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Sourcing Alibaba (Product Creation)

Discussion in 'Product Creation, Inventing, Importing, Sourcing' started by sparechange, Jul 25, 2018.

  1. sparechange
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    sparechange Gold Contributor Speedway Pass

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    I've talked with a few different suppliers and none are interested in making a new product. One of which is my current supplier for my inventory.

    Is this a normal thing? I'm assuming the majority on Alibaba are just trading companies and not legit factories?

    The product is fairly simple to make, just need it mass produced. (Cant make it myself)
     
  2. MTEE1985
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    MTEE1985 Silver Contributor Read Millionaire Fastlane I've Read UNSCRIPTED FASTLANE INSIDER Speedway Pass

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    Your assumption is correct. @Walter Hay is the go to guy here in regards to your question.

    From my experiences if it is very minor tweaks to an existing product they sell I can usually source through alibaba but anything more and you’ll have a hard time.

    When I look at developing a new product I look in the U.S. first (or whichever country you are in) simply because the language barriers and working hours synchronization make the process quicker and easier. If I can get it made here I will, but if nothing else I’ve found it’s the quickest way to understand the viability (or not) of manufacturing it.

    Hope this helps!
     
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  3. sparechange
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    sparechange Gold Contributor Speedway Pass

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    Ill try to see if I can find some suppliers in the US or Canada (In Canada), assuming it will be double or more in production cost though.
     
  4. MTEE1985
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    MTEE1985 Silver Contributor Read Millionaire Fastlane I've Read UNSCRIPTED FASTLANE INSIDER Speedway Pass

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    Without a doubt yes, it will cost more. At this stage however it sounds like you’d benefit more from discovering whether it can be made/mass produced in the first place?

    Making an assumption on my end that it isn’t a $1,000+ product to manufacturer a sample then your potential cost to get it done in North America may well be worth the headache saved trying to manufacture overseas *at this stage*

    Once you have a sample/samples that you are satisfied with you could then look into production costs and overseas sourcing OR you could continue to manufacture here and adjust your price accordingly with hopefully a higher grade product then you would get from China etc.
     
  5. sparechange
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    sparechange Gold Contributor Speedway Pass

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    It can be mass produced for sure.

    Ive sent out some emails (CAD/US), we'll see what I can get back
     
  6. Longinus
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    Longinus Platinum Contributor Read Millionaire Fastlane I've Read UNSCRIPTED FASTLANE INSIDER Speedway Pass

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    Indeed they are, but that's not always a bad thing since very little people in China speak English. If you're Chinese and speak a little English, you can easily open a "company" on Alibaba and source on 1688.com. The companies listed on the latter won't even respond on English emails.

    Perhaps you can find a sourcing agent on Upwork and ask that person to find the company you need.

    If you can speak Chinese AND English you're actually holding very valuable skills.
     
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  7. Walter Hay
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    Walter Hay Legendary Contributor FASTLANE INSIDER Speedway Pass LEGENDARY CONTRIBUTOR

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    The vast majority of suppliers listed on Alibaba are trading companies, although most of them pretend to be manufacturers. This is why I devote so much space in my book to teach how to tell the difference. You have probably been corresponding with these fake "manufacturers."

    Almost without exception, manufacturers in China employ English speaking staff. Their English is not always 100% and that is why in my book I explain how and why to use simple English and avoid the use of words that can have two or more meanings. It is also why email correspondence is more effective than voice communication.

    See my post yesterday on the thread INTRO - YOYBUY Online shopping agancy regarding sourcing agents. The great majority of sourcing agents in China pose a real and present wealth risk for newbie importers.

    I would not expect double or more the production cost if sourcing in the US or Canada. It does happen, but in many cases that I have seen recently, the cost is only slightly higher, but it provides the great marketing advantage of putting Made in Canada, or Made in USA on the label. It also provides far greater IP security and less risk of copying, at least until you have entrenched your position in the market.

    Please consider countries outside of China. There are many other options for product sourcing, and there are many countries where IP is protected.

    Walter
     
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  8. B_Mac
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    B_Mac Bronze Contributor Read Millionaire Fastlane FASTLANE INSIDER

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    @Walter Hay Concerning cost difference between China and US manufacturers, does that only apply to someone making a new product that requires significant customization, or across all products?

    I've recently was looking at something to which I wanted to make some minor changes. I found something similar and asked a Chinese manufacturer to quote it. Based on the price they gave, I estimated I could land that item for about $12. Multiple US manufacturers quoted $25 plus whatever shipping would have been.

    I thought this was perhaps due to the low value of the item, and more valuable items may make more sense with US manufacturing.
     
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  9. Walter Hay
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    Walter Hay Legendary Contributor FASTLANE INSIDER Speedway Pass LEGENDARY CONTRIBUTOR

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    As a general rule, such big cost differences would be encountered when the manufacturing process involves big set up costs, most often molds.

    US made products sell well in many countries where they compete with Chinese made goods. It is almost impossible to identify a pattern, but I have observed this on a retail level in relation to many products.

    I see retailers selling quality items made in Western countries and they are at or not far above the prices being charged for Chinese made items. I know that this is partly explained by the excessive margins often obtained by retailers who have become greedy with the availability of cheap and often nasty, Chinese products.

    In the US there is a tendency to want to make too much profit on the cost of setting up, so buyers need to negotiate. If suppliers adopt a "Take it or leave it" attitude, look for ones that are more reasonable.

