The global LED lighting market is booming right now.
Due to its technology, efficiency, and eco-friendly properties this lighting solution is quickly filling the offices and homes all over the world.
And with such product demand, there has to be a powerful supplier.
China is commonly known as the world’s factory, the industrial center, so it only makes sense to employ Chinese import resources to satisfy the global LED lights demand.
Here, we will discuss the LED market, the market of Chinese imports, as well as some how-to guidelines.
Strap in and lets light up the world together!
The first thing you need to do is research.
No business can shine without rigorous initial research.
Find out about the market as much as you can.
Research The Best LED Manufacturers And Industry Information
Reach Out To Your Chosen LED Manufacturer
Check Out LED Exhibits
Design Your LED and Place Your Order
The Business Side of LED Import
Types of Import
The Documents You Need for Import
Paying To Your LED Manufacturer
Shipment Methods
Shipping Routes
What To Do Just Before Shipping
What You Need To Pay For
LED Products Quality Check
Materials For LEDs
Packaging Your Lights
Label Your Packages
Tracking the Importing Road
Finding Your LED Distributor/Warehouse
Step Into The LED Market
Avoid The Pitfalls
You can start with a simple Google search.
At this point, the broader your question is, the better.
Once you browse through some manufacturers’ homepages, blogs, images, and videos, you can make your research more specific, as well as make notes.
Note prices, advantages, disadvantages, styles, materials, FAQs, anything you find useful.
Then you can go back to Google and do more research.
Another resource we encourage that you check out reports.
These can be technical reports, business reports, and – very important – market analysis reports.
To give you some statistics, the global LED market was valued at 45 billions USD in 2018.
This value was forecasted to climb up at CAGR 11.8%.
Commercial lighting, such as gym lights, track lights, and tube lights, among others, will be more profitable.
A big and promising LED light will be smart lighting due to its innovative technology and versatility.
Also, importing to Europe is looking more optimistic.
Of course, these are just surface insights.
To find out more, you need to do more specific research.
Beware, economy reports may cost money, but you can always look at free samples.
But aside from that, you have a huge playing field of floodlights, spotlights, smart lighting, decorative lighting, and pretty much anything you want, so don’t worry!
After you feel satisfied with your online browsing and have settled on a few manufacturers, don’t hesitate to reach out.
Some websites have live 24/7 chats that you can use to talk to operators.
This is great because you wouldn’t have to wait for an email, but you’ll get some information right then and there.
Plus, the operator can provide you with additional resources and advice.
If the website doesn’t have operators, then just contact them via email or send in a quote.
Don’t worry about this step. You are the client and you are the boss.
Here you can mention the type of lights you want, their style, your budget, maybe send in some images of what you want.
While you’re doing that, you can check out available corporate literature, as well as history and reviews of that manufacturer.
If you are contacting several businesses, this step should eliminate most of them, leaving just one or two.
You can also request a free sample of the manufacturer’s standard light just to see how it works and check the quality for yourself.
Here is the active part of your investigation.
Research some LED expos and showrooms.
There are many Chinese expos all around the world, so you can go to such an event and talk to suppliers, see more LED lights and delve into the market more.
Some prominent expos in China include the Canton fair, the Hong Kong exhibit, the Shanghai expo, and the Shenzhen convention.
Most notable ones are the Canton Fair and the Hong Kong exhibit.
The Canton fair is the oldest, most representative, and the largest lighting fair in China.
It harbours not only manufacturers, but also private enterprises, scientific research institutions, and even foreign trade companies.
It is specifically targeted at import, so that is definitely an event to check out.
The Hong Kong exhibit is an international event, and it is the biggest in Asia and the second biggest in the world.
To give you an idea of how big, in 2018 there were 1355 exhibitors and over 20 thousand visitors.
There, you can see the latest LED technologies and take note of the best trends and designs.
Plus, you can talk to different manufacturers.
Our SMAlux team will be waiting for you!
Also, you can visit China.
Ask the manufacturer if you can have a tour around the facility.
If yes, go for it! If not, then request at least a meeting.
Either way, seeing your possible business partners face to face is definitely a plus.
When you are ready to place an order, request another sample based on your specifications.
To make sure that there are no misunderstandings, send in your inquiry in as much detail as possible.
Here is where all your previous technical research comes in handy.
Decide what lumen output you want, what beam angle, what light intensity, what color temperature, what design, what IP code, installation method, charging method, LED type, materials.
Anything that comes to mind, outline it.
Also, make a detailed sales contract.
It should include all your product specifications and quality requirements.
You may also be required to pay something in advance.
Usually, manufacturers want 30% of the entire sum in the beginning.
However, if they are asking for more, be very careful when placing your order and have stricter quality control.
You can also request the manufacturer’s quote on Incoterms and city.
For example, FOB Shenzhen.
There are many Incoterms, so make sure to be familiar with those as well.
But basically, Incoterms are business terms that regulate the seller-buyer relationship.
