Sharing my lifetime experience in export/import. Product sourcing specialist.

[tmb22]

I'm sorry if this has already been answered (there's a lot of GOLD threads to get through). If a medium to big sized company is selling a product that I want to improve and sell with my label, should I do some digging and try to find their manufacturer for that product? Or will they most likely have an exclusive agreement? There are only 2 companies selling this type of product and they are slightly different

 

[Walter Hay]

I'm sorry if this has already been answered (there's a lot of GOLD threads to get through). If a medium to big sized company is selling a product that I want to improve and sell with my label, should I do some digging and try to find their manufacturer for that product? Or will they most likely have an exclusive agreement? There are only 2 companies selling this type of product and they are slightly different

It is very difficult to locate the actual manufacturer of a product that is on sale in the market.

The best method is to use Google images to see if that product is being offered by the manufacturer.

Walter

 

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[Deleted58089]

Your book and this thread are a must read for everyone who is looking into importing.

Do you suggest other countries, apart from China, that are competitive in manufacturing real leather bags? Turkey seems a decent choice, especially for someone based in Europe.

 

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[Walter Hay]

Your book and this thread are a must read for everyone who is looking into importing.

Do you suggest other countries, apart from China, that are competitive in manufacturing real leather bags? Turkey seems a decent choice, especially for someone based in Europe.

Leather bags are made in many of the countries that I have listed in the 2019 revision, but finding good quality and a reasoanble price will be your challenge.

I have previously found excellent design and quality in Israel and the Czech Republic but I am not aware of pricing.

You will often find such products are made by very small businesses, and even by individuals. You will need to search country by country to get the best deal.

Regarding "real" leather from China. It is not always what it seems to be. Some very good fake leather complete with leather smell (added) is sold as real leather. In some cases the external surface is very thin real leather bonded to plastic imitation leather.

Walter

 

[personallegend]

Hi Walter,
Thanks so much for the insightful and valuable information on this thread. I have read your informative book as well and am already tuning my eye to watch out for those deceptive agents pretending to be manufacturers!

Sorry if this has been asked before (I am on page 22 on this thread and slowly making my way through it) but, how can you tell from inspection reports if a supplier is in fact a manufacturer? For example, I am looking at a SGS report and under Company Type, it gives 4 options: Manufacturer, Combined, Trading Company and Group Company. Are they a real manufacturer only if they have the Manufacturer box checked off? What does Combined and Group Company mean?

Also, I have a red flag going off since under Production Capacity of the report, it mentions Own Brand, ODM and OEM with 32 R&D staff but no mention of actual output production quantities. Am I correct in thinking that this might not be a manufacturer?

Thank you in advance!!

 

[mikeobi]

Hey Walter, hope you're doing well.

I haven't had to this thought until now, but do manufactuers use a client's molds/sell your product themselves? How do I avoid that from happening?

 

[MattR82]

Hi all, just curious if anyone has experience with importing machinery? I have a family member that is looking to upgrade a "clicker press" die cutter to a rotary die cutter with an automatic feed.

He is looking at importing one to Australia from China in the 5k to 15k range. Anyway, I think he has a lot more work to do in researching exactly what type he needs as there is so many models, but I was curious as to whether there may be a better place to look than China for importing these industrial kind of machines.

 

[MattR82]

There should not at this stage be any problems in importing such a product.

It would probably have to be packed in a wooden crate, and the crate has to pass inspections by AQIS. Time and cost can be saved by having an appropriate certificate prepared to accompany the shipment.

Fumigation may or may not be necessary, so you should consult a Customs agent in Australia about that.

Walter

ok great, yeah he has a broker etc that will do that for him. I just wasn't sure if industrial equipment like that was best sourced from China, but it does seem like it.

 

[Blackman]

Thanks Walter, I guess there's not much that can be done regarding the currency differences.

As for selling on Amazon US, I wouldn't be interested in that the moment. My focus currently is on eBay UK and then possibly my own e-commerce store, so don't have Amazon in my plans for the foreseeable future.

 

[avandelay]

I placed an order on Alibaba ($1000 item, $650 shipping) via their trade contract system, and specified DDP which the seller approved and I then sent payment via CC. I specified DDP because the seller mentioned using FedEx in their email.

