New flashlight eshop and the future of China business

The answer might not fit the question but: import duties in EU are low on most goods.
BUT you have to pay 21% VAT on the total (assurance or estimated) value plus shipping cost.
Customs “services” are not free. They outsource these activities. The fee cost you €13+ a pop.
So the new regime won’t be “every single small parcel lands for free at my doorstep”.
The new regime might be: add your orders in order to mitigate shipping and handling cost.

Or stop buying these things outside EU.

In the USA, it has been the case that when a Chinese company ships something to the US, the US postal service (the US taxpayer) picks up the cost so that Chinese companies get free freight on light packages. That explains why Chinese company’s don’t care if they ship 3 of those $1 widgets to the US in 3 separate air fare boxes a week apart instead of waiting and shipping it complete in a single package.

The reverse is not true and things shipping from the US to China are paid by the US shipper. That craziness was outed not long ago and apparently the Trump administration has been working to achieve equality. Not sure when it will change, but you can bet money it won’t continue. Those $10 flashlights coming out of China into the US won’t be getting the postal costs picked up by US taxpayers in the future at some point. The free ride for the Chinese will be ending, possibly July 2020 -so stock up now on cheap Chinese goods if you live in the US.

https://www.forbes.com/sites/wadeshepard/2017/11/05/how-the-usps-epacket-gives-postal-subsidies-to-chinese-e-commerce-merchants-to-ship-to-the-usa-cheap/#5df10c1c40ca

this thread was posted by me before the Corona pandemic…So,what do you all think now about the future of chinese stores and this e business?
It will be the same…?

Here was the rule that they add VAT if the total value of the product +shipping is over 15EUR, and this is going on for several years, but as far as I have learned actually here the customs decide which packages to sent at the customs office and which directly to the buyer based on monthly quotas. There have been various releases on this matter.
So because of this some people have to go to the customs, some not. Once you are there at that office they either add VAT or don’t based on quotas also, so basically most gets non-VAT.

As far as I see 3 or more years ago people were not buying like there is no tomorrow products from China online. Recently even the authorities make comments about the aliexpress influx of packages blocking the customs due to huge amount of packages.
I really think so far packages from China were ignored as being some cheap stuff, so who cares, but as the quality in China grew a lot and you can get now, serious smartphones, serious tables, serious laptops, serious flashlights, etc. everybody knows that not all coming from China is low quality these days, so it means there is some serious value to it that has to be taken into account.

And none the less the regulations will be stricter and stricter year by year, it is obvious that the governmental control is higher and higher year by year in all matters of society, why should buying stuff from China be a wild uncontrolled thing.

I think that there will be more reciprocity. The rest of the world will likely stop subsidizing shipping costs from China and start charging taxes, just like the CCP has always done to the rest of the world.

btw…is the free shipping from China to the rest of the world option only for eshops or for everyone?? private sending….
i read today,from july 2021 they will charge our orders…

I hope you understand there is no free shipping…

you mean i pay for it…but i dont know it….:slight_smile:

Yeah, it is included in the final price of a product. Yet the sellers pay low prices to the shipping companies due to being subsidized by the government.

Now the western postal companies are also subsidized, when you have a national post owned company that is losing millions of euros per year and that company does not go bankrupt and it is not being closed after so many years, means the government is supporting that business.

It’s supposed to be changing for the US next month, due to the the renegotiation of the decades old fee structure of the Universal Postal Union. When the last agreement was put in place, China was still just a budding economy, so they have enjoyed low shipping rates for a long time. Trump knew this, and threatened to pull out of the Postal Union, if the now vastly lopsided agreement wasn’t renegotiated to meet modern postal rates for large volume, small pkg (2kg) e-commerce importers.

China is supposed to pay up to 70% of what the post office charges for domestic mail under the new plan - still a subsidy for China.

Can’t speak for the rest of the world but the United States pulled the plug on free shipping from China for >2kg packages. “Option V”, back in September 2019. This agreement allows the U.S. to set its own postal rates for imported parcels weighing fewer than 4.4 pounds. The deal also allows nations importing more than 75,000 metric tons of parcels to adjust their rates beginning in July 2020, with a second set of countries self-declaring new rates in January 2021. These reforms will lead to significant price increases for shipments from China to the U.S. starting to phase in July 2020. According to the Chinese Post Office, fees paid by China to the U.S. and other countries to deliver packages will nearly triple through 2025 as rates get phased in.

The reality is that most shipping from China is via Ocean bulk tonnage and not subsidized, so your cheap Walmart goods will still be cheap Walmart goods and despite the hit to the flashlight community it’s not a huge hit on China’s ability to export. Chinese mfg are savvy hard working folks who will generally work around these new issues such as bulk shipping to Amazon and setting up US stores, etc etc.

But is the free shipping for everyone or just for eshops etc… People who make business? I heard not everyone for example on ebay has real seller license… And 5hey have also free shipping…

what i have seen with cheap stuff - aliexpress etc, is that there are no more 21 cent deals for anything

everythign starts now at about 89 cents.

So there is the shipping subsidy removal.

the cheap stuff before was usually things that could be sent in small thin envelopes

if it was heavy or big, like a bicycle or a welder, you could usually get it cheaper at walmart or amazon

It was never “free”. For the United States, our “free” shipping was paid by all of the Americans who ultimately subsidized this “free” shipping.

As much as I’ve benefited from the old system when buying things from China, I also agree that it’s unfair and I should be paying for what it costs to ship items to me.

its in my language…but-its here.from 2021 all gadgets should be not cheap anymore-cos vat tax on border and other taxes….and we will have to wati much longer to the delivery….will the eshops move their warehouses to Europe etc?

I expect I will buy a lot less from China.

First the postage cost will go up due to the new arrangement.
Second there will be VAT on every order.

The days of getting a flashlight or some small electronics from China for €10 total will be history (in Europe).

I guess it will be tough on sellers like Simon and Hank.

China is NOT just going to wave goodbye to all our Western cash, not a chance.
The revenue brought in through the never ending flow of little parcels sent all over the West is just too rich a vein to have cut off.
When the revenue slows enough, I would imagine China’s government will step in, forcing manufacturers to lower their prices and lower postage costs in some way, I have no idea how - but they are not just going to roll over that’s for sure. For the average Chinese person, this would no doubt mean ‘going backwards’ pay wise.

Iam very interested what will change next year…they wrote again articles about the new taxes and waiting time will extend a lot…

I think there are various outcomes or a combination thereof:

- Despite higher postage, VAT and handling charges and a higher price point, some products will still be bought from China. Maybe the price is still cheaper than buying the product locally or the wait time for an overseas shipment still makes sense; because the part/product is not that urgent. Also, some products might only be available to retail consumers in Asia and not locally.

- We will see a new group of resellers that order in bulk from China, who know how to handle the commercials and fees, and they will simply sell locally or within their market (i.e. EU). It will be more expensive than finding deals in China, but still cheaper than ordering from Amazon or your local retail store. There is even a chance of a localized web shop revival - when is the last time you bought something from a small-ish web etailer and not from Amazon, GB, BG, ebay, etc?!

- The big overseas shops already have local warehouses, why not expand these operations and handle all the shipping, customs and drastically decrease shipping times for local markets? Rewards/loyalty programs, their strong brand, supplier relationships, a huge customer base, and manufacturing quality remain the same and are well-known. On various orders I have already received items from local warehouses.

The people who will miss out the most are possibly small-scale enthusiasts in niche hobbies. Custom flashlight parts or smaller product segments might be affected. Slingshots might be another group. Or any other group that isn’t big enough or relies on small scale individual shipping from Asia.