It can include price, liability, shipping methods, and route.
If the order is small, the manufacturer may recommend FOB or EXW.
If the order is big, then they may sway you towards FOB or CIF.
These are just the most common ones.
FOB stands for Free on Board.
The most important takeaway from FOB is that you don’t pay sea freight charges.
It is the recommended Incoterm to use for Chinese import.
Other common Incoterms include FAS, CFR, and CIF.
FAS stands for Free Alongside Ship.
It outlines that the buyer is responsible for any damage to the products during shipment.
This term is good for the manufacturer, but not to you.
CFR, or Cost and Freight, means that the seller arranges shipment, but the buyer is still subject to damage charges.
CIF is Cost Insurance and Freight.
This outlines that the seller is responsible for insurance and loading the product, but during shipment the buyer becomes responsible.
This one is more or less safe both for the seller and the buyer.
Besides Incoterms, you should also look into shipment costs, as well as import taxes.
Regarding the shipping costs, many factors are at play here.
It depends on the weight of the cargo, the shipping method, the distance, as well as what the cargo is.
As for import taxes, there are plenty of online calculators to help you out.
But to get the best estimate, you need the HS code of your products.
Typically, different LED lights have a code of or close to 9405409000.
The way HS codes work is that half of it is international numbers, and half is national.
International numbers consist of a chapter, heading, and subheading.
National numbers just have divisions.
Also, you should know general regulations of the country you want to import to.
Currently, Importing to the US would give you some of the biggest taxes because of the trade-war, so the European market is far more welcoming.
Your overall landing cost depends on many things, so research them thoroughly.
Aside from regular shipment, you can opt for door-to-door shipping or drop shipping.
They are quite similar, but have a few differences.
Door-to-door is when shipment happens from the manufacturer’s warehouse directly to your customer.
This is done by specialized companies and can take off a lot of shipping stress you may have.
Here is where your bill of lading becomes super important since it can actually save you money.
Drop shipment is initiated by your customer.
They place an order, which you compile from different customers and send your own order to your supplier.
Then the manufacturer fulfills it and you ship it.
This is common for expensive products, but it is also prone to scams.
Import is a business that deals with a lot of money, a lot of people, and a lot of products.
Thus, you need a lot of documents to back it all up.
Overall, this step is the most involved one.
Here, you would have to make a lot of calls and sign a lot of papers.
It is better to make a checklist and follow it on this one.
Let’s dive into it!
Some initial documents you need are a customs declaration form, a packing list, an invoice, a contract, and export permission for some products.
Some other important documents include an import license, a bill of entry and of lading, insurance, a declaration of conformity, and an industrial license.
Your invoice and contract need to be authorized by your embassy, which either you or another company can do within 2-3 weeks.
Also, you should ask your supplier for a Proforma Invoice.
This is a document that declares the value of the trade, the commitment of the seller to provide goods on specific terms.
It goes hand in hand with Incoterms and gives you some security.
Keep in mind to have your original documents, not copies, during clearance.
Also, note the issue date because it will help you track your product and notice any delays in shipment.
But you’re not done here – there are more!
You also should have a carrier signature from your shipping agent, a description of stock, and notification for a third party to receive the cargo.
For more information on compliance with regulations and documents, visit an expert website.
Once all your documents are sitting neatly in your or your agent’s file, the real money can come into the picture.
You can pay with either your PayPal or through your bank.
PayPal is the safest and easiest options, so if you are a novice in the area of imports, use that, or make an account.
If you are more comfortable with using your bank, then contact your vendor for any and all information possible, such as swift codes, addresses, account numbers, etc.
Be sure to check everything many times over because this method is a little more prone to mistakes, which can cost you your money.
Once you’ve got the payment and your order all right, it’s time to do some business.
There are 4 main types of shipment you can use.
In most cases, you would actually have to combine these methods because one alone is not sufficient.
Sea freight is affordable and can carry large numbers or volumes of cargo.
However, sea and ocean freight requires more paperwork, has more taxes, and takes longer.
Thus, if you are importing large quantities as once, go for it, but if you are just starting, then you may not be importing as much, so other shipping methods would work better as they require less documents.
Furthermore, you can have either full container load (FCL) or a less than container load (LCL).
FCL is when your products takes up the full cargo, so you are importing a lot of product.
LCL is when you don’t have as much product to import, so you share the cargo with another importer(s) that go from the same port and to the same destination. Of course, LCL is cheaper, but FCL allows for more product to be imported.
Air freight is efficient, fast, and easy to track.
However, it does not carry as much as sea freight.
Also, air freight is the safest in terms of cargo damage.
Thus, if you are importing LED lights, you should consider air freight since your luminaires are less likely to crack and break during shipment.
Train freight is a middle ground between the sea and air freight.
It is affordable and fast.
However, it has an important limitation of being a ground-only transport.
Thus, with train freight alone you won’t be able to ship to the Americas, Australia, and Africa.
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