Specific, named mistakes we've seen Chinese factories make when entering the US market for the first time. With consequences and what to do instead.
What it looks like: A factory has a healthy mid-market brand in China and the EU. They ship the same branded goods to a US closeout broker to "test the market." The broker mixes the goods with other closeouts and sells them at deep discount to US dollar stores and discount chains.
Why it's a mistake: Your main-line brand now appears in the US at 40% of retail. Your existing US retail buyers (if any) see this. Your main-line pricing power erodes. Once you sell into the discount channel as your primary brand, you can't easily take it back.
What to do instead: Sell closeout-grade goods into the discount channel - B-grade production runs, end-of-line inventory, factory seconds, customer returns from other markets. Keep your main brand separate.
Some factories create a separate "outlet" or "secondary" brand for the discount channel. That's the right move if you have the brand real estate.
What it looks like: Factory files a US trademark application themselves (without a US trademark attorney) and ends up in the wrong Nice classification. Or files only one class when their product spans multiple classes.
Why it's a mistake: Trademark registrations are class-specific. A registration in Class 25 (clothing) doesn't protect home goods. If you only file one class and ship product in three, your "registered" trademark doesn't protect you in the other two.
Cost to fix: $400-1,500 in legal fees + the USPTO filing fee for each additional class. Plus months of delay while you re-file.
What to do instead: Hire a US trademark attorney. Cost is $150-300/hr for 2-4 hours of work - total $300-1,200 - to do it right the first time.
Trademark law is country-specific. A Chinese trademark doesn't protect you in the US. A Hong Kong trademark doesn't protect you in the US. You need a US-issued registration from the USPTO.
What it looks like: The shipping documents list the goods under a generic HTS code (e.g. "Other articles of plastic") when a more specific code (e.g. "Plastic household containers") exists with a different duty rate.
Why it's a mistake: Customs may assess the wrong duty rate. Could be overpaying. Could be underpaying - and if under, your goods are held at port while you pay back duty plus penalties.
If the goods are restricted or require special permits (children's products, electronics, food-contact), wrong HTS code = wrong classification = no permit = goods refused entry.
What to do instead: Use a customs broker who specializes in your product category. Verify the HTS code before the first shipment. US Customs and Border Protection has an online HTS lookup tool - use it.
What it looks like: Factory quotes a product price based on "$2,000 per 40ft container" ocean freight. They ship in September (peak season). Actual cost is $5,000. The deal doesn't pencil.
Why it's a mistake: Ocean freight varies 3-5x across the year. A quote you got in March is not the price in September. Your landed cost calculation is wrong.
What to do instead: Build your landed cost on peak-season freight rates, not best-case rates. If the deal pencils at peak, it pencils at off-peak. If it only pencils at off-peak, it's not a real deal.
Plan shipments for November-March when rates are lowest.
What it looks like: Factory rents US warehouse space "to look serious to US buyers." 12- month contract. $2,000-5,000/month. 6 months pass with no orders. $15,000-30,000 spent on empty pallets.
Why it's a mistake: The lease is real money whether you ship or not. And if you don't have product there, you can't fulfill orders - which means buyers find someone else.
What to do instead: Ship LCL (less-than-container-load) to a US 3PL provider on a per-pallet basis. No long-term commitment. Scale up to your own warehouse only when you have consistent volume - typically 4-6 containers per year.
3PL providers in the US: many options. We can recommend based on your region.
What it looks like: A "US sourcing agent" approaches the factory via WeChat, offering to "introduce US buyers" for an upfront fee of $2,000-5,000. The factory pays. The agent disappears. Or: the agent introduces one buyer who places one small order, then no more.
Why it's a mistake: Upfront fees with no clear deliverable are a classic scam. Even legitimate agents shouldn't charge a fee before delivering introductions. Commission-based (5-10% of sales) is the legitimate model.
Some "agents" are really packaging their existing small Rolodex of contacts and charging each new factory for the same introductions.
What to do instead: - Commission-based fee structure, paid after the buyer pays - Ask for references - actual factories the agent has worked with - Verify the agent's US presence (physical address, US business registration) - Start small: one trial introduction, see what comes of it
What it looks like: Factory sends their best-quality sample to a US buyer. The sample arrives with broken packaging, scuffed surfaces, or missing parts. The buyer assumes that's what production will look like. They don't place an order.
Why it's a mistake: Sample quality is the buyer's only signal of production quality. A sample that looks beat-up signals beat-up production. Even if your actual production is fine, the sample killed the deal.
What to do instead: - Send samples in retail-quality packaging, even for B2B - Include QC photos from a recent production run - Pre-pay for proper export packaging (foam inserts, corner protectors, etc.) - If shipping fragile goods, photograph the sample before sealing
What it looks like: Factory treats US buyers like Chinese buyers - fast decisions, flexible terms, relationship-driven. The US buyer expects paperwork-driven processes, longer payment terms (Net 30 to Net 90), and contract formalization before orders ship.
Why it's a mistake: Chinese buyers often: - Decide in 1-2 meetings - Pay deposits of 30% upfront - Take delivery in 1-3 weeks
US buyers often: - Decide over 3-6 weeks, multiple calls + emails - Pay on Net 30-90 after delivery - Want signed contracts and PO documentation - Require insurance certificates, compliance docs, customs paperwork
If you push for "decide now, pay deposit" you lose the deal.
What to do instead: - Expect a 2-6 week decision cycle - Quote Net 30 terms minimum (Net 60 is common for first orders) - Have a US purchase order template ready - Be ready to provide insurance certificates, W-9 forms, banking details, compliance docs
What it looks like: Factory emails TJX corporate asking to be a vendor. No response. Emails again. Calls. Tries again. Gives up after 6 months.
Why it's a mistake: TJX, Ross, Dollar Tree, and similar mega-buyers don't accept cold vendor applications. They source through: - Long-standing vendor relationships - Buying agents - Vendor onboarding portals (which require existing relationships) - Trade shows (ASD, IHA, High Point)
What to do instead: Get to TJX through an intermediate: - A US-based sales agent who already sells to TJX - A buying agent who consolidates from multiple factories - Attending ASD Market Week as a vendor (where TJX sourcing desks walk) - Through the Network section - we can introduce you to TJX-vendor agencies we've worked with
What it looks like: Factory ships one product line assuming it works across all of the US. It works in coastal urban areas but not in rural Midwest. Or it works in retail but not in discount.
Why it's a mistake: US consumer preferences vary by region: - Northeast: smaller spaces, urban style - South: larger spaces, traditional style - West Coast: contemporary, eco-conscious - Midwest: value-oriented, durable
The discount channel itself varies: - Dollar Tree: $1-$5 price point, generic goods - Dollar General: rural value, household basics - Five Below: trendy teen, mostly under $5 - Off-price (TJX/Ross): branded or look-alike, varied style - Closeout brokers: whatever's available
What to do instead: Start with one channel. Learn what sells. Expand. Don't try to be everything to everyone in Year 1.
For each mistake, we offer a service that addresses it directly. The mapping of services to mistakes walks through each one. The short version:
If you've already made one of these mistakes, we can help recover. If you're about to make one, we'd rather you not - that's why this page exists.