If you’ve been thinking about starting a business, you may have brainstormed some ideas of your own, like capitalizing on one of the many in-demand products already on the market.
However, many entrepreneurs find themselves hitting a brick wall when it comes time to actually source products. Whether you plan on manufacturing something of your own or finding suppliers to purchase from wholesale, good products aren’t always easy to find.
In this post, we’ll look at the basics of sourcing a supplier for your next project. We’ll give you ideas for some places to search, and examine how you should approach suppliers and what to ask them when developing a product for your ecommerce business.
Domestic vs. Overseas suppliers
If you plan to manufacture or wholesale, when looking for suppliers you’ll need to decide whether you want to source domestically or from overseas. Overseas can refer to any location abroad.
It’s a good idea to secure two manufacturers: one domestic and one overseas. Your local manufacturer can be used as a backup. So, if orders from overseas are late or incorrect, you can fall back on your local supplier. They are often more expensive, but it’s better to keep products stocked and customers happy than having them wait for overseas shipments.
It’s often cheaper to source your products overseas, especially in Asian countries, like China, India, and Taiwan because of lower labor costs. But there’s a lot more to the decision than just the upfront investment and cost per unit.
Both domestic and overseas sourcing have their advantages and disadvantages:
Domestic sourcing
Advantages
- Higher manufacturing quality and labor standards
- Easier communication with no language barrier
- Marketing appeal of being made in North America
- Easier to verify reputable manufacturers
- Faster shipping time
- High intellectual property right protection
- Greater payment security and recourse
Disadvantages
- Higher manufacturing costs
- Less product choice (there are many items that just aren’t made in North America anymore)
Overseas sourcing
Advantages
- Lower manufacturing costs
- High number of manufacturers to choose from
- One-stop services like Alibaba have made it easy to navigate suppliers
Disadvantages
- Lower perceived quality from customers
- (Usually) lower manufacturing and labor standards
- Little intellectual property protection
- Language, communication, and time-zone barriers can be difficult to navigate
- Difficult/costly to verify manufacturer and visit on-site
- Longer shipping time
- Cultural differences in business practices
- Product importation and customs clearance
- Less payment security and recourse
When working with overseas manufacturers and suppliers, it’s a good idea to hire a manufacturing manager. These contractors are locals who live near your manufacturers and handle negotiations, orders, and managing your partners. They can also be the in between for your business and freight companies. Think of them as the central hub for your overseas supply chain.
If there’s an issue, the manager will work directly with the manufacturer to solve it. Managers also speak the local language, which helps improve communication and make production smooth for your business.
How to manufacture a product
Finding a manufacturer for your product can be tricky but it’s necessary to bring your products to life. Follow these six steps to find the best manufacturers and suppliers for your business.
- Research
- Outreach and collect information
- Communicate your designs
- Order samples
- Negotiate
- Place your order
Research
Finding the right manufacturer for your product is crucial to your success. Manufacturers control your product’s cost, quality, and packaging and shipping. Here’s how you can find the perfect ones.
Alibaba
Alibaba connects you with manufacturers from China. It’s a common marketplace to find existing products, but you can also use Alibaba to connect with manufacturers to create custom products. Simply search for the products you’re looking for and browse through the various suppliers and manufacturers.
It’s easy to safely buy from Alibaba. The marketplace lets you vet manufacturers upfront to get the best products at a fair price. When researching manufacturers on Alibaba, make sure they have the following qualifications:
- Gold supplier, which means they pay for their Alibaba membership.
- Verified, which means a third-party company or Alibaba has visited their factory.
- Trade assurance, a free service that protects your orders from payment to delivery.
You can continue to search by applying filters. You can sort by certifications (such as SA8000, which ensures humane working conditions) to find a manufacturer that aligns with your business values.
Another thing to consider when sourcing from Alibaba: make sure your manufacturer is not a trading company. A trading company is a middleman and won’t be able to produce your products.
Directories
Another place to research manufacturers is free online supplier directories. These directories contain profiles for hundreds or thousands of manufacturers, wholesalers, and suppliers. Below, we’ve listed a few of the most popular ones for both domestic and overseas suppliers:
Online domestic directories
- ThomasNet
- Maker’s Row
- MFG
- Kompass
- National Association of Manufacturers member list
Online overseas directories
- Oberlo
- AliExpress
- Indiamart
- Sourcify
In recent years, we’ve become accustomed to being able to easily search Google and find what we’re looking for in the first few search results. However, many suppliers haven’t kept pace with the internet or Google’s algorithm changes. Their websites are usually old, sparse on information, and not search-engine optimized.
So how do you find suppliers on Google? For possibly the first time ever, you’ll need to explore page two of Google search results and beyond. You’ll also want to use a variety of search terms. For example, words like “wholesale,” “wholesaler,” and “distributor” may be used interchangeably, so you should search for all of them.
It may help to make yourself familiar with Google’s search shortcuts to improve the quality of your searches and, thus, your results.
Negotiate
Between the time you get a sample and when you place your order, it’s still possible to negotiate terms such as payment or MOQ. When negotiating, put yourself in the manufacturer’s shoes. The goal isn’t to exploit your manufacturing partner to get the best price. It’s to work together so both parties profit and are happy. It’s the only way to build a long-term, healthy relationship.
Place your order
Last up, place your order. Do a 100% quality control check first. Check every product they’ve sent you to make sure it meets your standards. And if you’re happy with everything, send your order and get the production process started!
Finding your supply partners
Sourcing suppliers and manufacturers is a unique process but it’s one of the costs of starting a business. Trying to locate suppliers that are a good fit is a critical decision for your new business, and they aren’t always easy to find.
It’s easy to get frustrated when you hit dead ends or brick walls, but in most cases, it just requires a little more patience and perseverance to find the perfect partner for your new venture.
Wrapping up
We at ShopShipShake have been working with businesses like yours with fulfilling experiences. We offer one-stop services, including an efficient supply chain, over 10 thousand of China’s suppliers, and more.
With a successful track record of over 20,000 clients, we are sure to deliver your orders requirements. Let’s get in touch to build, sustain, and grow your businesses.
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