A week later I asked for tracking and they sent an Air China waybill, said they overlooked the DDP part and already shipped it and I had to pick it up myself and handle customs.

Long story short it cost several hundred dollars in broker fees and travel, plus took 8 hours start to finish to pickup the item.

How good is Alibaba at mediating disputes, or should I go straight to my card issuer?

 

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[LPPC]

A box sealed in the way you illustrate should keep out the humidity.

If the glass transition level is in fact 45 degrees Celsius it would need insulation or refrigeration if there was a risk of reaching that temperature. If, as I believe to be the case, glass transition level is 60 degrees Celsius there should be no cause for concern unless the package was in something such as a closed vehicle in which temperatures can reach 50 to 60 degrees.

Walter

Hello Walter,

I have asked you this question a while ago, whether there would be a good chance that a product made of PLA would be deformed because of the heat during a train or sea shipment (glass transition level of 60 degrees celsius). You said that there would be no cause for concern unless the package was in something such as a closed vehicle.

Do you consider normal LCL containers for sea shipment to be a ''closed vehicle'' as you worded it?
I have called my sea forwarder and they said that I could not choose a different container for normal LCL shipments. The container is not fully sealed he said, so some air slips through, but there is no LCL container which has some sort of holes or gapes specifically made for ventilation.

The shipment will be shipped via sea beginning of June 2019 from China to The Netherlands. I have done some research and it appears that sea temperatures almost never go above 35 degrees Celsius if I'm not mistaken.

Thank you!

 

[Walter Hay]

I will number the points so that my answer will be easier to follow. @Blackman has given an excellent answer, but from my experience I am less optimistic about your chances of success.

Thanks. 1. Turns out their proforma invoice specifically said FedEx as the shipper. 2. If a seller ships FedEx air freight from China, does FedEx automatically handle the customs brokering, or does a certain FedEx product have to be ordered that gets it to your door vs picking up at a terminal and handling customs on your own?

3. One thing I learned is that especially now with the US tariffs it's very important to get the proper HTS code - some are subject to the tariff and some are not. When all was said and done there was the HTS code the seller provided that was inaccurate, the one that I and CBP agreed better described the item but was subject to the tariff and made the item ineligible for informal entry, and then one that the customs broker I had to hire found that best described the item and was not on the Section 301/25% tariff list.

4. This order was for one piece :/ it's a bulky item and China is the only source for it. I can see what you're saying to order something different that's smaller as a test before doing a larger order such as this. 5. The seller seems legit and the quality on the item is good, but they don't want to part with any money to make this right.

6. The seller's initial offer when I told them I had to spend 8 hours getting the item and $200 in money out of pocket was that they'd send me $100. Told them thanks but no thanks, escalated to Alibaba, and if they're no help I'll dispute on the CC. I'm asking for a lot more - I don't work for free and if they had performed as on the contract, or let me know before shipping it that they couldn't I wouldn't be having this issue. We'll see where it goes.

1. The Proforma Invoice, together with the Air Waybill should be sufficient proof that you have not received what was promised. I hope I am wrong, but in such situations Alibaba are little help. Whatever you do, you must do it quickly, otherwise Alibaba will forget about it.

2. FedEx shipments are automatically cleared by FedEx, and the clearance work, which should only take them a few seconds, is included in the freight charge.

My book explains in detail the difference between air freight and air courier. This, together with advice on how to avoid freight scams has saved many people thousands of dollars. You might find the cost a good investment before placing your next order.At least read through this thread.

3. If the supplier had used FedEx or if you had used a freight forwarder you would not need to bother knowing what the HS code is. Your experience has highlighted the fact that choosing the right code can be very hit and miss, with costly consequences if you get it wrong.

4. @Blackman was referring to the large value of the order, not the large size of the product. Always start with small orders.

5. You need to learn how to tell if the seller really is legit. Don't believe what you read on Alibaba.

6. This is possibly the most important part of your post. My answer is that I would immediately ask my bank for a chargeback on the CC. This is because I think you will find that both the seller and Alibaba will make your claim drag out until you tire of it and give up, or until Alibaba says the time for lodging your claim, proof, answers to their questions etc., has expired. Either that or Alibaba will say that you don't have sufficient proof. They are a law unto themselves. Their word is final.

