Problems when importing self-balancing scooters from China

Importers should be prepared to face issues related to patents, shipping, profit and quality.

By Zhu Jing

Self-balancing scooters are one of the world's most popular products in 2015. A lot of customers want to import this product and have asked us to select suppliers from China.

In a recent article, we introduced the basics of importing self-balancing scooters from China. This time, we will focus on the problems you will face when importing self-balancing scooters from China in the hope that by knowing these problems, business will be smoother.

1. Patent issues

In September 2014, US company Segway filed with the USITC a complaint requesting the ITC to start an investigation pursuant to Section 337 regarding certain personal transporters, their components and manuals. The USITC instituted a Section 337 investigation in November of the same year.

Segway is the manufacturer of the world's first self-balancing scooter, and is the product's only US-based maker. It holds more than 600 patents for self-balancing scooters. In its USITC complaint, Segway identified several China makers of self-balancing scooters for infringing on its patents. Results of the investigation will determine if made-in-China self-balancing scooters can continue to be sold in the US.

China-made self-balancing scooters are popular among young US buyers because of their fashionable designs and affordable price. This has threatened Segway's hold on the market, leading the company to file a complaint in an effort to evict these China companies out of the US.

This has made importing self-balancing scooters by bulk to the US very difficult. This situation is limited to the US, however. In markets such as the UK, Canada and Germany, for example, there are no infringement issues so there is no need to worry about this problem if you will be importing into these destinations.

This reminds me of loom bands, 2014's most popular toy. The patent is owned by Rainbow Loom, which sued competitors for infringing on its clasp system. Because of this, almost all China loom band suppliers cannot export their products to the US so they ship to other countries instead.

2. Shipping problems

Because they are hazardous articles, batteries have always been difficult to ship by air. In fact, all airlines have recently stopped carrying batteries that are over 100Wh due to multiple reports of lithium battery-related fires on cargo planes.

Self-balancing scooter batteries are about 150Wh, making it impossible to ship in bulk by air. Airlines might even stop transporting all lithium battery types in large quantities in the future, leaving the sea as the only shipping option when buying in bulk.

Transporting by sea takes more time, but it is safer and legal, which is a must for all business.

3. With too many China retailers on the Internet, will you still profit from self-balancing scooters?

There are already thousands of China suppliers selling self-balancing scooters on retailing sites such as eBay and Amazon. These companies offer their scooters for as low as $320 with free shipping to Germany, although battery quality is not guaranteed. With such retailers crowding the market, volume importers are starting to worry they can still make a profit out of self-balancing scooters. (You may find $250 self-balancing scooters on certain retail sites, but that price does not include shipping. $310 is the lowest price to include shipping fees that I can find.)

With the airline restrictions mentioned above, a retailer will have to pay at least $120 express fee for each scooter, that is if the retailer can find an express forwarded that will accept the product.

On the other hand, a China supplier will offer 6.5in types for $130 to $160 each if an importer buys more than 10 units while sea freight by LCL or FCL to Germany will cost $6 to $12 each. This means the importer will still get good profit even if he sells the scooters in his country at the same price as a retailer's. Reasonable price, a reliable shop and commendable service will further encourage buyers to choose you over online retailers.

4. Choosing high-quality self-balancing scooters

The battery is key to self-balancing scooters as it determines product performance so it is very important to know what type of battery the supplier uses in the scooters when he offers his quotation. Some suppliers may scam you by quoting a high price but using poor-quality unbranded batteries. Be careful when selecting suppliers and do not focus only on getting a low price.

Suppliers usually offer two battery capacities: 2.2 and 4.4Ah. Batteries can also be categorized by brand, specifically LG, Samsung and no brand. Most unbranded batteries are poor-quality. Price difference is about $20.

Searching on B2B sites or Google is a good way to find wholesale suppliers. Avoid retailing sites.

In terms of location, suppliers in Shenzhen and Yongkang are usually manufacturers with actual factories since these two cities are China's main production hubs for self-balancing scooters. Shenzhen is known as China's electronic products capital while Yongkang is the scooters and hardware capital.

Zhu Jing is the founder of jingsourcing.com, which helps small businesses source products in China. The company is based in Yiwu, Zhejiang province, the biggest wholesale center in the world. Connect with Zhu Jing on LinkedIn or send him an email at info@jingsourcing.com.

See a comparison table of self-balancing scooter suppliers on GlobalSources.com