April 7th, 2020

Medical Supply from China and my role

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This is part of the series of posts on buying medical supply from China
Part I – Buying KN95 masks from China
Part II – Buying surgical masks from China
Part III – Buying Ventilators from China
Part IV – Medical supply from China and my role
Part V – Buying Rapid Test Kits from China
Part VI – Yiwu market shutdown for medical supply

Up to recently, I only dealt with friends whom I know, helping them with medical supplies from China. But recently, I got random emails from people asking for help and very often I have to explain my role and motives.

My personal priority is to help hospital frontline doctors & nurses get the correct medical supply they need. Whether that is done through the hospital direct procurement, a local-charity donation, a government or its agency, or business procurement. It would be nice to make some reasonable money along the way but that’s not my priority here. If you are working for charity or humanitarian causes, I will give you priority. 

I don’t work for a Chinese manufacturer or factories. I don’t own any inventory of medical supply. I don’t work for the Jack Ma Foundation or the Chinese government. People I am working with (on both side) prefer to get medical supply with a business contract instead of dealing with political agenda. 

I have lived in China for more than 10 years. I have Chinese partners who have very good access to any factories. They can also overcome most of the regulatory hurdles needed to get things done in China, within a reasonable limit. 

My role is more like a “wholesale sourcing agent” – You let me know what you need, the specification (such as which standards), etc, and working with my Chinese partners, I will find the products you want. I will also do some basic verification to ensure they comply with the standards, and you can ask for reasonable documentation before you place an order.

I have a regularly updated reference price list of most of the common medical supplies needed. Contact me if you like to have a copy. It is based on pricing from a number of factories. Wholesale prices for similar items across different factories are pretty consistent. When you are ready to order, I will get you a formal quotation.

Factories in China are overwhelmed with orders. They now expect to get paid 100% upfront before an order. They also expect to get paid in RMB. This is where my Chinese partners come in. They will help to (1) negotiate with the factories with the orders (2) forex and payment terms (3) domestic logistics to port of loading (4) deal with Chinese custom and the export permit (5) recommend air freight.

They are not in a position to deal with the destination customs. Different countries have different regulations for medical supply. You need to deal with that, or you find a local medical importer to help you. You have to pay for your own air freight and insurance – check freightos.com. Many of the friends arrange their own plane to China to pick up the items. 

We also strongly advise you to engage a third party assessors (e.g. SGS, Interdex) to verify the goods before you fly them back to your country.

FAQ 1 : I work for a hospital or charity and we need some medical supply. Can you help?

I would like to help – Email me at my Gmail. 

I will try to put you in touch with someone who can help you locally. Alternatively, I can put you in touch with an Chinese exporter who delivers goods to your hospital. Their price would be higher of course, because they need to include air freight, insurance, customs and local import tax (if any).

FAQ 2 : I have a business idea – I think we can make a killing selling X (e.g. sanitizer) in the market if you can help me source for it.

Thank you but I will probably pass. There are plenty of other people who would work with you on this. Try Alibaba.com.

I am not against doing business. My priority goes to doing medical supply to protecting and saving lives.

FAQ 3 : I like to place an order but can you send me a photo of you, holding the masks, with the certificates, standing in front of the factory, preferably with the owner of the factory.

I can understand if you don’t trust the Chinese. You heard horror stories about people placing an order and goods never delivered. You might not even trust me. At the same time, I also heard horror stories from the Chinese how they got conned doing business internationally, where they were given fake LCs and thus payment never arrived.  

Feel free to ask for some documentation of various goods. You can ask for photos of the product. I can even arrange samples to be delivered. These are within the realm of normal business due diligence. But if you make stupid requests like one did, I will ignore you. 

Factories are busy and overwhelmed with orders. I have friends that I trust and they trust me working with me. I am busy as it is right now so pardon me but I don’t have the time to “earn your trust” at this moment. 

FAQ 4 : Your price is outrageously expensive! or similar (You say it cost $5 for a NIOSH-certified mask but I found someone who can sell it to me for $3. What do you say?)

My reference pricing is based on quotations from the factory. I don’t own any inventory or stock. Before you think I am expensive or worst, I am price gouging, please feel free to check the market price from other people. (Showing me screenshot of Alibaba.com is not going to make your case. Try engagement them first and then let me know what the result)

My reference price list is just a reference price. Prices do change with volume and other conditions. I can only let you know the exact price when you are ready to order.

For example, NIOSH-certified masks are roughly $4.5 onwards. The production capacity is also limited so a large order may not reduce the price significantly. I only came across one consignment at $4 but never $3 (not in recent times).

If you really can find $3 NIOSH-certified masks from other sources, then I would say awesome! You should buy as many as you can because I don’t think I can. I would be happy for you and whoever you are helping. If you let me know your sources, I would be happy to help him push the $3 NIOSH masks to others as well.

I will try my best to secure what is value for money in the market. I don’t want to bring cheap but inferior products to the hospital. That is not my objective. I want to bring good protection kits to them at reasonable price.

FAQ 5 : Our government need Chinese government help and we don’t mind the political strings attached. Can you help?

In this case, you don’t need me.

If you represent government, then you should have diplomatic channels with the Chinese Ministry of Foreign Affairs. Call the Chinese Ambassador. They would be eager to help and make a deal.

FAQ 6 : I have a real quote from a factory that is cheaper then you quoted on your blog.

(Update Apr 12) First, price changes all the time. For the last month, price has come down week by week, especially for masks. However, one of the raw material “meltblown polypropylene fabric” for a lot of disposal medical supply just went up by 15-20% so I am expecting the price to go up. But I agree, it is more expensive than normal. But we are not in normal situation.

I also don’t quote from one factory. It is a mean-price in the market. When I say you can get NIOSH N95 at $5, it implies that is the reasonable price you are expected to pay. It can go as cheap as $4 but could be as high as $5, depending on volume, date of delivery and factory you using. But in the last few weeks, there is no NIOSH N95 at $3 from China, even at ex-factory price.

Which brings me to the next point: the price factories quoted you are what we called ex-work or exit-factory price. I am quoting FOB China price = Ex-Factory price + 13% VAT + transportation to port + exporter fees (including getting medical export permits and clearing customs). You will get Air waybill. I assumed you do not have the capability to deal with Chinese tax, domestic logistic and clearing customs.

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