Sorry to be the bearer of bad news.

Walter

 

[Walter Hay]

I will number the points so that my answer will be easier to follow. @Blackman has given an excellent answer, but from my experience I am less optimistic about your chances of success.

Thanks. 1. Turns out their proforma invoice specifically said FedEx as the shipper. 2. If a seller ships FedEx air freight from China, does FedEx automatically handle the customs brokering, or does a certain FedEx product have to be ordered that gets it to your door vs picking up at a terminal and handling customs on your own?

3. One thing I learned is that especially now with the US tariffs it's very important to get the proper HTS code - some are subject to the tariff and some are not. When all was said and done there was the HTS code the seller provided that was inaccurate, the one that I and CBP agreed better described the item but was subject to the tariff and made the item ineligible for informal entry, and then one that the customs broker I had to hire found that best described the item and was not on the Section 301/25% tariff list.

4. This order was for one piece :/ it's a bulky item and China is the only source for it. I can see what you're saying to order something different that's smaller as a test before doing a larger order such as this. 5. The seller seems legit and the quality on the item is good, but they don't want to part with any money to make this right.

6. The seller's initial offer when I told them I had to spend 8 hours getting the item and $200 in money out of pocket was that they'd send me $100. Told them thanks but no thanks, escalated to Alibaba, and if they're no help I'll dispute on the CC. I'm asking for a lot more - I don't work for free and if they had performed as on the contract, or let me know before shipping it that they couldn't I wouldn't be having this issue. We'll see where it goes.

1. The Proforma Invoice, together with the Air Waybill should be sufficient proof that you have not received what was promised. I hope I am wrong, but in such situations Alibaba are little help. Whatever you do, you must do it quickly, otherwise Alibaba will forget about it.

2. FedEx shipments are automatically cleared by FedEx, and the clearance work, which should only take them a few seconds, is included in the freight charge.

My book explains in detail the difference between air freight and air courier. This, together with advice on how to avoid freigth scams has saved many people thousands of dollars. You might find the cost a good investment before placing your next order.

3. If the supplier had used FedEx or if you had used a freight forwarder you would not need to bother knowing what the HS code is. Your experience has highlighted the fact that choosing the right code can be very hit and miss, with costly consequences if you get it wrong.

4. @Blackman was referring to the large value of the order, not the large size if the product. Always start with small orders.

5. You need to learn how to tell if the seller really is legit. Don't believe what you read on Alibaba.

6. This is possibly the most important part of your post. My answer is that I would immediately ask my bank for a chargeback on the CC. This is because I think you will find that both the seller and Alibaba will make your claim drag out until you tire of it and give up, or until Alibaba says the time for lodging your claim, proof, answers to their questions etc., has expired. Either that or Alibaba will say that you don't have sufficient proof. They are a law unto themselves. Their word is final.

Sorry to be the bearer of bad news.

Walter

 

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[LPPC]

In a study carried out by a manufacturer of desiccants, which are used to absorb humidity, it was found that temperatures in containers at sea rarely fluctuate, and humidity remains low.

The situation is different on land, and summer time temperatures inside a container can reach quite high temperatures.

However, in the test shipment from Japan to the Netherlands the temperature inside the container once on land at destination did not rise above 36°C.

Humidity was low while at sea , but rose as high as 90% on land.

My conclusion would be that it would be a good idea to pack and seal the package as completely as possible, and as an added precaution include desiccants inside the outer package.

Walter

Sorry for the late response. I have been very busy the past week.

So if I understand it correctly, temperatures at sea do not fluctuate much between the different seasons. So in the summers it does not get much warmer than in the other seasons. This makes it pretty safe to transport a product with glass transition level of 60 degrees Celsius (ofcourse, I take full responsibility for my decisions).

''However, in the test shipment from Japan to the Netherlands the temperature inside the container once on land at destination did not rise above 36°C.'' --> So the temperature did not raise above 36°C while it was in the Netherlands. The temperatures in the Netherlands almost never go above 36°C, so I don't understand what kind of significance this finding has? I might misunderstand it.

So I should pack and seal the package as completely as possible and include desiccants against the humidity. I suppose sealing it does not make the inside of the package much warmer? If it is completely sealed, then air can not get in to cool it down.