    There are plenty of smaller manufacturers who will talk turkey. I know a small, labor intensive, technical product manufacturer in Boston that continues to enjoy a highly competitive position, in the face Chinese made substitutes. If someone is searching for that product type they might not find them unless they persevere.

    Walter
     
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  10. steelandchrome
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    steelandchrome Author of The Retail Leader Book. Read Millionaire Fastlane I've Read UNSCRIPTED FASTLANE INSIDER Speedway Pass

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    I am trying to get pricing on making a new item myself and tried both domestic and in China. I got pretty consistent pricing from China on the item itself, domestically I was told the item is too complex and they aren't even interested in quoting it. Funny thing is it is just a simple silicone item but with multiple colors at once so not a huge thing but it's not up the alley to even get a price to see the cost locally. The Chinese manufacturers did have a big range of $500-1200 mold fees and some even offered to come up with the vector file for $500 if I wanted since I haven't made one yet.

    Sent from my SM-G935V using Tapatalk
     
  11. Walter Hay
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    Walter Hay Legendary Contributor FASTLANE INSIDER Speedway Pass LEGENDARY CONTRIBUTOR

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    Look for local manufacturers of silicone keychains. They would have the capability of making such items and their mold cost is probably going to be moderate because of their expertise in multi color injection molding.

    Most suppliers of such keychains in the US or Canada almost certainly source from China, so you might have to do some thorough searching to find a real manufacturer. Don't bother looking at companies that identify themselves as promotional products suppliers, particularly those that offer 40,000 products.

    Almost any plastic injection molder will be able to make the product for you, provided they know how to deal with silicone, but they might charge a lot for the mold.

    Walter
     
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  12. steelandchrome
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    steelandchrome Author of The Retail Leader Book. Read Millionaire Fastlane I've Read UNSCRIPTED FASTLANE INSIDER Speedway Pass

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    Thanks. Thats funny that I have been showing the manufacturers pictures of keychains to get my idea across :)
     
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  13. MTEE1985
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    MTEE1985 Silver Contributor Read Millionaire Fastlane I've Read UNSCRIPTED FASTLANE INSIDER Speedway Pass

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    Thanks @Walter Hay for all the input! If a thread exists already forgive me for asking this but what are your thoughts these days on “Made in USA” vs made in China/Indonesia etc as far as premiums people will pay and quality?

    I source whenever possible from the U.S. and know many people who say they will spend more to buy something made in the U.S. but at the end of the day the almighty dollar wins and the lowest price prevails regardless of country of origin when it comes to competing products.
     
  14. sparechange
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    sparechange Gold Contributor Speedway Pass

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    lol wow, so im getting drop shipped on basically. @Longinus

    @Walter Hay I'm looking into sourcing a factory locally, sent out two emails in the morning and still haven't received a reply.

    Ah... I guess the harder it is to do this the better, in regards to the second law of entry.

    Ill try the up work suggestion aswell
     
  15. Walter Hay
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    Walter Hay Legendary Contributor FASTLANE INSIDER Speedway Pass LEGENDARY CONTRIBUTOR

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    First you might like to have a look at my post GOLD! - 6 Figures At 18! 1 Year of The Fastlane Forum in which I mentioned the benefits of sourcing your products in the USA.

    Consumers are fickle creatures. Almost everyone will pay lip service to the idea of buying US made products, but you are quite right, in reality most will buy on price.

    That quite often comes back to bite them. We live in a disposable society, but Chinese manufacturers have perfected the art of making products down to a price. They place little value on quality, and shoppers who buy on price are not always saving money.

    If a product fails soon after any warranty expires and has to be replaced once, effectively that doubles the price paid.

    So to answer your question: There is a market segment that will pay premium prices for quality, and if your costs are substantially higher than buying from China, you have to identify and target that market.

    Your niche will then not be restricted to the type of product, but more importantly to the type of customer.

    Walter
     
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  16. Walter Hay
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    Walter Hay Legendary Contributor FASTLANE INSIDER Speedway Pass LEGENDARY CONTRIBUTOR

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    @Walter Hay I'm looking into sourcing a factory locally, sent out two emails in the morning and still haven't received a reply.

    Ah... I guess the harder it is to do this the better, in regards to the second law of entry.

    Ill try the up work suggestion as well[/QUOTE]
    @sparechange
    You need to give a lot of thought to your first contact email. Just as I recommend when approaching Chinese manufacturers, don't let them know you are new to the business.

    Have you tried thomasnet ? There are filters you can use to narrow your search. If you have my book, check out Ch. 19 where I give detailed instructions on how to search that site.

    If you get stuck, let me know via PM and I will see if I can help.

    Walter
    P.S. Thanks for the rep transfer. It's nice to know I am appreciated
     
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  17. sparechange
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    sparechange Gold Contributor Speedway Pass

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    Never heard of thomas until now! Giving that a look around.

    As of the emails I sent out there have been no replies, I keep them simple, maybe to simple.
     
  18. Arun Siva
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    Arun Siva aspiring 大君 of the bourgeoisie Read Millionaire Fastlane I've Read UNSCRIPTED FASTLANE INSIDER Speedway Pass Summit Attendee

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    If you need any help with the manufacturing/quality side of your venture feel free to PM me. Be glad to help.
     
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