu market is not only friendly to small businesses but also suitable for some large purchases.
For MOQ, it is essential to note that if you only order one box or less from spot goods, some suppliers will agree to deliver the goods but charge an additional freight fee. For those without stock, it is necessary to have a relatively high initial order. Do note that if you order from stock, there is no way to change the packaging, design, or meet your special requirements.
At the same time, the Yiwu market is very suitable for cross-board commerce, as its express delivery volume ranking second in China, right after Guangzhou. You can find products in the market, customize packaging, and then deliver them directly to the FBA warehouse, or you can put them in Yiwu’s fulfillment warehouse. Some places with low time limits can save you lots of costs and tariffs.
6.4 Why Are Products in Yiwu Market in Low Prices?
China’s mature supply chain makes it very easy to produce a single product. You don’t need to set up a mould factory or produce those parts. You just need to make a phone call and all these parts can be debugged in your workshop. Earlier, Scotty Allen, an American, spent 2,000 yuan (about $297) in Shenzhen to buy all the components of an iPhone and assemble one himself. He videotaped his experience and uploaded it to YouTube, a video website, which became popular in an instant. While exclaiming Scotty Allen’s practical ability, netizens also exclaimed that China was amazing. Behind this, it’s China’s complete and mature industrial system and supply chain that are supporting it.
Homogeneous competition is quite severe in the market. In Yiwu market, you will find dozens of suppliers selling the same products, who can only compete on cost and price at last. Surely, it is a good thing for buyers. You can easily get a reasonable price without worrying about being pitted. However, sometimes they will quote a very low price for a product that you pay special attention to, and then slowly add in the price of another product. This product is like their promotional product. So we recommend you to make more comparisons and there is always the right supplier for you.
With over 30 years’ of development, Yiwu Market involves from the original road market into the present considerable wholesale market, thanks to these suppliers’ inseparable contribution. In the beginning, most of them are workshops as the front working as stores and the back as factories. Through the changing business environment, they’ve trained themselves well. For example, as labor costs rising, some suppliers move their factories to the western region where labor costs are lower. And some even distribute the production process into several different areas. They produce accessories in Yiwu, put assemblies in remote cities, and then ship them back to Yiwu for sale. In recent ten years, some put the assembly work in prison, from the prison in Zhejiang to the prison in Inner Mongolia. And now they also put the assembly work in North Korea.
Generally, Yiwu market represents made-in-China. Everyone wants to buy the products with the lowest price and the best quality. However, in such a competitive market, the only way to avoid loss is to compare products in several booths.
6.5 What is the Difference between Yiwu, Shenzhen, Guangzhou and Shanghai?
Guangzhou is a major trading city. The Canton Fair was held more than 100 years ago. Shanghai and Shenzhen are also the preferred places for overseas companies to procurement. Since 2000, Yiwu has been gradually excavated by purchasers. But many years ago the Yiwu market has been their secret play because they could buy very cheap products and make considerable profits. Of course, they wouldn’t tell their competitors.
Shanghai, Guangzhou, Shenzhen, Yiwu all have their own different advantages in the industrial chain, such as Guangzhou’s clothing, Shenzhen’s digital 3c, and Yiwu’s small commodities. Markets in Guangzhou and Shenzhen are basically classified by industry, such as the Guangzhou garment market, footwear market, jewelry market, luggage market and so on, which scatter all around the city. But Yiwu put all product categories in one market, with relatively high concentration. Well, it is really quite big and easy to get lost.
Canton Fair in Guangzhou is the most famous, followed by East China Fair in Shanghai. Now there are Import Expo in Shanghai, Yiwu Fair in Yiwu, and many exhibitions in Shenzhen. Exhibitions are said to be a supplement to the market, which is convenient for buyers to find suppliers, as the merchants in the exhibition also come from all over China. However, there are fewer and fewer surprises now.
What’s more, logistics is very convenient in these cities. In the first half of 2019, the ranking is Guangzhou, Shenzhen, Yiwu and Shanghai, calculating by express volume.
6.6 Is Yiwu Market Open on Weekend or Holidays?
Yiwu market is open all year round, except for the traditional Chinese Spring Festival, which usually starts in February every year and the holiday lasts about 15 days. The market usually starts at 8:30 a.m. Beijing time and closes at 6:00 p.m. But now some suppliers would rest on holidays. If possible, we recommend you avoid these festivals for a visit. Ordinary weekends are available for you, so you can go to the market at any time that is convenient for you.
6.7 Special Notice: Be Careful of Those Scalpers?
Buyers, especially new buyers, need to pay special attention to those scalpers in the market. Those scalpers usually call themselves “manufacturers” to introduce and promote their goods to you. They usually pull people to booths in the Fortune Building and sell their products by weight in the name of so-called “factory activities”, which do attract you by giving you very favorable prices. But there is no such thing as free lunch. After your payment, you will find that the products they pack and deliver are not what you want at all. In fact, what they deliver to you are actually some bad and outdated products. What’s worse, it’s not so easy to recover your loss. Some of the scalpers may still be there and you may recover some of the losses. But some just disappear after you pay the money, causing you heavy losses. So here we strongly remind buyers to be careful of those scalpers and avoid you from being cheated. Anyway, the better and easier way is to get an agent to help you.