Private labeling for Amazon

[Guest30156]

Hey everyone, I am about 3 weeks into my research learning about fastlane/passive income. I have decided my first project will be getting a product private labeled and listed on Amazon FBA. I have listened to podcasts and read blogs and now have questions I can't seem to find the answer to. I am curious about how one goes about private labeling. I am looking for a lot of detail here. How do I go to a manufacturer and request a change to a product? What kind of specifics do I need? I can't just say "make it bigger" or "make it the best quality". Do I need auto cad drawings or specific design details? I don't want to go to them and sound like an idiot. I have not picked a product yet but need to know how difficult the process is to brand something before I go any further.

Also, should I get a very detailed contract with my manufacturer? Are people just ordering and hoping for the best?

Last question (for now). How should I go about getting a business license for something like that? Does it need to be incorporated? I am an American currently living overseas until this summer. We move a lot because of the military.

Any help and advice is much appreciated.

 

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[In The Mountains]

I work in the product development department of a manufacturing company that deals with the type of project you are mentioning. While I'm sure there are certain aspects of the development life cycle that are different between our two industries (I work in medical and dental devices), I can share some of what I know from the other side of what you are doing.

First of all, it's very important to shop around for the right manufacturer for you. Manufacturers specialize in different products and different levels of involvement with the development life cycle. You need to decide how much help you want developing your product (and how much you want to pay for this). When approaching a manufacturer, the more specific you can be, the better. It is best to have CAD drawings ready. You should already have an idea of what is going to make your product "bigger" or "the best quality" as far as design is concerned, you will be paying for anything the manufacturer helps you develop. While it's in the manufacturers best interest to help you develop a successful product, opinions can and do vary. At my company, we can also be contracted to help with the design phase, but this is generally only used by large corporations and medical device start ups as this can be very costly.

Contracts contracts contracts... Make sure you have a detailed contract with the manufacturer that details your relationship. It should cover items such as: The work you are contracting for (should specify what is being manufactured and any other services provided and prices for all), supply agreement (Minimum order quantities, minimum annual quantities, time it will take to manufacture, how you place orders, etc.), quality agreement (what quality standards they will use on your product, how defective product will be handled, any certificates they will provide to certify the quality of the product, etc. You should read up on certificates of conformance, ISO standards for your industry and see if your manufacturer is ISO certified.), shipping terms (What paperwork they will include in the shipment, how they will package your product, and how they will ship it, how long you have to deny/return product upon receipt of shipment. Also covers who is responsible for the product at what stage of shipment. You can find a quick read on Incoterms on Wikipedia, it has a table that visually lays out the different options and at what point responsibility shifts from the seller to the buyer.) Chances are your manufacturer already has basic contracts laid out that they will want you to use since you are the smaller company. Read through it thoroughly, and don't agree to anything that shifts liability to you. You really should pay an attorney to review any agreement you sign because verbiage can be very sneaky and the manufacturer has their best interest at heart.

As far as business structure is concerned, I don't know enough about your situation to advise on this.

This is all pretty high level and basic. Let me know if you have more questions, I'm happy to help.

 

[jlwilliams]

I'm working on a similar concept and I'm going with an LLC. That may or may not be what's best for you, but it's what I'm doing because it gives me some degree of protection and it's not terribly expensive. S Corp and C Corp are way more complex and expensive in my state. My local lawyer recommends LLC for what I want to do over those structures for that reason.

The best bet for you is to find a lawyer in your area and talk it over. I went to my local insurance agent and asked her who a good local lawyer was for this sort of thing and got a recommendation. To be clear, I didn't ask the insurance agent because she's an insurance agent, I asked her because I have a working relationship with her and she has lived and done business in this town for her whole life. Point is, a recommendation from someone you respect is more better than the yellow pages or Google. State and local specific legal advice is worth paying for.

 

[SeanKelly]

Private labeling is simply putting your custom label on a ready-made product. There are companies that specialize in private labeling and they're easy to find. Have you even tried to use google......?

 

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[amp0193]

How do I go to a manufacturer and request a change to a product?

You email/skype/wechat them and ask.

What kind of specifics do I need?

Whatever you want to change. Attach your logo to the email, ask them what format they need it in. Ask what changes you want to make. Ask if they can do OEM orders.

Do I need auto cad drawings or specific design details?

If you're fundamentally changing the product, yes.

I have not picked a product yet but need to know how difficult the process is to brand something before I go any further.

It's not difficult.

Also, should I get a very detailed contract with my manufacturer?

Not until you're doing some serious volume.

Are people just ordering and hoping for the best?

