are you thinking about buying wholesale products or perhaps you're currently in
the process of designing and want to manufacture a product overseas
maybe you're looking into alibaba as a platform and the solution to actually
make that product that you envision well in this video we're going to dive
into reasons why you should or should not be sourcing from alibaba
as well as five key lessons and tips that you should definitely consider
before purchasing and putting any money or time or effort
into that process so if you're new visitor to this channel i highly
encourage that you guys hit that subscribe button located right down
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be alerted of the latest video drops we've also linked some notes and
resources that you guys can use and that we mentioned throughout this
video which will continue helping you build your brand
on this channel we help entrepreneurs build brands that impact the world
so let's get started over the years we design and manufacture products in
multiple countries mexico us china taiwan and many other
countries cities and states around the world
so we've had some experience in manufacturing and communicating those
needs with our suppliers so in this video we're going to be
breaking it down so whether you guys are sourcing an apparel product
a hard good or maybe even an electronic product like a drift car
or a scooter these are going to be lessons that you guys are going to want
to take notes of in order to successfully
navigate that process and reduce your chances of failure or just getting
that bad batch now the first question i want to ask you
is should you even be sourcing from alibaba and suppliers like them
now the reason i say this is because you should always consider trying to source
locally and trying to see if the product that
can be created locally or in your country
now to expand on that a little bit perhaps you're designing a product
and if you are going to be working with a supplier overseas there is going to be
that language barrier as well as that time difference as well as that
understanding of what it is that you need so if you're able to find somebody
that you can work with in your country or perhaps a few states away
then you could personally travel to that area and actually work with them side by
side to develop that idea that you have when we were developing our bags and our
game bag products if we were to try to source that design
overseas it would have literally taken us a year
to two years to actually get just that one design that we wanted
the reason being is because we had a lot of fabric types that we wanted to use we
had a lot of patterns we had a lot of tweaking that we needed
to do to each pattern to really have it fit the way that we wanted it to fit
so if you're trying to communicate these changes with the supplier overseas
through email a lot of that information is going to be lost in the mix
so you should always consider sourcing locally before going to an overseas
supplier to at least fine tune the design and the
small batch production of the products that you're
creating that way you can actually see them in real time
you can actually sell them in real time to customers in your area
and you can get real-time feedback before you go spending a couple thousand
dollars to create a couple thousand products and
then get something that's mediocre which leads us into the
next lesson which is communication is key now when you're designing a product
from the ground up from your design to sketch to the actual production
the most important thing that you can produce and provide to the manufacturer
and the person that's making your product
is called a tech pack a technical specification
sheet essentially is another term for it but what this does
is it essentially allows you to call out important features
sizing dimensions or just important information that's related to the
production of that garment or of that product
tech packs are a great way to communicate exactly what it is that you
want versus just telling them hey i want this
mixed with a little bit of this and then can you add a little bit of
zippers and a little bit of trim because words can easily be lost in
translation so you always want to provide a visual representation of what
it is that you're talking about in order for them to be able to take it
to their person that's working on those designs
and actually be able to explain it to them now communication also consists of
keeping your words short concise but to the point
don't go rambling about a bunch of different things through an email if you
are going to be working with a supplier overseas
don't start writing bunch of paragraphs hoping that they understand exactly what
you meant because a lot of the times they're not
going to be able to decipher everything that you're trying to say
so a tech pack is going to be key it's going to be gold it's going to be the
way that you guys need to move forward if you're going to be working with an
overseas supplier so now that you're clear with your
communication and you know what to produce the next thing you need to do
is actually source and choose the correct suppliers and manufacturers to
produce your goods now if cobit has shown us anything is
that manufacturing and logistics can be held up at the ports it could be
held up in their country they could have laid off a lot of
workers and now a lot of the jobs and products that you were hoping that you
were going to get your hands on are going to be held up for months or
even a year now what this means is that you should
always have backup suppliers in the mix to be able to go from one to
the other if anything like this should happen in the future
now the most important thing with working with multiple suppliers is
realizing that you need to start the communication
early on in the process so when you choose one supplier always
have at least two or three ready in the mix
and communicating your needs with them so they at least know what it is that
you're working on now once you guys get that ideal product
sample from your suppliers you're able to ship it to
the other two or three so everybody knows what product it is that you're
creating so if anything should happen where
things are backed up you can go to supplier 2 and say hey this is a product
that we're making we're back on right now one of the
biggest hit industries is the print on demand in the us
and not because they are shutting their business down or because business is
slow it's actually the opposite the demand
has increased so much that it's hard for them to meet that
