OK so I know this British fellow, his suggestion, which he is 100% sure will work:
-- exchange USD for Russian Rubles
-- use rubles to buy Chinese-made replacement vacuum cleaner parts
-- set up a warehouse in the newly-free (as he calls it) area of Donetsk
-- from this warehouse, drop-ship the parts to Britain and Europe, taking orders online
I have tried in various ways, to dissuade him on each of these points. Anyone have anything to add?
The reason this British fellow would want to set up a shipping warehouse in a Russian occupied war zone flogging Chinese manufactured vacuum parts speaks for itself as far as it being a legitimate and legal business ventures is concerned.
However, some observations...
First off, The definition of the term 'drop ship(ping)'...
"An arrangement between a business and the manufacturer or distributor of a product the business wishes to sell in which the manufacturer or distributor--and not the business--ships the product to the business's customers."So the first question is why does this British fellow need to set up a "warehouse" in Donetsk if he's drop-shipping? There should be no product to store/ship/receive. Or is he referring to an internet website using a Russian based server/internet provider located in Donetsk?
That's an early indicator this British fellow either doesn't understand what he's proposing or isn't familiar with business logistics terms...not a good start.
Anyways, moving on;
If, for instance, the Chinese vacuum parts were...oh, let's say pirated (copied) Dyson vacuum cleaner parts...they would be illegal to sell or install in any legitimate Dyson retail outlet or repair facility in the civilized world (Europe, UK, North America). So legitimate vacuum points of sale/service are already disqualified as potential customers.
If this British fellow was looking for investors/business partners to facilitate this venture. Those people would be in danger of losing their investment in that, again using the Dyson vacuum cleaner as the example, the company and owner vigorously protect their proprietary rights and design patents. I would assume this could extend to shippers supplying the parts outside of China as well.
I don't know how successful the various lawsuits have been against Chinese pirating, however, it wouldn't be for lack of trying. An example from 2010...
Dyson sues rival Vax over vacuum cleaner design ..."James Dyson launches legal action against Chinese-owned firm, saying it 'flagrantly copied' one of his company's designs "...
http://www.theguardian.com/business/2010/jan/27/dyson-sues-vaxBuying parts from a Chinese company that may at any point be forced to stop selling/shipping said parts could result in the loss of any investor/business partner's financing (no product, no shipping business).
Any company like Dyson has warranties/guarantees associated with their product. If a vacuum owner were to purchase the pirated parts from the internet instead of genuine parts to save a few dollars/quid the warranties/guarantees would be void. So the market is even further limited to older machine owners.
Last but not least, Russian occupied Donetsk is currently lawless. Any business, warehouse, company (especially foreign) setting up shop would be subject to the whims of the local bandits, mafias and just plain hooliganism associated with the area. Not to mention it's also a combat zone.
Further, if this British fellow is talking about setting up a commercial building to store goods, I highly doubt he would find an insurance company willing to insure/ compensate for loss of building structure, goods or equipment shipped, received or stored.
If this British fellow even suggested this might be a sound business proposition to you I would suspect a scam.
Brass