As a business owner, you must be aware of the power of creativity. The ability to use our gray matter in crafting ideas that are unique and compelling serve as a foundation for a business that is able to withstand external pressure. Individuality is a blessing in disguise and the business owners who know this secret can craft formulas that can catapult their entity into immeasurable heights of success.
While deciding upon a niche, you must have come across many product ideas that you think would do wonders. But when it comes to source the product idea, many business owners have no clue where to begin from. Whether you are looking to get manufacturers to develop your ideas into durable products or are searching for suppliers that you can purchase from, it often turns into an intimidating task, if you are not sure where to begin from.
In this feature we would be discussing different methods to get a manufacturer or supplier* for your product idea conveniently.
*For the sake of convenience, we have used terms manufacturer or supplier. However, they also include wholesalers and distributors and can be used interchangeably.
Know What You Want
Before you begin your hunt for finding the right manufacturer or supplier, begin by doing your homework. Digital advancement has made everything easy including helping you decide where you want to steer your business in future. Just Google about product ideas and you can get meaningful insights. It’s important to be clear on the following points before you start looking for a supplier or a manufacturer.
The foremost point is to know what kind of supplier you are looking for. Usually, most business owners are not aware of the difference between the terms manufacturer, supplier, wholesaler and distributor. You should ideally look for
- Manufacturer to develop products based on your unique idea.
- Supplier who can also act as a manufacturer, wholesaler or distributor to buy products and brands from you.
- Dropshipper to deliver your products to your clients, catering for orders of existing brands and products
Difference Between Local & Foreign Suppliers
A challenging decision that business owners are faced with is to determine whether they want to source from overseas or just want to focus on local markets.
While sourcing products from overseas can considerably lower upfront cost and cost per unit, there are other factors that you have to take into consideration before choosing this option.
Whether you are choosing local or international suppliers, you will get entitled to some advantages along with certain disadvantages. Let’s have a look at the pros and cons of both options.
Choosing Local Suppliers
Pros
- Improved product quality and labor practices
- Smooth flow of communication due to same language
- Convenient to look for reputable manufacturers
- Quicker shipping
- Intellectual Property protection
- Sound payment and transaction methods
Cons
- Increased cost of manufacturing
- Lesser variety available to choose from
Choosing Foreign Suppliers
Pros
- Decreased manufacturing expenses
- Access to large number of manufacturers
- Using options like Alibaba can help you look for suppliers
Cons
- Customer dissatisfaction for foreign products
- Inadequate manufacturing and labor standards
- Less or no intellectual property protection
- Barriers such as language difference
- Extremely cumbersome to identify genuine manufacturers/Difficulty visiting them on-site
- Prolonged shipment times
- Cluttered business experience due to cultural differences
- Custom clearance problems
- Uncertainty regarding payment security
Where Should You Start From?
Now that you are clear on where you are headed, it’s time to focus on your starting point. The best place to begin, without any doubt, is Internet. Along with digging deep into the Internet, there are some places that can aid you in this regard.
Web Directories
It’s a good idea to look into online supplier directories. These online resources are filled with information about thousands of suppliers that you can conveniently reach out to. The most popular options for finding both local and foreign suppliers, manufacturers and wholesalers are listed below.
- Kompass
- Makers Row
- MFG
- ThomasNet
- Alibaba
- Bambify
- Sourcify
- AliExpress
Search Result’s Previous Pages
Though you might be keeping pace with Google’s changing policies and its algorithms, most of the suppliers don’t focus much on updating their profiles or information in accordance to Google’s latest policies. So while you are at Google’s top page, it can also pay to have a look at the previous pages. You might actually find a good supplier who doesn’t rank on top pages of Google. Suppliers whose websites are not search engine optimized doesn’t mean that they are not reliable to work with.
So you really want to fish out the best supplier for yourself? Just don’t limit your focus to the first page and explore search results beyond 10 pages or even more. You are most likely to end up getting across the right supplier that you wanted. To have more options, consider using different keyword terms such as wholesalers, distributors, manufacturers and suppliers.
City Library
To conduct a comprehensive search, try an old school method. Dust off the dirt from your library card and head towards the city library. Some libraries have databases about manufacturers and suppliers, for which they pay a hefty amount. This information is not readily available, therefore, paying a visit to your local library might do you some good. Just make sure to call them before you head out, confirming whether they have such a database. For bigger libraries, hold a conversation with the technology or business section.
References
References work wonders. In this case too. Consider benefiting from the experience of your close friends and family members. Networking on social platforms can also help you gain valuable information.
The more you get information about suppliers, even if they are not the right choice for you, you can work your way towards finding the best one for your by getting references from the ones you have already contacted. Since they are working in the industry, it is highly likely that they would be familiar of someone that might fit your needs.
Other Options
If you run your business in America or Canada, another method to look for product suppliers is to look up your products using their NAICS codes.
NAICS stands for North America Industry Classification System that attaches unique codes to products from all industries. Listing products with these codes makes it easier to find suppliers. This is particularly true if you are using professional directories.
You can get your hands at NAICS directory at your city library or on the Internet.
Offering A Quote
Once you have found a supplier that you have been looking for, you have won half the battle.
Now it’s time to focus on remaining half.
The next step that follows after finding out a suitable supplier is to get in touch with him.
