How I Find Cheap China Suppliers Today (Stop Using Alibaba) Transcript, AI Summary & Key Points

00:00 I've been sourcing from China for over 19 years for my seven-figure wedding head accessory store. In the last 18 months, I completely changed how I do it. Now, two things forced my hand. One, the tariffs shot up, so my landed cost calculations were now off. And de minimis, the rule that lets sellers ship low-value orders duty-free from China, is dead.

00:21 Every parcel now goes through formal customs. So, in this video, I'm going to walk you through the exact playbook that I use to find China suppliers today, and what changed to make me pivot. Now, let's first clear up some of the nonsense about tariffs first. In early 2025, the Trump administration stacked a bunch of new tariffs on top of the existing Section 301 tariffs from his first term, and then Biden era tariffs on top of those.

00:45 And at the peak, the total tariff on Chinese goods hit 145%. In fact, here's a bill from one of my buddies, where he paid $125,000 in tariffs on an $85,000 order. Now, even though these initial tariffs got struck down, there's still a 25% to 55% tariff that remains depending on your product. So, they are not gone. The second thing that changed is de minimis.

01:11 De minimis is the rule that used to let anyone import goods worth less than $800 per shipment into the US duty-free with no paperwork. It is what let AliExpress and Temu and Shein ship you a $20 phone case direct from a factory in China at ridiculously low prices. That old cheap direct ship drop shipping model from China is now dead, thank God, which opened up the market for legit importers like you and me.

01:38 So, how do you actually source under these new rules without going broke? Well, the single biggest lever is a Chinese website that most sellers have never even heard of. So, here's the first thing I want to walk you through, because this is what I actually do to source products from China in my own store. And it is the single best way to fight the tariffs.

01:58 The website is called 1688. If you've never heard of 1688, it is basically Alibaba's Chinese language sister site owned by the same company. But, it is built for Chinese domestic buyers which have far less money to spend. So, Alibaba caters to foreign importers and 1688 is the version Chinese businesses use to source from other Chinese businesses. And that one difference changes everything and here's why.

02:23 Alibaba charges foreigner prices. The suppliers know that they're dealing with an English-speaking buyer and they mark everything up 15 to 40% above what they would sell the exact same product for on 1688 to a Chinese business. And the price difference is even bigger on commodity products like phone cases, home goods, apparel, and kitchen items. On those categories, the gap can hit 40% or more.

02:50 And it's the same factory, same product, same photos, just a different price. Here's an example of a pair of identical slippers which are 66% cheaper on 1688 than Alibaba. Now, here's the catch. 1688 is entirely in Chinese and it's extremely hard to navigate even for someone like me. Most 1688 suppliers only speak Chinese, only accept Chinese payment methods, and only ship domestically inside of China.

03:18 So, you can't just click and buy like on Amazon or Alibaba. So, here's the workflow that I actually use and it's a little different from what most sellers do. Step one, I go on 1688 and figure out what the product should cost. I use Google Translate to translate my product into Chinese, paste that into 1688, and pull up the pricing from three or four suppliers on the platform.

03:41 That gives me the real Chinese domestic price which is a more accurate price for what the product cost to make. Step two, I take that price to my sourcing agent. The sourcing agent's job is to find that product at or below the 1688 price. And sometimes they can go even lower because they know factories that never advertise on either platform. But even in the worst case, the 1688 price becomes the starting negotiation price, and I know I'm not paying the foreigner tax anymore.

04:11 Now, doing it this way has some big advantages. Most sellers hand a sourcing agent a product spec and just trust whatever price the agent comes back with. But when you show up with a real 1688 price already researched, the agent has to beat it, and they cannot skim off the top. In today's tariff environment, this matters a lot because tariffs are calculated based on the FOB cost of the product.

04:34 If you can shave 30% off your FOB cost by using the 1688 price as your floor, you're also shaving 30% off of the tariffs, so it's a double win. Now, let's talk about the sourcing agent piece because in a post-tariff world, your sourcing agent is more important than ever, especially if you don't feel like traveling to China, which I rarely do anymore.

04:56 A good sourcing agent handles negotiation, quality control, freight consolidation, and here's the part that got way more important in the last 18 months. They can help plan your customs strategy post-de minimis. That means HTS code lookups, working with your customs broker, and making sure your shipment does not get flagged and delayed at the border.

05:16 Now, out of every 10 sourcing agents you talk to, maybe three actually do all four of those things. So, how do you figure out which is which before you commit? Well, here's what I look for. And by the way, if you're interested in learning how to start your own profitable online store and source like a pro, make sure you sign up for my free 6-day e-commerce mini course below.

05:34 It's 100% free, and I guarantee you'll learn a ton. One, I want a transparent commission structure. The industry standard is 5 to 8% of your order value, and any agent worth working with will tell you their commission up front. If an agent is dodgy about how they get paid, well, that is a sign that they're likely marking up your product costs behind the scenes and pocketing the difference.

05:57 Two, I want them to have a real office in China with a real team. I don't want a solo operator working out of a laptop in a coffee shop. You want an agent who has feet on the ground in the major manufacturing hubs like Guangzhou, Yiwu, or Shenzhen. That's how they get access to factories that never advertise online. Three, they have to speak English and Chinese.

06:18 Your agent needs to be able to communicate with you in clear English and negotiate hard in Mandarin. If either half of that is weak, it's just not going to work. Four, I ask for references from other sellers. A good agent has been working with US e-commerce businesses for years and can point you to sellers you can actually talk to. So, ask for references and actually call them.

