Eskil's Progress Thread: Starting a Supplement Business from Scratch

[snowman]

Eskil, congrats on your venture.

I'm tying to go down the same route of private label supplements.
Can you recommend a supplier with initial low minimum orders?
Also are you taking out your own public liability insurance on the actual product?

 

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[DeletedUser2]

for those wanting the definitive group about supplements

SupplySide West 2012

you can get

• manufactures
• suppliers of ingredients
• label guys
• formulator
• fulfillment places



we are going


Z

 

[verial]

Looks like we are getting into this field at the same time. You seem to be a bit further along in the process though.

My supplement is not a competitor of yours, so it would be cool if we could communicate through Skype about or respective ventures.

What was your startup cost? I'm looking at around $10,000.

 

[DeletedUser2]

Looks like we are getting into this field at the same time. You seem to be a bit further along in the process though.

My supplement is not a competitor of yours, so it would be cool if we could communicate through Skype about or respective ventures.

What was your startup cost? I'm looking at around $10,000.

Less than 3k. But your speed will be directly determined by the amount of traffic you can buy

 

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[mapaul04]

Eskil, congrats on your venture.

I'm tying to go down the same route of private label supplements.
Can you recommend a supplier with initial low minimum orders?
Also are you taking out your own public liability insurance on the actual product?

I too wonder about this.. are private labels covered under the suppliers insurance or do you have to take out your own liability insurance. It may depend from supplier to supplier, would be curious if anyone with more experience knew.

 

[Likwid24]

Hey Eskil, How's things going?

 

[Eskil]

Hey Eskil, How's things going?

Thanks for checking in, Sal.
After vacations in september and october I am now getting back into the groove. I am hoping to have my first trial batch ordered within a few weeks, and will post updates.

 

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[RonRea]

Fantastic thread, Eskil. Thanks for putting this up.

I'm just starting my journey in creating a line of supplements. I have a target market, I know the types of supplements that they would be highly interested in, and I know how to reach them at reasonable prices. I'm a medical research fanatic - ya, weird, I know - so I have a great idea for some all natural supplements that I believe would do great, but now I'm at the point where I have to get the manufacturing nailed down. I have know idea where to turn for that.

I bought a course called "Supplement Marketing Masters", but they seem to be more along the lines of finding something already out there and slapping your label on it rather than putting a your own product together.

I'm hoping you might have some advice as to any courses or sites that could point me to that would help me in my quest to go in the same direction your going. I know some manufacturers will work with you in creating your own supplement, but I'm not real sure which are decent and which I should stay away from.

Anyway, this is a great thread and I look forward to seeing you succeed in a big way! Thanks for any help you might be able to provide!

Ron

 

[Eskil]

Welcome to the forum, Ron.
To answer your question about courses - I haven't even looked for any to be honest. But I have learned a ton from just reading lots and lots about various minerals, vitamins, plant medicine, enzymes, and all kinds of things health related.

I also subscribe to Nutritional Outlook, which is a free industry publication with all the latest trends, contact info to suppliers, etc. I have found that generally speaking, you can learn just as much from information that is freely available - versus buying into courses. As far as manufacturers I don't know a resource where you could find out which ones are better than others. But try to gather a list of them at first, get their contact info, and get in touch with them to find out what their terms are, their production capacity, years in business, certifications, if they are able to help with packaging / fulfillment (if you have a need for that), and if they seem to have a solid way to source lots of various ingredients direct.

As far as my own progress on this - I have put it on hold until after new year's (but trust me - I WILL launch it) because I had a "Thomas Edison" invention moment a while back and I have been building a prototype in my garage for a new device lately that I want to manufacture and sell. My hope is that it may change the way people record mobile video, so I am very passionate about this. I will probably open up a new thread about this invention in the INSIDERS's section soon.

 

[Eskil]

UPDATE: Yesterday I finally placed my first order with the manufacturer! I have also settled on an entirely new label design which looks nothing like the ones I showed you guys before.

Now I have to wait a few weeks before I receive the shipment, but in the meantime I am working on content and planning out some scheduled social media messages for Hootsuite.

I have also prepared everything for Amazon, so when I get my shipment I can start selling right away.

 

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[Eskil]

EDIT: 28 feb.

