Selling to Chinese consumers, as a foreigner, can prove to be a daunting task to many merchants. The language barrier alone is something that can cause risks, and may potentially damage your business before you even get your shop up and running. For this reason, as a merchant on Alibaba, one option that you have when opening up your merchant site is to work with different contractors and agents to serve as the “middleman” for your operation.
In addition to making shipments, dealing with issues and serving as your Chinese customer service team, the right agents will go a long way in resolving issues and conflicts which may arise, especially if you are headquartered outside of China.
How Can Agents Help?
For starters, if you are outside of China it is very difficult to develop a relationship with local warehouses, companies and even your consumers. For this reason, having a middleman in place is something that you should consider if you are setting up your online marketplace.
First off, an agent can help in simplifying the transaction process. They will have local warehouses to keep your goods, allowing shipments to customers to take place immediately. This will eliminate delays in shipping, and will eliminate issues with lost merchandise or other shipping problems that tend to occur with businesses.
Additionally, having agents in China will allow for more shipments to be made. Many agents will ship weekly, others will ship twice a week; finding out which agents ship at higher frequencies (especially if you sell plenty of goods) is the easiest way to ensure your customers receive their merchandise quickly, meaning you will get paid faster as an online merchant.
Lastly, agents can resolve issues for your business. If problems do exist, having an agent in China will make it much easier to resolve issues, rather than customers having to continually communicate with people in the US or other parts of the world.
An agent not only simplifies your storage options with warehousing, they also resolve issues such as transit and shipping delays, and high costs you would incur if you were shipping everything from outside of China.
What Are Tmall Agents?
A Tmall agent works directly for your company. If you have a storefront in China, your agents will represent your business. Not only will they provide shipping services, but they will manage the storefront, they will assist customers with issues and represent your business entity when you are selling to customers in China.
What are Tmall Contractors?
A Tmall contractor is an independent agent providing different services to your business as needed. They do not work directly for the company, but rather provide services as requested, and as required by the business. Contractors do not have to abide by company policies either, meaning they simply perform the required task, and will not be under any strict company rules which agents would be required to abide by.
What Agents Do
Basically, companies that are set up outside of China will hire agents to do their purchasing and selling for them through the Tmall site. The agent will purchase on behalf of your company, maintain your products in their warehouses and ship the items to your customers upon placing the order with your store. A service fee of 10% is generally charged by these agents for their service, and acting as the middleman between your Tmall shop and your consumer base.
Choosing the Right Agent and Contractors
The process of selecting one of the dozens of agents you find online (via Google search) may seem like a daunting task. But, these factors will help make the decision making process a bit easier on you, and will allow you to choose the best agent to serve as your middleman if you are operating outside of China.
1. Make a List
Create a list of all agents found on Google and other searches. Write down their terms, fees, conditions, delivery and costs in order to be able to easily compare what different agents offer. Compare these fees, and consider items you are purchasing to determine whether or not you need an agent, and which one is right for your business needs.
If you are having difficulties choosing an agent, try to contact a few with service requests, and await a reply. Not only will you see their reply, but also how quick they are to respond, which will give you a better understanding of their work ethic.
3. Weight of Parcel
Items that weigh over 500 grams, will cost more when shipped to the US, Australia, and other foreign markets. So, prior to purchasing items make sure you estimate the weight to anticipate the costs. Many agents do offer discounted international shipping rates, up to 70%, but make sure you set aside some time, as package delivery will take quite some time for delivery.
4. Check their site
Quality information on the agent’s website will attract more people, meaning higher conversion rates.
The agents should be able to read and write English fluently, and communicate with you and your clients in the proper language as well.
Considering the above factors will not only allow you to find the best agent, but also the lowest fees, the highest quality merchandise and agents that will deliver to you in a timely fashion. This in turn allows you to turn around and sell to your consumers faster, and avoid high costs of warehouses, international shipping and maintaining stock of the items you sell to your consumers.
Which Agent or Contractor Should You Work With?
Zarmar, Taobao-agent, Yoybuy and more! With dozens of options available to you when choosing an agent, how do you know who to go with?
Each of these sites are ranked in the top ten with Google search for “Tmall agent.” This is a good start. You want to work with an agent that is well known, has been in business for many years and is easy to work with. Also, depending on the type of goods you sell, the agent you choose will greatly vary. If you sell clothing, shoes and other similar goods, Zarmar is a great option to consider. For those selling home goods, appliances and items for the home, Taobao-Agent is a great option, with low fees and international shipping.
So, as a store front operator, you have to consider the agents who are highly-ranked via online searches, those which provide the best rates for the items you sell and the ones which have a great reputation with the Tmall community and online site. Not only will this ensure you are going to pay the lowest fees to work with them, but will also ensure they are responsive, will resolve issues as they arise and will get items to your customers in the shortest time frame, for the lowest cost to you as the shop owner.
Look at Agent Reviews
Like anything else, from making an online purchase, to selecting the type of product you will sell, online reviews play an integral role in choosing the right agent. Using online reviews, and learning about what other online merchants have to say about the top rated agents, will allow you to choose the right one. Not only so you find an agent that is well respected in your industry, but also to ensure you are paying the lowest rates for the services they are going to provide to you as a store front on Tmall.
Do You Need to Work with An Agent or Contractor?
The answer is no; but, like any other business, working with a middleman is a great way to not only reduce operational costs, but also to reduce the number of incidents, issues with orders, customer complaints and returns.
An agent is going to help any store operator. Even major companies like Nike, Ray- Ban, HP and other companies on Tmall, work with agents and contractors to ensure their items are shipped to their customer in China and other regions of the world, in the shortest period of time. If you choose to work with an agent, you will want to consider the above listed factors so as to select the best one to work with, and to choose a company that is going to guarantee their services, their rates and their deliveries are made in a timely fashion.
If you choose to work on your own, it is important to know how to set up your business. Since you are going to be dealing with customer complaints, with the customer service, with shipping and warehouse issues, it is going to take up much of your time resolving issues, and working to keep stock moving. Although it is difficult to do, it is possible to work without an agent. Typically smaller store fronts will do better than a larger company that does hundreds, if not thousands of shipments on a monthly basis.
If you don’t have much stock, if you do not sell many items through your store front and if you only sell a limited type of product through your shop, it is possible to operate without an agent. However, mid-sized to larger companies should consider hiring an agent, and working with them through the sales and shipping process, as they will help alleviate the issues with shipments, warehouses and help eliminate the burden of having to deal with customers and customer complaints on a regular basis as the business owner.
Bottom Line: Agents and Contractors Generally Mean More Profits
Working and selling through Tmall can prove to be quite profitable, even for those businesses who are new to selling through an online marketplace. However, working without a sales agent is not only going to mean more work for you, it is also going to result in more issues. From issues in customer service, to problems with delayed shipping or issues with items being out of stock, not having an agent to work with may greatly reduce your sales and profit margins, and may result in unhappy customer transactions.
For these reasons, it is a good idea to work with an agent if you are selling through the Tmall marketplace. It is not only going to allow you to have more merchandise in stock, it will guarantee quicker shipping, lower cost for shipping, and happier consumers. If there are issues, customers will go through the agent directly, meaning you can focus on other business matters.