From Inquiry to Order: The Steps in a Standard Procurement Process

For international small business owners, e-commerce sellers, and individual retailers looking to source products from China, understanding the standardized procurement process is crucial for minimizing risks and ensuring successful transactions. Here’s a practical, step - by - step breakdown of how to navigate the journey from initial inquiry to finalized order:

1. Market Research and Product Sourcing

• Identify your target product category through tools like Google Trends, Amazon Best Sellers, or competitor analysis.
• Verify product compliance with your local regulations (safety standards, labeling requirements, etc.).
• Use B2B platforms like Alibaba or Global Sources to identify potential suppliers, filtering by transaction history, certifications (e.g., ISO, CE), and verified supplier badges.

2. Supplier Screening and Verification

• Request business licenses and export permits to confirm legitimacy.
• Check supplier reviews and ask for references from previous international clients.
• Conduct video calls to inspect facilities virtually – many Chinese suppliers now offer live factory tours via platforms like Zoom or WhatsApp.
• Order product samples (3 - 5 suppliers recommended) to compare quality. Tip: Always pay for samples to ensure seriousness from both parties.

3. Price Negotiation and Terms Clarification

• Request detailed quotations including:
  • FOB (Free On Board) or EXW (Ex Works) pricing
  • Minimum Order Quantity (MOQ)
  • Production lead time
  • Payment terms (typically 30% deposit, 70% before shipment)
• Negotiate strategically: Bulk discounts are possible even for smaller orders if you commit to repeat purchases.
• Clarify responsibility for export documentation – most suppliers handle commercial invoices and packing lists.

4. Contract Finalization

• Ensure contracts specify:
  • Product specifications (materials, dimensions, packaging)
  • Quality inspection procedures (third - party inspections available for ~$300)
  • Delivery timelines with penalties for delays
  • Warranty/return policies
• Use simple, clear language – avoid overly complex legal jargon. Many suppliers provide template contracts in English.

5. Payment Arrangements Common options for small - volume buyers:

• Telegraphic Transfer (TT): Most widely accepted; confirm bank details via multiple channels to avoid scams.
• Escrow Services: Platforms like Alibaba Trade Assurance hold payment until delivery confirmation.
• Letter of Credit (LC): Less common for orders under $20,000 due to bank fees. Always request a proforma invoice and confirm currency (USD preferred) before transferring funds.

6. Production Monitoring

• Request weekly photo/video updates of production progress.
• For custom products, confirm prototypes before full production begins.
• Schedule a pre - shipment inspection (PSI) – either conduct it yourself or hire a local inspection agency.

7. Logistics and Customs Clearance

• Decide on shipping terms:
  • EXW: You handle all logistics (best for experienced importers).
  • FOB: Supplier delivers to port; you arrange sea/air freight.
  • DDP (Delivered Duty Paid): Supplier manages everything (higher cost but simpler).
• Ensure proper documentation:
  • Commercial Invoice
  • Packing List
  • Bill of Lading/Air Waybill
  • Certificate of Origin (if required for tariff benefits)
• For first - time importers, consider using a freight forwarder to handle customs brokerage.

8. Inventory Management and Feedback

• Conduct quality checks immediately upon receipt.
• Track sales performance to optimize reorder timing – typical lead times range from 45 - 90 days.
• Provide constructive feedback to suppliers to improve future collaborations.

Key Pro Tips for First - Time Buyers:

• Start with a trial order (20 - 30% of MOQ) to test the partnership.
• Keep communication records on platforms with dispute resolution features.
• Factor in 10 - 15% buffer costs for unexpected expenses like tariffs or storage fees.
• Build relationships with multiple suppliers to mitigate supply chain risks.

By following this structured approach, international buyers can systematically address common challenges like language barriers, quality control uncertainties, and logistical complexities. The process typically takes 8 - 12 weeks for initial orders but becomes significantly faster with established supplier relationships.