MODS: I need your help with editing this thread. I thought first to move it to the INSIDERS's section, but have decided to keep it public for now (like 1step is doing with his) so that more people can follow it.

 

[Eskil]

The label design is final!

I received the official Supplement Facts panel from the manufacturer yesterday (this is required to have the appropriate "Daily Values", etc. per ingredient). This panel also states other ingredients that are included in addition to your formula - particularly things that the capsules are made up of such as cellulose and gelatin.

The panel was the last bit I needed to complete the label design. The design is nothing like what I have showed you guys prior in my label thread. It is now more sprinkled with benefits and attempts to convey a "fresh" and very healthy image. My brand name logo has been moved away to the back - and the product name is the main text upfront.

 

[tincho1492]

Very looking forward to see the final packaging!... and obviously how you progress with this product

 

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[andviv]

MODS: I need your help with editing this thread. I thought first to move it to the INSIDERS's section, but have decided to keep it public for now (like 1step is doing with his) so that more people can follow it.

Please take a look, I hope I got it right...

 

[Eskil]

Please take a look, I hope I got it right...

Thanks!

 

[gogiver8figs]

UPDATE: Yesterday I finally placed my first order with the manufacturer! I have also settled on an entirely new label design which looks nothing like the ones I showed you guys before.

Now I have to wait a few weeks before I receive the shipment, but in the meantime I am working on content and planning out some scheduled social media messages for Hootsuite.

I have also prepared everything for Amazon, so when I get my shipment I can start selling right away.

Way to go, Eskil!

 

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[Jamillah]

Nice! I'm looking forward to seeing your new label design. I love progress updates!

 

[Eskil]

Even though I plan on selling through Amazon exclusively at first, I have started working more on a sales page for the supplement. The main reason I want to have this ready is so that anyone who would want to get re-billed with a subscription at a discount can go there. Amazon also has a "subscribe" feature now for supplements, but so far only for products they own - not for FBA sellers or others.

For payment processing, I will probably go with http://www.evolutionbankcard.com/, which was recommended here on the forum by Deanna here.

 

[theorsays]

Great thread. Has there been any updates lately?

 

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[Eskil]

Great thread. Has there been any updates lately?

Not much more than me still getting things ready for when I get my shipment. I heard back from the manufacturer this morning, and they said they would have my product ready for me by the end of next week.

 

[healthstatus]

Eskil, great thread! Can you give us some numbers on what your costs to this point have been, getting the formulation set, the lab work, and what your first chunk of inventory is going to cost? I am trying to figure out if this is a $5k process or a $15k process.

 

[theorsays]

Eskil,
How do you create a balance between all your projects? It sounds like you're very involved in many things at once. Do you have a ft job and work on these projects on the side? Sounds like you have a lot on your plate!

 

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[Eskil]

Eskil, great thread! Can you give us some numbers on what your costs to this point have been, getting the formulation set, the lab work, and what your first chunk of inventory is going to cost? I am trying to figure out if this is a $5k process or a $15k process.

You can get started for less than $5k. I spent considerably less than that even, but that is also because I wanted to start with a very small test batch to begin with. The reason being that my product is something new and untested in the market and I didn't want be too much into it money-wise in case it flops.

The simpler route is to go private label, which is my plan B if my custom supplement should flop. Private labeling is basically going to a manufacturer that offers pre-made formulas, often pre-bottled, that you can slap your own label on. The upside to this is quick entry, sometimes with a minimum of 500-1000 bottles - but the quick entry MAY also be a potential downside, in that it violates the Commandment of Entry.

That's one reason I decided to go more custom at first - to create something more unique - while at the same time creating something that I knew there was a need for. I will have no direct competitors.

Just like with sourcing from China, minimum order quantities for supplements can be negotiated with most companies. Explain to them that you are serious but just need smaller quantities at first for testing. If they are hesitant, you can always try to offer to pay a bit more per bottle - in exchange for them doing a smaller quantity as well.

After all - you're not out to make a killer ROI from day one. You are just looking to see if you can actually get customers and sales. Once you do - then you can always get your costs down as you go. Besides - you don't want to be sitting on a big inventory of bottles that never sold.