demand and it's hard for them to scale up to meet
the customers that they're now getting so whenever it comes to working with
suppliers realize that at times your supplier
could be really willing and open to working with you and
doing everything that they need in order to get your business
but as soon as business ramps up and there's other customers that are
producing volumes way higher than yours they may move you
to the back so just be cognizant of that and always have some backup suppliers
ready for you to move and navigate this crazy turbulent industry which leads us
into the next lesson and that's requesting
samples of the products that you guys are designing don't skimp out on this
process a lot of times people don't want to wait on the delay
to get their sample and they just want to go to market or maybe the cost is a
little too high sample costs vary between production and
your minimums that you're ordering oftentimes they might actually be able
to refund or give a credit towards a production if it's high enough
but the key here is to request that sample because you need
a physical representation of what it is you guys have been communicating with
not just photos you actually want to be able to see it touch it smell it feel it
wear it you want to be able to move around in it you want to be able to use
it as you as a functionality in tens and if it
doesn't work for some reason you need to be able to actually provide those
detailed notes and feedbacks on how to make it better
now this is definitely going to increase the time for you to get your final batch
and this might increase your cost in the initial production run
but at the end of the day the sample is going to be the thing that is
representing what's actually going on the factory floor
and if you're not getting your sample and providing that feedback
everything that falls in line in regards to manufacturing is going to be on you
so now that you guys have confirmed that you're going to get the right product
the next lesson that we're jumping into is payments and the ordering process now
you need to be able to secure your payment and you need to be able to
secure the order that you're placing in order to make sure that
you're getting the right product in the right order now what i
mean by this is that you might have communicated everything
that you wanted right you did everything right you created a text pack you
created the specifications on email you communicated through photos wechat
video chat snapchat all these different chats right
you guys like have dived in on exactly what it is that you wanted
and now comes a time when you have to submit the payment and you have to
submit the order agreement right a lot of times manufacturers will
give you this agreement that i'll state this is how many products you're
ordering this is the potential delivery dates
this is our manufacturer warranties etc etc
in those agreements you need to be sure that you include clauses or
verbiage that states exactly what the product should function and do
now what i mean by that is the first time that we got into this business we
placed an order of about seven thousand eight thousand dollars worth of zippers
now the zippers were a key component of our
product at the time which was going to allow us to make a customizable product
that would interchange and evolve over the years
now we realized that the zipper was so important so we spent a lot of time in
communicating with various zipper manufacturers and with those
zipper manufacturers we we talked to some of the big ones some
of the medium ones some up-and-coming ones and everyone in between
and essentially what we started to really discuss was
hey can can you guarantee that your zipper will interchange
between production runs can the zipper be customizable
and interchangeable between links right between chains
and a lot of the suppliers were a little hesitant to guarantee that they would
say well we can't necessarily guarantee that
but it will work right but there was one supplier that
said yes we can guarantee that so we went with them
now when we ordered the batch we made sure that in the agreement it said they
could be interchangeable and this is the amount of quantity that
we're getting now when we received that batch
the first thing we noticed is that we didn't receive the amount of zippers
that we ordered we were able to tell that with a weight
base method which is going to be featured in a recent video on our
channel which i highly recommend you guys do
we were able to tell that they shorted us on a couple hundred yards worth of
zipper chain so we contacted them said hey look you
guys are you guys shorted us on this they said well we thought we did it
right but let's send you some more once we actually went to the
manufacturing process we found out that the zippers were not interchangeable
on a longer bigger batch production size they were interchangeable within a few
inches or a few feet but when you got into the yards or into
the meters or into like a bunch of different zippers all coming together
there was issues in the production run so we were able to
show that there was an issue and they were able to find out why that issue was
happening and since this company was on a come up
and it was eager to do business and they promised that it was customizable
they were able to find out that zippers cooled and healed at different
temperatures based on whether they made it in japan or whether they made it in
mexico it's little details like that that you
don't know unless you're doing business so for them it was an expensive lesson
because they had to refund our money because the whole part of the ordering
process was it needed to do that function which they
promised it could and it was written in the agreement so
before you guys finalize the agreements and submit your payments
make sure that you guys note down exactly what the product should do
and be very clear with the manufacturer that it needs to be able to accomplish
that and that will help you in either getting
refunds credits or having them make you a new batch to
meet the demand of what it is that you need but without
those terms in place you guys are essentially out of pocket they could say
hey we sold you zippers and you never mentioned in the agreement
that it needed to do a customizable feature or whatever it might be
so it's out of our hands right but when it comes to noting that down in a good
agreement you're able to say no it was clearly
written so the people that run the company will want to remedy the