06:39 All right, now for the red flags. If your agent quotes you a price without breaking down the product cost, freight, and their commission separately, just walk away because they're likely marking things up. If your agent doesn't offer inspection services or can't arrange it for you, I'll usually pass as well. Now, where do you actually find a good agent?

06:57 My best referrals have come from other sellers I meet at my Seller Summit conference and in the mastermind groups that I belong to. Word of mouth from other operators who have been through the process is worth more than any Google search. You can also find agents on LinkedIn, on some of the larger e-commerce Facebook groups, and on Reddit's Fulfillment by Amazon and similar communities.

07:18 Just make sure you vet them against the criteria I just walked you through. Now, the other big move I've made in the last year is adding a China plus one strategy to my sourcing. And if you've never heard the term before, China plus one means that you keep China as your primary sourcing country, but add one or two backup countries for tariff vulnerable categories.

07:39 The idea here is that you never want a single country failure to take down your entire business, especially when that country has tariffs bouncing between 25% and 145% depending on the political mood. For my store, the two countries I've added are Vietnam and India. Let me tell you why those two because it's not random. Vietnam is a default China plus one for most e-commerce sellers because the manufacturing infrastructure is already there.

08:06 A lot of the factory culture and operational know-how in Vietnam was actually built by Chinese owners who set up shop there to hedge against the tariffs during the first Trump administration. So, when you source from Vietnam, you are often working with facilities that operate almost identically to Chinese factories, but just under a different flag. Right now, Vietnam's effective tariff on most consumer goods coming into the US is around 12.5% Compare that to China where the same product could be sitting at 25% to 55%

08:35 depending on the category. And that is a 15% to 40% tariff savings for the exact same product. Meanwhile, India is a different story. India is strongest in textiles, handcrafted goods, and electronics, and the tariff rate on Indian goods coming in the US is around 10% right now, which is significantly lower than China. For my handkerchief and linen store, India makes sense because textiles are one of India's oldest industries and the quality on cotton and natural fabrics is really good.

09:04 For sellers in other categories, you can also look at Mexico, Pakistan, Indonesia, or Bangladesh. But, Vietnam and India are what work for my store and what matters is that you have at least one backup. Now, adding a plus one country is not free and can be a pain in the butt. You have to deal with two supplier relationships, two sets of quality control protocols, two sets of freight logistics, and in most cases, two separate sourcing agents.

09:28 So, it doubles the work. So, for small sellers doing $100,000 a year, it might not be worth it. But, once you cross a certain revenue threshold, and honestly it's not that high, maybe 500 grand a year, the risk of being a single country dependent business starts to outweigh the operational cost of running a backup. If the political situation with China changes, and tariffs go from 25% to 95%, having Vietnam or India ready to go can literally save your business.

09:58 Now, if you don't want to hire a sourcing agent, and you want the best way to find Chinese suppliers, go to a trade show. The two big ones are the Canton Fair, which is held twice a year in Guangzhou, China, and the Global Sources Expo, which happens right before Canton in Hong Kong. Now, trade shows took a major hit during COVID, but they are now back in full force.

10:19 At a trade show, you can easily find all the suppliers you need in the span of a couple days, and visit the factories as well. My friend Tom has been scared to travel to China for years. But, last year he decided to go to the Canton Fair for the very first time. He spent about $5,000 on the entire trip, including flights, hotel, and food. And while he was there, he locked in three exclusive suppliers, negotiated pricing that came in 40% below the market rate he was seeing online, and landed on a product that became his

10:48 first seven-figure winner. So, that $5,000 trip turned into $1.2 million in revenue, and that is the power of attending a trade show. Now, here's why trade shows matter more this year than they did 5 years ago. So, first, the face-to-face negotiation gets you deals that you cannot get online. Factories will quote you DDP shipping arrangements, and specific HTS classifications in person that they would never put in writing over email.

11:16 Because you are standing in their booth, they can look you in the eye, and know that they're dealing with a serious buyer. Second, you can find factories that never advertise on Alibaba or 1688. My sourcing agent once told me that a lot of the best factories in China do 100% of their business through repeat customers in trade show relationships. They don't need Alibaba because their book capacity is already sold out to buyers they met at Canton 5 or 10 years ago.

11:42 And if you want access to those factories, you have to actually show up. Third, and this is where the tariff environment actually helps you. It has scared a lot of buyers away from Chinese trade shows. Which means less competition on the floor for you. Factories that used to have every booth swamped with buyers now have more time to sit and negotiate with the ones who actually show up.

12:04 Now, before I wrap this up, let me hit you with the specific mistakes I'm watching sellers make right now that are costing them money. The first mistake is drop shipping from China. Do not build stores around AliExpress or Temu style direct from China fulfillment because that model is dead. The second mistake is not calculating landed cost before ordering.

12:25 Make sure you account for freight, customs agents, tariffs, and other miscellaneous costs that will be incurred during transport. The price you are quoted by your factory isn't even close to your final cost. The third mistake is trying to use 1688 on your own to save money. It is not like ordering from Alibaba. And every seller I know who has tried to run direct with 1688 vendors through Google Translate has gotten bad quality product.

12:49 Just pay for an agent. The fourth mistake is when you diversify your suppliers. China works until it does not and things are extremely volatile. In just the past 18 months, the tariffs have changed five times. So, it's like playing Russian roulette. The fifth mistake is not giving 1688 a chance just because it's in Chinese. If you are placing production orders on Alibaba without doing the 1688 price check first, you are voluntarily paying the foreigner tax on every single unit.

13:19 And now that you understand how I source from China, watch this video next to learn how to find your China plus one supplier.