I suck at blogging.  Dan Harris does it better.  Renaud Anjoran does it better.  Tom Lasseter does it better.  If you have not already done so, subscribe to those blogs.  Today.

I have not done much blogging this year, as the news has been so universally awful that I’ve been unable to summon the enthusiasm to comment.  Short version, it is ugly out there and it will only get worse before it gets better.  Plan accordingly.

However, as someone who works with entrepreneurs and inventors on a daily basis, there is reason for hope.  People keep coming up with cool new ideas they want to bring to market, and they ask for our help.  PassageMaker had a solid growth year in a bad economy, so I guess I should be Chatty Cathy these days, but a combination of so much work and so little global good news as dampened my blogging spirit.

My one comment for the day deals with bringing a new product to market.  Our contributions to the value chain – sourcing, supply chain management, contract assembly, logistics – are really the easy parts.  The hard work is building a brand and getting it recognized in the marketplace.

If you are thinking about launching a new product, PassageMaker can take the headaches out of the production process.  But we don’t (and can’t) help you sell it.

Too often in the last few years, I’ve seen clients invest thousands in engineering, patents, sourcing, tooling, etc., with little thought given to how to get the product in front of buyers.  If you are planning a new product launch, assume that you are the only one who thinks it is the greatest idea since the wheel and focus on how you are going to convince the rest of the world. And budget accordingly.

My advice:

1 – The internet is great, but not everyone knows how to use it.  If your plan is social media and SEO, make sure you are really the expert you think you are.  Or have the money to hire that expert.

2 – If you are going Big Box, understand what that means.  A PO from a major retailer can be a million bucks on paper and negative income in reality when you consider the lead-times, warranty agreements, performance penalties, etc.

3 – Advertise if you can.  Twenty-some years ago, Coca-Cola assumed that their brand was so strong that they could stop advertising.  They ultimately lost market share to Pepsi and had to spend a fortune to get back in the game.  If you are launching a new product, nobody knows who you are, so you have to get the word out.

4 – If you can’t do it yourself, bring in investors who can help.  I’ve seen businesses with ridiculous numbers of investors, none of whom contributed to making the business a success other than providing short-term financing.  If you are going to add an owner to the mix, make sure they have skills to make the company a success long-term.

The one mistake I see clients make over and over (twice today so far as it happens) is trying to get ANYTHING made without a complete design database.  This never works, and is of course also always my fault somehow.  This in large part is why I formulated Kelly’s 1st & 2nd Laws of China Sourcing.

CES just updated their website, so go take a look!

I told him that all the green energy projects in China were on top of all the new coal fired power plants.  As one wag put it, it’s like a 600 lb. man eating a 12 course meal and then finishing up with a Lean Cuisine microwave dinner as a bedtime snack because he’s “on a diet”.

This reminded me of an email conversation with one of our Endorsed Service Providers, who also has never been to China:

Our ESP – Hey, Whit.  Is it pollution, or fog in this website background?  http://ringvemedia.com/ [ed. - That's really cool website by the way. Make sure to click through.]

Me – pollution.

Ignore the hype.  Solar and wind won’t replace coal, oil and gas anytime soon.  Thorium may be another matter, but greens have a cow at the thought of anything nuclear, so my conversation partner wasn’t talking about that.

Face it, we outsourced our pollution.

Jose writes:

I would like to import to China Espresso Making machines and Coffee from Italy.
Can your office provide import agent and logistics services?
My main question that I would like to ask of you is that when the Import Duty and the VAT is paid during the importation process at what point if any can I get a VAT Rebate?
I have been informed that I can get a VAT Rebate when the product is sold in the Chinese market, Is that correct? Please, help me clarify this point. Thank you in advance for your assistance.

My response:

While our niche at PassageMaker is helping buyers source products from China, our import-export license can be used to import products into China and manage the logistics. We have set up a sister company, www.Ansenjie.com to service this market.   Can you give me some idea as to the scale of your coffee project (for example, do you already have buyers and steady orders, or just getting started?) and I would be happy to put the right person in touch with you from my organization to talk about how we can be of service.

Regarding the VAT, you are correct that import duty and VAT is paid upon importation into China. I am afraid that whoever told you that you can get a VAT rebate when the products are sold in China did not give accurate advice.  But China is a big place and the laws change, so perhaps the person that gave you that advice knows something that I don’t.  The following is my understanding, but if your advisor knows different, please let me know as I too would like to stay up to date.

As I understand it, the VAT rebate is applied for when good leave China.   For example, if you were a China based legal entity (fully licensed to do trading and process VAT) and imported coffee and machines into China from your supplier in Italy, then sold the items to buyers outside of China, then MAYBE there could be some VAT rebate.  But in the situation you describe above where you are selling to the China market for end use in China, there is no VAT rebate that I am aware of.

Thanks again for your questions. Hope www.PSSchina.com and www.Ansenjie.com can be of service.

Wishing you smooth China business!

Best Regards,

Mike Bellamy

China Operations Director, PassageMaker Sourcing Solutions

Chairman of the Advisory Board, China Sourcing Information Center

Author,  The Essential Reference Guide to China Sourcing

Blogger, www.AnotherChinaBlog.com

LinkedIn Profile:  http://www.linkedin.com/pub/michael-bellamy-author-business-owner-volunteer-advisor/8/52a/389

“In 2007 there were a lot of products who’s VAT rebate was changed.  Is there somewhere where I could find this list to see which VAT rebates at export from China were reduced?”

