What Is the Chinese New Year and How Does It Affect Your FBA Business?

The Chinese New Year is fast approaching. Familiarize yourself with the holiday – and how it affects your Amazon business.

In a few weeks, the Chinese New Year will begin, presenting a unique set of challenges for Amazon FBA sellers. For new and existing sellers alike, the holiday requires planning and attention to steer your business toward success.

When Is It?

Friday, February 12th marks the beginning of the Chinese New Year. While the celebrations can last up to 16 days, only the first seven days are considered a public holiday.

The upcoming year is the Year of the Ox. According to the Chinese zodiac, the Ox represents hard work and honesty.

What Is It?

In short, it’s one of the world’s largest celebrations, with estimates of over a billion people taking part in the fun.

The arrival of a new year is celebrated across China, with customs and traditions varying by region.

In Chinese culture, dragon dances are common for the Chinese New Year, as they symbolize good luck.

With customs and traditions varying by region, spectacular celebrations take place all over the country. Often referred to as the Spring Festival, Chinese New Year festivities are known worldwide for their glitzy fireworks display, Lantern Festival, and traditional dragon and lion dances.

During these traditions, all major businesses in China and Taiwan shut down for the holiday’s duration. These businesses, including factories, shut down for at least one week and could close for up to three weeks. Of course, this results in a pause in production for those depending on products from China’s robust manufacturing industry.

What Does This Mean for Amazon Sellers?

Since many Amazon FBA sellers source private-label products from China through suppliers such as Alibaba, the manufacturing halt can leave sellers vulnerable to inventory shortages if not navigated appropriately.

At this point, sellers should no longer expect the fulfillment of new orders before the holiday. Unfortunately, there’s little you can do to stock up if you haven’t already placed an inventory order. Marking your calendar in the months leading up to Chinese New Year would be wise.

If you’re a new seller leaping into FBA, understand this could complicate and delay your entry into the marketplace.

As you’d imagine, a heavy backlog of orders builds before, during, and after the celebration. Due to this, anticipate lengthier delays in months ahead as factory workers fulfill backlogged orders.

To successfully navigate through the Chinese New Year and the obstacles place in front of you is to communicate. When selecting a manufacturer, the importance of strong communication cannot be understated. Many suppliers with strong communication skills reach out to sellers in the months leading up to the Chinese New Year to effectively maneuver through manufacturing speedbumps.

If you have yet to have these conversations with your manufacturer, contact your manufacturer ASAP!

Don’t Sacrifice Quality

Additionally, the logjam of orders encourages speedier work. As workers rush to fulfill your order, quality may take a hit. But rushing orders by sacrificing quality leads to compounding problems for Amazon sellers.

Utilizing a China Quality Inspection company helps ensure quality control and save yourself from returns, negative reviews, or any of the potential consequences from quality issues.

While the holiday can disrupt your typical workflow, it’s important to empathize with your manufacturers and respect cultures! You may even consider buying your contact a gift to celebrate the occasion, especially if they have a history of going above and beyond for you.

In the hunt for FBA success, many forget or downplay the significance of the human element. But the benefits of a great working partnership far outweigh the cost of a token of your appreciation.

Best of luck in 2021 and the Year of the Ox!

What adjustments are you making for Chinese New Year? Leave a comment and let us know!
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Best Practices: Inventory Planning for the New Year

As the calendar year comes to a close and holiday sales start to slow down, sellers should be ramping up for 2018, whether that’s ordering more inventory or sourcing a new product for your brand.

So when’s the best time to order for early 2018 selling? Immediately. If you haven’t already, getting those orders in as soon as possible is critical to having enough inventory to last you through early spring.

Why the rush? Three words: Chinese. New. Year.

The Chinese New Year is serious business, workers get at least 7 days off and factories close for up to a month. Yep, you heard that right, most factories will be closed for an entire month, beginning as early as two weeks before the New Year (which lands on February 16th this year) and lasting through the remainder of February.

Want to order samples for a potential new 2018 product offering? Now’s the time to order those too. Waiting until after the New Year means samples won’t arrive until mid to late March.

If you choose to move forward with the product, you’re looking at sometime in June before you’re FBA ready with stock available. That’s months of unproductive capital and less time to get the product ranking and selling before next year’s Q4.

 

Before Chinese New Year

Every factory does not follow the same closing schedule, but a good rule of thumb is to order inventory (for new or existing products) at least 45 days before Chinese New Year, although closer to 60 would be a safer bet. If you have a product that takes longer to manufacture, the earlier you place your order, the better. Because many factories will close before the holiday, waiting until a week before the 16th to order will leave you empty-handed.

You don’t just want to factor in the time it will take to manufacture your goods either. You should also consider how long it will take to be shipped, and know that cargo companies also close down for a period around Chinese New Year.

Although many Chinese cargo and shipping companies do not close until 3-4 days before the holiday, you’ll want to make sure your merchandise is ready to ship at least a couple weeks before this in case any issues arise. You do not want your goods to be stuck at port over the long holiday, most likely leaving you without the inventory you need and with a nice holding fee from the cargo company.

If you do get your order in and shipped before Chinese New Year, make sure to also run a thorough quality check over the items. As the rush to get orders completed before the holiday presses down on manufacturers, quality control may be more difficult to manage on their end. While it’s always smart to quality check, this time of year is especially important and could save you loads of customer service headaches later.

 

After Chinese New Year

The schedule for factories returning to work after the holiday varies as well. Most manufacturers will be back to handling administrative tasks within 5-10 days after Chinese New Year. That means they will answer your email, but they may not be back in the full swing of production.

Once production starts up again, work is likely to be slow and loads of orders will be backlogged. Don’t expect a timely turnaround or consistent communication, as being gone for that long causes delays and backups. Some manufacturers raise prices after Chinese New Year as well, so don’t be surprised if your costs increase when they return to work.

Not only will manufacturers be backlogged around this time (late February-early March), Amazon likely will as well. Loads of orders will flood into fulfillment centers after the holiday, causing backlog and delays.

 

Source and Order Now

If you’re looking to order fresh inventory for existing products, contact your manufacturer immediately to place your order. And, keep in mind you may want to order more than usual to maintain stock during the Chinese New Year.

Looking for a brand new product to source with your Q4 earnings? Want to kick 2018 off right? Check out our game-changing product finder, Product Discovery, and find your next great product in mere minutes.

You no longer have days or weeks to look through Amazon or check local stores for product ideas. If you’re looking for new merchandise to add to your brand’s arsenal and want it by early next year, you need to source now and place your order before you miss the window.

In a matter of hours, sellers are finding highly profitable product ideas using Product Discovery, drastically trimming down the sourcing process and putting sellers on the fast track to profitability. Taking your time could mean the loss of a couple months worth of sales, so don’t wait, check out Product Discovery today.