situation in order to make everyone whole
now once you finalize the agreement the next thing is in actually submitting
your payments to them now when it comes to working with suppliers on alibaba
there's a couple of different payment terms that you can create in order to
make sure that you're somewhat being a little safe with how you're
dispersing the money the most common one is a 50 50 term
meaning that you place a 50 on the start of the production in the 50
once it's completed and they show you pictures and images that it's actually
done and it's boxed up ready to go to you
that will help protect you from any potential
scams or issues that may fall down the line because if you give them a hundred
percent of the money and then they don't produce the product
then you're out a hundred percent at least this way you're only out fifty
percent and you could start the process again and at least have another fifty 50
of a budget worst case scenario now if you're doing a lot of business if you're
ordering a couple thousand tens of thousands hundreds of thousand dollars
worth of product there's other payment terms you can work
out such as 33 33 33 which is 33 on the start of the
production 33 upon them sending you proof and validation that
things were created somebody was able to inspect it and said these are your goods
and then 33 of the final order do upon you actually receiving and inspecting
those goods this will help you make sure that you're
getting the product that you ordered and that's actually right
through and through now if you receive the shipment and something's wrong
then they have to either address it fix it but that's why you're always
withholding that last third of the payment
and then if you're ordering multiple times and you start building a
relationship with these suppliers always asking for net terms whether it's
net 30 or net 60 or net 90 on the final third or the final half of the payment
will always help you with cash flow allowing you to sell some product as
you're actually receiving it you could sell it and then pay the
remainder or the balance to them within those 30 60 or 90 days
suppliers are open to payment terms so always know that terms can be negotiated
and don't be afraid to ask if they're open to that this especially applies if
you're doing any type of deal outside of the platform
whether they want you to do a wire transfer or they want to circumvent the
alibaba platform fees and they want you to pay
directly to their bank this is one of the scenarios and where
you definitely want to negotiate terms and definitely protect your your your
investment which is not recommended that you go off the platform because there
are a lot of scams which leads us into the final lesson and
that is in how to avoid scams now if you're serious about your
business and you want to protect your investment in the products that you're
developing the very most important thing that you
need to do is actually research the person and the business
that you're actually talking to online now there's various ways to research
them the first is just asking them where is the factory located where
your office is located what is the company website
with that information you're able to go on google maps you're able to go on
their website and you're able to actually call the
office to see if somebody answers there that is aware of the situation in the
conversation that's happening between you and that person on alibaba
oftentimes there's a lot of scammers out there who are posing to be
part of the company that they're representing on alibaba
so what happens is they give you all the information they need they give you
photos of the products that that factory actually posted on their
website or something else and now they're communicating with you
and telling you that they're going to get you amazing prices
so the very first thing you need to do is you need to call the company and make
sure hey does this guy work for you is he an
actual rep of your business and if they say we have
no idea who that person is chances are you're getting scammed so in
order to avoid the most common one always make sure you're doing a legit
check on that manufacturer now if the manufacturer doesn't come up
online then that's also another red flag you're going to
need to investigate before you continue moving forward
and more importantly guys if it seems too good to be true
chances are it is if the prices are crazy different
if you quoted one guy quoted you 22 25 bucks and now this guy's saying he
could do it for five but you have to order a little bit more
chances are it's probably a scam or something to
really look into maybe they're going to cheap you on the
supplies maybe they're going to change your goods last minute
always know that there's people out there that are going to try to scam you
on alibaba and the best thing that you could do for
yourself is do the back end research to make sure that the company you're doing
business with is actually in business so there you
have it guys i hope that this information helps bring some clarity and
helps you navigate the ordering process through a platform like alibaba
sourcing for manufacturers is perhaps one of the most exciting parts of
actually building a brand it's the time where your idea finally
meets reality and you're able to see the fruit of your
efforts finally come to life it's also one of the most exciting
daunting and challenging parts of the process because it does
take a lot of communication back and forth design concepts
reiterations all this other stuff that you need to do to
actually bring it to where you want it to be
and for that reason it could be overwhelming and it could seem like
you're spinning your wheels because you're not able to get what you want
and for that reason we actually created from the ground up academy which is an a
to z program that helps you actually design
come up with an idea actually create a business
actually market manufacture and navigate the entire apparel industry
and we have it available on a monthly program as well as a yearly fee
so if you're interested in learning more about it i welcome you to download the
free resources and guides that we have right down below
which will help you get started in the process and seeing if it's a good fit
for you now for those of you guys who are new to
this channel i highly encourage that you just hit that subscribe button
and i invite you to look at the videos that are on our channel which will
continue helping you build your brand and business
from the ground up so i'll see you guys on the next one