Thank you very much.

 

[LPPC]

Outside temperatures can affect the inside temperatures quite surprisingly, but total sealing should minimize the increase in inside temperature. Unsealed. the inside temperature can rise quite a bit above the outside temperature, but if that doesn't exceed 36°C it should not be a worry.

Walter

I would seal completely, and the use of desicccants would be just in case there was a leakage of outside, humid air.

Thank you. So I will totally seal the cartons, that is clear.

But should the container be completely sealed also or is it better to have some ventilation? If I remember correctly and if I understood it well, you once said that if the outside temperatures are high then we should not have a totally sealed container because or else it will get too hot inside. The container should have some ventilation.

But then also the question arises through which route the ship will go to (China --> Netherlands) and maybe some parts of the route is cold and some hot. I have tried to find sea temperatures for the different seas and there isn't much data on the temperatures.

Maybe I am just overthinking it...

 

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[LPPC]

I think you are overthinking it now. At sea, regardless of route, the temperatures don't fluctuate very much and humidity is not a problem.

Yes you should not totally seal the shipping container because any air movement in and out can help prevent the inside reaching extremely high temperatures.

Walter

Thank you very much Walter. All will be well then.

 

[LPPC]

Hello Walter,

Here I am once again. I have some questions regarding an order on Alibaba and I would appreciate it if you could take a look.

A) I have created a PO (purchase order) in pdf form where I listed all the details and specs of the product. Can I just send it to the supplier and ask to attach it to the contract generated by Alibaba? I did see a part on the generated contract that says:
"product quality standards'' ''attachment files''

If yes, can I just write ''see PO attached'' under the ''product quality standards'' field or do I need to outline the complete specs in that field too, on top of attaching the PO? It would be really hard to fit every product detail into that field and also maybe images are not possible.

B) Does the PO file need to have signatures of both parties on it or is it enough if the supplier attaches it to the contract generated by Alibaba without signatures?

C) I will have the good inspected before shipment in China. Is it better to choose pre-shipment Trade Assurance coverage or post-shipment because then I can double check the shipment when it has arrived?

D) The supplier will send it to the port in China and I have to pay for it. She will also buy the customs document for export. My forwarder takes it from there and ships it via sea.
But on the order page now it says ''EXW'' and ''EXPRESS'' as shipping method. Shouldn't it be ''Sea'' instead of ''Express'' and also ''FOB'' instead of ''EXW''? This is important for the Trade Assurance deadline, because they take 15 days from date of shipment for express shipments and 45 days for sea shipments.

Also I think my supplier has to upload a document that will be delivered by my forwarder that states the date of shipment via sea? Again this is important for the trade assurance deadline.

I would have asked the Alibaba customer service, but they seem to be very unknowledgeable so far.

Thanks a lot in advance!

 

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[poepe]

Hello Walter, well done on the thread.

Please i have plans on sourcing for digital photo frames but i'm more particular about the shipping safety and the best country to source between China/Veitnam.
Also as it is a breakable and easily damageable product with a lot of room for factory error - chargers, battery, colour pixels etc ; what would you advise?

 

[LPPC]

Hello Walter,

I am trying to decide on whether it is better to do pre-shipment inspection by one of the 3 big inspection companies (necessary for Trade Assurance application on Alibaba), or the cheaper newer one in your book. The 3 big inspection companies are 50% more expensive. I have arranged 30% payment pre-shipment and the rest will be paid after inspection.

Let's say I decide to go with the cheaper inspection company and they find that it is a bad batch. I then have two options:
A) I will decide that I will not give the supplier another chance to fix the batch. In this case I don't think Alibaba will refund me the money, because I am not being cooperative by not letting them fix their mistakes. Also it will be hard at this moment to find a better manufacturer and I am running out of stock soon.
B) I will decide that they get a chance to make the batch better. Then I think after this, it is wise to do another inspection (second inspection)....right?

Now I don't see here why it would be better to use the 3 big inspection companies for the first inspection, since the first time I will most likely not apply for Trade Assurance. If after the first inspection they find that it is a bad batch, then it would be wise to have the 3 big inspection companies inspect the revised shipment (second inspection), because if even then it has not been fixed, it would be wise to apply for Trade Assurance.