Yes. That's why you start small and test. Pick suppliers from Alibaba that are "Gold Suppliers", Assessed, Onsite Check. Google the factory's name to check for fraud complaints. Pick a manufacturer that takes Paypal. Gradually increase order size to mitigate risk.

Last question (for now). How should I go about getting a business license for something like that? Does it need to be incorporated?

LLC offers protection from your personal assets. You can set this up, but it's not essential to do immediately. Follow these instructions, paperwork takes 10min: http://corp.delaware.gov/howtoform.shtml

 

[bigred]

Have you even tried to use google......?

I don't think so.....

 

[SEBASTlAN]

@axiom

 

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[Guest30156]

I am going through Alibaba so no, I didn't use the "google" thing you are referring to. I am not "simply" going to create a new label. I want to research a products flaws, make it better, and market it as such.

Private labeling is simply putting your custom label on a ready-made product. There are companies that specialize in private labeling and they're easy to find. Have you even tried to use google......?

 

[SeanKelly]

I am going through Alibaba so no, I didn't use the "google" thing you are referring to. I am not "simply" going to create a new label. I want to research a products flaws, make it better, and market it as such.

Okay so then you are not private labeling... consider using google

 

[Guest30156]

Okay so then you are not private labeling... consider using google

Ok, so maybe I wasn't clear. Or maybe I don't know what I am talking about. That is why I am here. I may just private label a product and I may find a product and rebrand it. But it will most likely be through an Alibaba manufacturer who does OEM. The info I want is stated in my original post. Do you have any useful advise for me? Like I said, I have done a lot of research and, of course, have used Google. I am looking for folks who have been down that road who can answer my questions about how to handle manufacturers and specific requests. Trust me, I would much rather Google the answer than be belittled on a forum where people are supposed to be helpful. The others have done a good job at providing that info so if you are not going to help that is fine.

 

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[jlwilliams]

Lets not get bogged down in semantics.. "Private labelling" or "custom manufacturing" or "contract manufacturing" or whatever. Point as I understand it is, you want to get some stuff made and sell it and you want it to be "Your Brand". The salient point is the selling, but you can't sell what you can't get made, and no one gets made what they cant sell, and so on and so on. A dog chasing it's tail.

I have never worked through alibaba because I am old fashioned and want to meet face to face with manufacturers at some point in the process. For example, I'm waiting on my state bureaucrats to rubber stamp my LLC documents, while in the mean time working with a local artist who is helping me with concept art for the labeling. I have found a manufacturer I think I want to work with, in the American south west. Once I get a label and send them some specifications, they will send me a sample. At that time I could either have them ship to Amazon right off the bat, or I could book a flight and go there to meet them. The value I would get back for the price of the ticket is the knowledge on their part that I, their customer, can and will go there to work out the fine points. I find that to be significant. One problem I have seen people have with Chinese manufacturers is that the whole deal can fall apart because you are here and they are there; so the end product and therefor your marketability suffers when fine points aren't addressed and you are not as important to your manufacturer as he is to your operation. On the other hand, a manufacturer I have had some dealings with has a Chinese speaking engineer on their staff who travels to China a few times a year. They spend real money doing that, and the results they get verses the results other players in their industry get are telling. Moral of the story, be ready to travel to who ever does your engineering and manufacturing. You don't have to do it all the time, but you do have to be ready willing and able to do it from time to time. That being one reason I'm going with a USA manufacturer, along with the "Made in USA" on the label being (IMO) important for the product I am designing.

International flights are often less costly than domestic US flights for reasons I don't understand. From the east coast, it's often cheaper to fly to Paris than Portland. Depending where you are, China may not be too expensive to go to. Look into it (I say as if you don't already have a ton of research to do) and be ready to say "OK, I like what I see. I'll come to you to iron out a few minor enhancements and we can solidify a working relationship." People take you more seriously when you are a face and a hand shake than they do when you are a screen name and some text.

 

[jlwilliams]

To be clear, it isn't really necessary to travel all over before you make any money. It's important to be ready in your mind to pull the trigger. maybe the money for a ticket isn't right on hand before you sell some product, but if you know in general terms what sort of expense it might be you can prepare yourself to do it. Maybe it's a good idea to do so before the product comes out, if you need to. Maybe it is important once you have got some stuff in the pipeline and want to firm up a longer term relationship with a manufacturer (more likely)

 

[In The Mountains]

...be ready to say "OK, I like what I see. I'll come to you to iron out a few minor enhancements and we can solidify a working relationship." People take you more seriously when you are a face and a hand shake than they do when you are a screen name and some text.

I agree completely. You cannot set up a good working relationship if you don't go out and see the manufacturer to work out the fine details of your product or agreements.

 

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