In last weeks eletter, I talked about going back to basics, particularly when it comes to product sourcing. As I explained, product sourcing is the cornerstone of a successful ecommerce seller’s business, so this week I’d like to take the opportunity to outline three of my most essential product sourcing ‘must do’s’ to help you on your way.
The biggest fear most people have when product sourcing is, to put it bluntly, the fear of being ripped off. Of course, this is not an unsubstantiated fear. We’ve all read tales of unscrupulous suppliers, fake websites and dodgy wholesalers – and whilst many, many suppliers are absolutely genuine, it is easy to be taken in by a fraudster, so it’s important you know how to safeguard yourself against scams and cheap, inferior products.
So, here’s you first ‘must do’…
Choose unbranded products
It can be very tempting to try and source branded goods, but actually branded items offered by Chinese suppliers are usually the first sign of a scam. Factories that manufacture branded products aren’t even allowed to sell them on in most cases. Think about it – why would a brand owner be happy for just anyone to cheaply source and sell their goods at below market value? Of course, they wouldn’t authorise that.
Secondly, intellectual property laws (the ownership and exclusive rights to a product) will apply to branded goods. Lack of adherence to these laws can leave you with your goods destroyed by customs and considerably out of pocket. So, your first must do is to only consider unbranded products when sourcing.
Once you’ve researched your product your second ‘must do’ is to:
Verify the supplier
As an ecommerce retailer, it’s likely that you will import from China – the benefits being the huge variety of available goods, competitive pricing, the opportunity for private labelling and so on. This being the case, your first port of call is likely to be Alibaba – a massive resource which makes thousands of manufacturers accessible to you.
To address a common myth, Alibaba is actually not unsafe, nor is it ‘full of scammers’ and you will find that it becomes a vital part of your product sourcing journey – but this is only true if you use it properly.
Alibaba runs a verification service (in-house and independent) which ensures manufacturers who join the site are legally registered companies, so it’s straight-forward for you to always check out your chosen supplier’s verification status – in other words, check their profile to see that they are Gold suppliers who have passed an authentication and verification inspection.
They should also have had an onsite check completed by Alibaba staff and have been verified by a third-party agency, plus they should be an assessed supplier. This means that an impartial third party has verified the supplier. You should also check references. Any genuine supplier with a good reputation will be perfectly happy to offer contact details of current or previous clients.
Finally, once you are happy with your due diligence and supplier verification, your third ‘must do’ is to:
You must request samples of your chosen product. You cannot and must not ‘buy blind’. It’s vital that you get to handle the product before going ahead with an order so that not only can you check the quality of the product, but also gauge other aspects of the process – for example, supplier efficiency and communication skills. Make sure you ask questions, and check information.
It all helps with rapport and your business relationship. Manufacturers expect sample requests so don’t be afraid to ask. You will usually be charged a shipping fee or a unit price plus a shipping fee and this may be considerably higher than the usual unit price. It’s important you are not put off by this as it’s standard practice, simply to stop the general public purchasing one off’s from manufacturers. You’ll usually receive the charges as a credit against your first large order should you go ahead. Choose. Verify. Sample.
Those are your three essential ‘must do’s’ to safeguard you when product sourcing. Remember them and ensure you put them into practice as part of your product sourcing process – every time!