Would you mind to share your viewpoint on this? Am I overlooking something? I have already bought a big batch from this supplier before and had it inspected by the cheaper inspection service, both went well.

Thank you as always Walter!

 

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[LPPC]

@LPPC The only real problem with your idea is that you have to apply for Trade Assurance at the time of placing the order.

Knowing the history of your experiences with this product and supplier, I would be inclined to inform them prior to placing the order that you intend have a quality inspection carried out before shipment, and if the inspection service rejects them, they would have to make a new batch or fix the one that was rejected.

This should keep them on their toes and ensure that they maintain top quality control.

You could even tell them that this would involve another inspection and you would expect them to pay for that. They might agree.

Walter

Thank you for the prompt reply!

Good idea indeed to ask whether they are willing to pay for the second inspection. And yes, i have warned them about the inspection taking place.

I don't understand though. Why would I have to apply for Trade Assurance at the time of placing the order and why would this be a problem? My supplier has already created the order via Alibaba and I have paid 30% via their system. Please enlighten me.

Good that you remember the previous fiasco with that supplier fortunately though, this is a different supplier and their first shipment was allright.

Looking forward to your reply!

 

[Xeon]

Hi Walter, I was browsing Alibaba and notice that some of these manufacturer's profile pages there on the site have photos of themselves shaking hands and posing with their other clients. Is this a reliable factor in determining how reliable they are (e.g: it shows that they're a factory and not some middleman)?

 

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[LPPC]

You can't apply for Trade Assurance after the deposit for the order has been paid.

Walter

How can that be? Trade Assurance is meant for protection after having paid for the order.

Or is it different if you place a deposit first and then the full amount after inspection? I have read the Trade Assurance rules but can not remember ever having read that. Care to point me to the relevant clause?

Thank you!

 

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[LPPC]

Trade Assurance cover kicks in after you have paid the full amount, but you must reach agreement with the supplier before ordering otherwise you could find that they won't use Trade Assurance on that particular order.

Although they advertise that they offer that service, they are not required to do so. It's their prerogative to decide with each order.

Walter

Thank you very much Walter.

In that case, if I'm correct it still does not matter whether 1st inspection will be done by the cheaper inspection service or by the big 3. The reason for this is that at the moment I have paid 30% upfront on Alibaba. If I can only apply for Trade Assurance after full order has been paid, then after the inspection company rejects the batch, I would first have to pay the remaining 70% in order to be able to apply for Trade Assurance. I think it would not be wise to pay the remaining 70% if the batch is not good, just to be able to apply for Trade Assurance. In that case I would rather lose 30% than take the chance of losing another 70%, because as you said Trade Assurance is not what they promise it to be.

Just a recap, my original theory was that it would not matter whether for the first inspection of the batch you would choose the cheaper inspection company or one of the 3 big inspection companies chosen by Alibaba. Reason for this is that after the cheaper inspection company rejects the batch, I will give the supplier another chance to fix the batch and then do a second inspection. Only this second inspection should be done by one of the big 3 because this inspection report would be used to apply for Trade Assurance.

Sorry if I seem stubborn or sound like a smartass. I just like to have this figured out so that I know for all future orders which inspection company to choose.

Thank you for your time and efforts!

 

[Xeon]

I have found quality of products from Vietnam is generally better than those from China. This is probably due to a different work ethic. Labor in Chinese factories has been conditioned to finish the job at a very fast rate in order to maintain profit levels for the factory owners.

Workers in Vietnamese factories that I have seen appear to have been under less stress. That might change but so far it looks good.

You will need to provide very detailed and precise specifications before you even get a quote. With the products being so fragile it is worthwhile to include packaging requirements.

From the few Vietnamese manufacturers I've contacted in the past, the general feeling I got was that all of them only take (very) high MOQs. At least with the Chinese manus, it's still possible for some of them to give a bit of leeway.

Also, regarding Chinese manus, when you get a product made there, do you ask them to sign a contract stating they cannot sell your product or counterfeit it? Does it actually help though, or is it just a waste of time and I should just let it be?

Thanks!

 

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[Blackman]

Hi Walter,

What is your experience in importing from Taiwan?

I found a genuine manufacturer there who can supply exactly what I need at a great price, but for some reason they are hesitant to supply me in the UK, referring to "very expensive" shipping costs for small orders?