While email correspondence won’t be problematic for you, it is addressing your supplier’s main concern that can prove to be somewhat challenging. Deciding on how much you are willing to pay your supplier would require some serious brainstorming from you.
Haste makes waste. Rather than hurrying back to your supplier with a random quote, take out time to evaluate all the aspects. Keep in mind the points that you want to stress on and any questions that you want to ask. Creating out a draft before you send the email will help you gain useful insights and correct information that can serve as a basis of valuable relationship in the future.
While creating a draft, you should consider the following points,
- Considering your Minimum Order Quantity – Before making any promises figure out how much your supplier’s Minimum Order Quantity or MOQ is. Based on the type of products that you are dealing with, the price and quantity can vary, and it’s best to determine how much you can afford beforehand.
- Sample Pricing – Getting a few samples can help you analyze the quality of the product before you place the order. Depending upon the industry that you are dealing in and the products that you are looking to purchase, sample pricing can vary greatly. Your supplier can charge you at retail price for the sample, offer a discount or send them totally free.
- Production Pricing – An important question to pose to your supplier is how costly your products would be? Make sure you ask for bulk prices to get an estimate of how much you would be paying when you get larger quantities supplied.
- Turnaround Time – Time is money when it comes to business. Ensure that your products won’t take too long to get to you.
- Payment Considerations – Payment terms are a crucial factor when it comes to dealing with suppliers. Some suppliers look for getting upfront money, while others are okay with deferred payments. Considering your own financial situation, you should decide on terms that are suitable for both parties.
Suppliers are always being reached out to many people, some of them who are just “experimenting” and not considering a serious relationship at all. Therefore, if your supplier doesn’t respond to your initial email, this means that you should try again. Have a thick skin and be prepared for a lack of response from your supplier for the initial few emails that you send in.
There are some effective steps that you can take to get noticed. In order to get a prompt response from your supplier, avoid doing the following:
- Sending long emails – Your initial email to your supplier should be clear and to-the-point. Overly long paragraphs with unnecessary information can make it difficult for the supplier to read till the end. It’s good to focus only on assessing the nature of your relationship with your potential supplier for a high level quantity. Skip details about your background and business details. Try conveying to your supplier the things that he would be interested in only.
- Being needy – In order to get a clear picture of your relationship with your potential client, you should ask for a multiple quotes for different quantities. However, asking too much can make it cumbersome for your supplier to provide you information with, which in turn can lead to delayed response. Solely ask for information that would be helpful in determining whether you two can fit in a relationship.
- Not asking enough information – Quoting below your potential supplier’s minimum order quantity is most likely to be met by silence. If you are unable to assess what the minimum order quantity would be, it is best to inquire with a short email before formally beginning the correspondence.
If you are contacting a foreign supplier, then it is most likely that a program would translate your email into local language. Therefore, it is vital to keep the information concise and the email error-free to get a prompt response. Try bulleting your queries so that each one of them can be addressed adequately with the communication organized.
Following is a format that you should keep in mind while sending an email to the supplier for the first time.
Hello,
This is Tracy from RDX Sports.
I want to place an order for Boxing Gloves A. However, there are a few questions that I want answered first.
- How much is your Minimum Order Quantity?
- How much is per unit cost for Minimum Order Quantity?
- What would the cost be if I order 5 X Minimum Order Quantity?
- How much do you charge your new customers and what are the payment conditions?
Please send over a sample of Boxing Gloves A to assess the quality. You can send me the cost of the sample along with shipping charges to the following address,
Tracy Heinz
Peter House, Oxford Street Manchester,
Greater Manchester, M1 5AN
United Kingdom
Thank You,
Tracy.
Keeping your email concise as in the sample above will ensure improved response rate. Asking for a sample will quicken the process, enabling you to assess whether there is a fit between you and the supplier. Once you are sure that you can form a work-relationship, then it’s ok to email other details about your business.
Deciding A Minimum Order Quantity
If this your first time getting a supplier on board, then you will be introduced to the term Minimum Order Quantity. MOQ’s are the least number of products that you need to order from the supplier so that the cost of delivery and other expenses that the supplier has to bear with can be overcome by the supplier. Depending upon the industry and the nature of product, MOQ can go up to hundreds or even thousands of items.
However, you are not always in the position to meet MOQ’s due to your limited funds. Sometimes, you prefer purchasing a select items to evaluate the make and quality before you order big bulks. This is the point where you should consider negotiating MOQ’s.
Before you start discussing about what minimums you are looking to get, it is important for you to have a thorough understanding of why you supplier has set a particular MOQ. It may be due to different reasons. Maybe your supplier wants to conduct business with bigger clients. Or maybe production involves a lot of time and setting up an MOQ would reduce production cost and efficiency.
Once you understand why your supplier has set up a particular MOQ, you can conveniently negotiate your terms. However, you might have to make certain compromises such as paying a higher amount for each unit or place a larger order.
End Note
Finding out the right supplier or manufacturer is an art. For new business owners, it can sometimes prove to be an intimidating task. Sourcing a supplier that perfectly fits your business needs is crucial for your operations to grow. Sometimes, the process may get extremely frustrating, when you get unfavorable or no responses. Finding the right supplier would require a lot of patience but it would pay off greatly in the end.