I can get the list of the 2831 items in Chinese, but I have not found it in English yet.  But to help answer your question, here are the key items to keep in mind when looking back at the 2007 VAT rebate change.

1. The big announcement in 2007 was known as “Circular 90” and affected (reduced or eliminated VAT rebate) on 2,831 types of items in the following areas:

• Garment and textile articles
• Electrical and mechanic appliances
• Construction materials
• Base metals, minerals and their products
• Chemical products
• Animal and vegetable products

2. The items above were considered “un desirable” by Beijing because they were high-energy consuming or had pollution issues.  Also the very low tech industries got squeezed as China hoped to use the VAT restructure to encourage businesses to move up the value chain.

3. Soon after Circular 90 went into effect, the Global Financial Crisis hit and in order to stimulate exports in a slow global economy, Beijing backtracked on some of the 2007 adjustments made to the VAT rebate system.

4. In 2010, there was another round of changes but not as sweeping as 2007.

5.  So if you desire to know “what is the VAT rebate rate on a given HS code at present”, you can’t assume that the 2007 rate is still in place today. If you have some specific HS codes, I would be happy to look them up for you.

Wishing you successful China sourcing.

Best Regards,

Mike Bellamy

China Operations Director, PassageMaker Sourcing Solutions

Chairman of the Advisory Board, China Sourcing Information Center

Author,  The Essential Reference Guide to China Sourcing

LinkedIn Profile:  http://www.linkedin.com/pub/michael-bellamy-author-business-owner-volunteer-advisor/8/52a/389

And because so many of our clients and prospective clients like to visit us in Shenzhen, included is our holiday schedule for this year as well.

Here are all the Global Sources trade shows we’ll be attending in 2011 (booth numbers will be posted as they are assigned):

12-14 January –  Shanghai – Baby & Children’s Products; Fashion Accessories; Gifts & Premiums; Home Products; Swimwear & Underwear

Chinese New Year Holiday:  2-9 February

Tomb-Sweeping Holiday:  3-5 April

12-15 April – Hong Kong – Electronics & Components; Security Products; Solar & Energy Saving Products

20-23 April – Hong Kong – Home Products; Baby & Children’s Products; Gifts & Premiums; Medical & Health Products

27-30 April – Hong Kong – Underwear & Swimwear; Fashion Accessories; Garments & Textiles

May Day Holiday:  30 April – 2 May

31 May – 2 June – Dubai – Electronics; Home Products; Baby & Children’s Products; Gifts & Premiums; Fashion Accessories; Hardware & Building Materials; Garments & Textiles

Dragon Boat Holiday:  4-6 June

28-30 June – Shanghai – Electronics

11-13 July – Miami – Gifts & Premiums; Home Products; Fashion Accessories; Garments & Textiles; Baby & Children’s Products; Electronics

Moon Cake Holiday:  10-12 September

National Day Holiday:  1-7 October

12-15 October – Hong Kong - Electronics & Components; Security Products; Solar & Energy Saving Products

20-23 October – Hong Kong - Home Products; Baby & Children’s Products; Gifts & Premiums; Medical & Health Products; Christmas & Seasonal Products

27-30 October – Hong Kong – Underwear & Swimwear; Fashion Accessories; Garments & Textiles

13-25 November – Mumbai – Electronics & Components; Security Products; Home Products; Gifts & Premiums; Hardware & Building Materials; Auto Parts & Accessories; Bathroom Products

30 November – 2 December – Johannesburg – Home Products; Gifts & Premiums; Electronics; Hardware & Building Materials; Garments & Textiles; Fashion Accessories; Medical & Health Products; Solar & Energy Saving Products

6-8 December – Singapore – Home Products; Gifts & Premiums; Hardware & Building Materials; Garments & Textiles; Auto Parts & Accessories; Food & Beverages

To learn more about the shows and seminars, please visit Global Sources.

We look forward to seeing you at the shows!

Ideas born of greatness often times die from confusion, chaos and the inability to track and control development. With our network of resources, we at PassageMaker have made it our goal to eliminate the chaos and confusion and hand control back to you. A typical trading company operates by keeping the customer in the dark, whereas our motto is “Trust & Transparency”.

You will always know who your vendors are, where your product is, who has your designs and what you are paying for. PassageMaker does not add a hidden mark up and resell it to you, rather we charge only for the services we perform. Our resources allow us the ability to customize any operation regardless of size, scale or global target. Whether an invention, a mature product or anywhere in between, PassageMaker is your global solution.

Click on the link below to download our “Controlled Evolution of an Idea” sales brochure.

For those clients that need additional assistance beyond PassageMaker’s core services, our Endorsed Service Providers stand ready to assist your business in areas such as Engineering, 3rd Party Quality QC (3PQC) & Specialized Auditing, Lab Testing, Due Diligence, Legal Issues, Finance and Funding, Logistics, Marketing and more.

Click here to see our updated list of outstanding endorsed service providers.

Hover your mouse over each of the red service balloons to find out how PassageMaker can help your business.

Assistance is available to the buyer at any phase of production. Whether you need help turning an idea into production or you wish to explore the feasibility of producing an existing product in China, we can help.

Click on one of the links on the right column to find out specific details about PassageMaker’s service and fees

]]> http://www.psschina.com/2009/09/circle-of-services/feed/ 0