I'm already buying the product in question from various Chinese suppliers with no problems at a reasonable shipping cost, so can't see a reason why they don't want to supply?

They are asking for a higher MOQ, but I'm confident they are a manufacturer, rather than a trading company, although it is widely accepted by other companies in China to supply my product in smaller quantities, such as 10/20/30, instead of 100+ ?

I am sure I could find a freight forwarding company to organize the shipment for me from Taiwan to the UK, but I was hoping to stick with simpler solutions at this stage by just using air couriers, since it has worked well for me so far.

Let me know what you think.

 

[Walter Hay]

Today I received a question from a member, and I think his question is one that could stump a lot of members if their suppliers gave the option that his supplier offered.

This question is of extreme importance. Making the wrong decision could result in the total loss of a shipment. It is really only relevant to large shipments for which a Bill of Lading is issued.

Question:
So my finished product shipment is almost ready to be transferred to my freight forwarder, and the supplier asked if I wanted an "official Bill of Lading" or a "Telex Bill of Lading."

Do you think that a Telex Bill of Lading will be adequate for this?

Answer:
I would not accept a Telex Bill of Lading. Something as simple as poor English could lead to the shipment being released prematurely or to the wrong party.

BTW, although the term is still used, Telex has now been replaced by emails, and this greatly increases the risk.

Further explanation: A Bill of Lading (BL) is a document that is accepted by shipowners, port authorities, banks, and insurance companies, as proof that a shipment has been loaded on board a ship, or even a truck in some circumstances. It is not generally regarded as equivalent to a Waybill, although since 1992 in the UK what they call a Sea Waybill is acceptable as proof of ownership.

If you have a good freight forwarder, you needn't worry about such details. The only other technicality I would suggest that you remember is that a Bill of Lading, to be readily acceptable to your bank, should be a "Clean On Board" BL. A Clean On board Bill of Lading certifies that the cargo on board has no negative clause, notation or remarks on the quantity, quality or packaging of goods.

Walter

 

[Blackman]

Hi Walter,

A few quick questions about sea freight.

I've sent out inquiries to a number of UK based freight forwarding companies to get a few quotes and compare the prices.

1. My product comes in a carton with the dimensions being 98*57*83cm, 23KG - that is the 1 carton size, which contains 10 units of my product. I was thinking of ordering 3 cartons (30 units), but I'm not sure if this quantity is big enough to get best shipping prices to justify sea freight?

Would you advise going for a bigger quantity, as so far I've only received 1 quote for sea freight, but the total landed cost per unit (including the product cost, shipping and all the customs fees) works out only £10 cheaper per product compared to using an air courier.

However, I have to mention that the maximum amount I've imported using an air courier has been 10 units (1 carton). Now if I was to calculate the difference of importing 30 units using an air courier vs 30 units by sea freight, then I'm sure the difference would be a lot more significant.

2. Would you recommend letting a UK freight forward company handle the whole shipping process from my suppliers address in China all the way to my door in the UK?

I've read that FOB prices quoted by Chinese suppliers can work out cheaper, rather than importing under EXW terms, but I would rather keep things simple and let just one 1 company deal with everything to avoid any misunderstandings with customs, etc.

3. A choice of UK freight forwarding companies is pretty huge, so I would appreciate if you could recommend anyone in the UK that you have dealt with and know well?

Thanks for your help

Stephan

 

[Blackman]

@Walter Hay

Thanks for the tips, Walter.

John Good was actually one of the freight forwarding companies that I have already sent out a quote to, so let's see what they say.

As for the order quantity, I did think that 30 units was a bit too small for sea freight, but unfortunately importing such quantity using air couriers leaves hardly any margin for profit. I don't arrange any shipping myself, all the prices are given by my supplier for a door-to-door delivery. Last time we used EMS, which was ok, but I'm looking into alternative shipping methods.

With regards to see freight, say if I was to go for a bigger quantity, am I right in thinking that the best way to do it is to get an FOB price for the product from the supplier and the name of the port, then get a quote from a UK freight forwarding company for a door-to-door delivery (port in China to my door in the UK, including all the customs clearance both in China and the UK)?