Other costs I have had so far have been minimal:

• Logo creation/design: $0, I do my own graphical work.
• Label creation/design: $0, I do my own graphical work. Many manufacturers will offer this service for you at around $100, but don't expect jaw-dropping quality at that price point. Might be better looking for someone on Odesk/Elance for a more professional looking label
• Cinema4D mesh 3D model of a bottle, for product shot rendering: $5, Fiverr
• Seller Central account on Amazon, $30/mo.

My plan is to eventually sell through Amazon FBA, and then have a fulfillment center ship for anything that is ordered off the website. Until then, I will be shipping myself using Stamps.com with padded envelopes. Looking at around $2.50 - $3.00 in shipping/handling costs. I will absorb this cost in my product since my margin is pretty high, so that I can offer free shipping to customers. This because free shipping is frequently reported as the #1 conversion factor when people are considering a purchase.

Other costs that will come up once I get going:

• 800-number and call-center (Voipo.com + per-call costs for customer support)
• Outsourced content creation and marketing upkeep, social media, etc (with virtual assistants)
• PPC advertising spend, primarily Google Adwords
• Possibly a more proper cart system when I have more products. Looking at something like Limelight CRM for this. $800/mo.

I hope this answers your questions

 

[Eskil]

Eskil,
How do you create a balance between all your projects? It sounds like you're very involved in many things at once. Do you have a ft job and work on these projects on the side? Sounds like you have a lot on your plate!

Yeah I'm a bit of a workaholic, lol - but I know it will all be worth it. I don't have a full time job no. I do some occasional client work on the side (PPC/SEM/SEO consulting type stuff) - but my main two things that I work on every day are:

1) My supplement business
2) My invention (a physical product awaiting patent pending)

I haven't talked too much about that last one here, but I will probably be making a progress thread about it soon. And yes - I know that one should always stay true to only one project at a time, but I really feel that I had to jump on the opportunity of this invention of mine. The idea came to me while I was already creating my supplement concept - and in my spare time on weekends I started building out a prototype for fun. Once it was done and working GREAT, I thought "there is no way I am putting this idea on the backburner...I need people to try this thing". So I decided to move forward with both. Project infidelity, I know...sue me. Lol..

The goal with my supplement business is to build out something for passive income, and a brand that could be suitable for liquidation at some point if all goes well. My goal with with my invention is bigger than that. I think it has potential to be a worldwide seller, in a pretty hot market. That's why I'm very passionate about getting both off the ground. But..I will not let one sacrifice the other so this is why it has taken me time to get where I am at.

I separate my work time from each time of them equally every week and it is actually nice to take breaks from one to the other.

 

[1step]

Until then, I will be shipping myself using Stamps.com with padded envelopes

Didnt realize you were going this route. Have you looked into just using the shipping offered through Amazon. I havent looked into stamps but my shipping cost is $1.86 (3-5 day anywhere in US) add in a couple other costs (envelope, printing, etc) and its probably around $2.25 total.

 

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[Eskil]

Didnt realize you were going this route. Have you looked into just using the shipping offered through Amazon. I havent looked into stamps but my shipping cost is $1.86 (3-5 day anywhere in US) add in a couple other costs (envelope, printing, etc) and its probably around $2.25 total.

I've been pondering a few different options lately actually. I haven't looked at Amazon shipping yet. Yeah $2.25 sounds about right for what I figured as well.

 

[1step]

I've been pondering a few different options lately actually. I haven't looked at Amazon shipping yet. Yeah $2.25 sounds about right for what I figured as well.

The good thing is it automatically plugs in the tracking info so you dont have to. One of the things sellers are judged on is giving tracking information for each shipment so this feature is very convenient.

 

[Eskil]

Quick update here at the end of the week since everybody else is updating their progress threads too

Well, my manufacturer is now delayed yet again on when they said they will have the first bottles shipped to me. They're now over 2 weeks late so I'm getting a bit anxious. Communication is still good though, and last I heard a few days ago was that they had had some unforeseen setbacks that had caused the delays. Next week should be the week.

 

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[ableme]

Did you find the liability insurance a problem? This was one of my issues when I was researching supplement and health related products.

 

[Eskil]

Did you find the liability insurance a problem? This was one of my issues when I was researching supplement and health related products.

Not at all. Most manufacturers I talked to have this covered.