Assignment Part I- Product Choice
Students: go to alibaba.com then click on "User Guide". Take 10 minutes to glance through this. This is the modern "Product Market". This is not a consumer market where you go to buy one or two small items like the grocery store or ebay. This is where manufacturers sell, and retailers (like Walmart or ebay stores) buy what they sell. This is also a place where entrepreneurs get started in business.
From the Alibaba home page click the link "Buying Links". Type the word "used" in the search box so that you can see what used items people around the world are willing to pay money for.
Choose one item that you think you might be able to find for free here in the US that you could sell to an overseas company that is looking for that good (buyers on this page are only there because they want to buy something). Students, pick one item, click on the link and write down all the information about what the buyer requires and their contact info. Only choose an ad for a good (an item) that the buyer wants to buy that is available in the US; you might choose to sell an item that you have laying around your house like an old cell phone, you may have seen the item laying around (like old tires ), or you may have seen the item listed on craigslist or freecycle.com. Choose an item that is neither ethically nor legally problematic (some chemical compounds that are asked for on Alibaba are illegal to mine in the US).
Turn in your product choice to me and we will discuss your choice.
Assignment Part 2- Buyer Contact
Below are question for you to ask the prospective buyer that you have chosen on
Alibaba.com.
Copy This Text To Send To Buyer:
I am a student at ____ High School in Dallas, Texas, America. I have a lesson in my Economics class to learn how to open my own export business. I saw your company's request to buy used ____ . I have chosen your company for my lesson. Can you please answer the questions below: Please give a thorough description of the items that you wish to buy, including any specific traits.
To Translate The Text:
- go to this page http://www.worldlingo.com/en/products_services/worldlingo_translator.html
- paste the text in to the left side of the translation box.
- Do not type in A. Maceo Smith in to the blank before High School, or it may translate strangely (you will type this in later).
- Do replace the blank with the product description.
- Note how carefully I chose the words to avoid any translation mistakes; I was also very careful not to misspell words.
- The left box's translation is set to English by default - leave it this way. Above the right hand box, choose the language that your buyer speaks; you may need to research the language for the buyer's country. If the buyer is from China, choose Chinese Simplified. If the buyer is from Taiwan, use Chinese traditional.
Contact The Buyer: Find the buyers post on
Alibaba and click the "Contact Now" gold envelope icon. Paste the translated text into the email. Make sure to type in A.
Maceo Smith in to the blank. Click the "Send" button.
To Get Class Credit For This Activity:
Still in Alibaba,
- Click My Alibaba
- Click on Message Center
- Click on the "Sent" folder
- Click on and open the email that you sent
- Make sure that the alibaba window is fairly small (not full screen)
- With your cursor on the alibaba page, on your keyboard hold down the key and click the button (on the top left side of your keyboard) - you will not see anything happen
- Open the Paint program (Start - All Programs - Accessories - MS Paint and paste
- Save the file to your desktop as your name and file type .jpg
- Log into blogspot
- Open a new post
- Click to insert a picture
- Browse to the .jpg file
- Title your post "First Inquiry To Buyer of _____ in _______ country."
Assignment Part 3
Check your Alibaba inbox. Once you receive your buyer's response, you are to translate the questions below and send them to the buyer.
Questions to ask buyer in a follow up email
- What will you use this product for?
- How many of these items do you want to buy each time?
- How often do you want to purchase these items?
- How much are you willing to pay for these items? If you have a range of how much you pay, is the difference of low and high prices based on condition or something else?
- How do you require the items to be packaged? (boxes, wood crates, pallets)
- Do you require the items to be shipped by air or ocean?
- Do you require the goods be shipped with a specific freight company?
- Do your suppliers usually issue you a letter of credit? What terms do you expect on the letter of credit?
- Are there any import restrictions in your country for that item?
- Are there any import taxes on this item? If so, will you pay for these?
Assignment Part 4 - Determining Return on Investment (Can you make a profit on this venture?)
1) Explain how you know that it is available in the US.
2) What is the geographic location of the goods in the US? What shipping methods are available? What restrictions are there on transportation of such goods? What export documentation is required?
3) Considering transportation, storage and export documentation fees, the price of attaining the goods here in the US, the price at which you can sell these goods, taxes (federal, state and local) and foreign exchange rates will you be able to make a profit on the sale?
4) Compare the current supply of this good in the global market place. Who are your potential competitors?
5) To go into this venture, would it be better to enter into it as a sole proprietor, a partner or a corporation.
6) Financial arrangements that they (as the middleman) must make with both the supplier of the goods and the buyer of the goods. These will include Letters of Credit; FOB specifies which party (buyer or seller) pays for which shipment and loading costs, and/or where responsibility for the goods is transferred. This is important for determining liability for goods lost or damaged in transit from the seller to the buyer.