This must work out cheaper, rather than having the freight forwarding company collect the goods directly from my supplier's premises (EXW price) and then deal with transportation to the local port? Surely, it would be cheaper for my supplier to get the goods to the port?

 

[Sam McLaren]

Hi Walter,

Echoing everyone else's messages - thank you for your book and the effort that you make to answer everyone's questions. I will likely send you a PM to expand/add extra detail to these questions (and add a few more), but I would love to give back to the thread by contributing my questions and any successes/failures along the way.

Against your great advice, the product I am keen to source is custom designed and relatively bulky. The product type is classical - ours is just a different design which doesn't necessarily innovate in a significant way, but cosmetically will appeal to a niche market strongly. A similar product is already on the market and is in such high demand that customers pre-order it without a strict delivery date (i.e. which seems to be 2-3 months i.e. lead time and likely sea freight once the owner has enough to pay for their MOQ I'm assuming). The product (timber/MDF base) has to have a high quality finish (painted in one custom PMS colour throughout) and be accurate as it will be shipped flat packed and put together by the customer.

As it is a custom product, I'm currently at the stage where I am just researching whether or not it will be viable. Our competitor product has a high RRP, but the market is *easily* bearing it, we have improved the design, will offer much better service and on the surface the landed cost has the possibility of several multiples under RRP, meaning that we wouldn't have to rely on much sales volume to make it worthwhile. To start with, we would like to market test the one design with two different size options, and three colour options. We have the exact design specifications in CAD software.

Before I came across this thread, I reached out to several suppliers on Alibaba - most were very helpful and their quotes were competitive, however they seem like traders and I just didn't have the confidence they could produce the product to the quality I was after (lots of Yes's when I showed examples, but they lacked any evidence of a similar level of finish).

Since reading through the book in particular, I have changed my search terms and have started researching the sites listed in the book, which seem to have products much more in line with what we want. However these are my questions:

1. With my initial outreach emails, would you still ask for a product catalog and build some rapport, or would you open with our need for a custom product?

2. I understand the probability that the product may/will be copied (however as it's not truly innovative - just a different design, I'm hoping they are less likely to do that. For example like a toy car - there are millions of variations so the category is diluted enough and our "toy car" is basically just cosmetically different - but with our target market that difference is really important for purchasing). Therefore for suppliers to quote/make judgement on whether they can do it, I'm assuming I need to provide the design up front - in this case do you think that is OK - or is there any other work around?

3. I know there are probably pros/cons of each, but for a bespoke, high end product like ours, would you recommend a larger, more experienced manufacturer that has the record/expansive product list/product safety certifications or a smaller manufacturer? Although on first read a larger manufacturer may have the processes in place for high quality, I get nervous that we would get bumped for larger orders (i.e. for factories currently supplying department stores).

4. In relation to above, would there be anything stopping a larger manufacturer sharing our design to such department store for them to produce and sell at a scale much higher than ours?

5. If a manufacturer looks to meet the criteria you have mentioned on one of the sourcing sites listed in your book, but they also have an Alibaba page - is there any difference on what site you would make contact through?

Thank you so much in advance for any assistance you could provide regarding the above.

Sam

 

[Walter Hay]

@ Sam McLaren,

First let me say that you were well advised to not deal with traders for your requirements. There are cases I know in which traders not only slowed the process, but although there was no language problem between them and the manufacturer there were serious problems with the traders' inability to communicate the buyer's requirements.

In answer to your questions:
1. Yes, I would still follow that procedure, because it helps build a relationship. Also, when you introduce the subject of your custom needs. it shows them that you have not chosen them at random.
2. I think you may be right that they might not bother using your design for other customers, although the risk still remains.
3. The bigger manufacturers are definitely more likely to be dealing with big buyers, and that can result in them shunting your orders aside to handle the big ones.
4. I think there is a high risk of that happening.
5. I would avoid Alibaba whenever possible. If you have not yet done so I suggest you look for relevant manufacturers in Malaysia or Indonesia. Those countries have substantial furniture manufacturing experience, but I would also look elsewhere. You should also consider the potential freight savings in having the products made locally.
Even local cabinetmakers would have the capability to handle the type of work you want done, and the materials are manufactured in many countries, such as the Nordic countries, USA, Australia, and New Zealand among others.

Walter