How to Find The Perfect Supplier for Your Products
by Philip Murphy, on December 10, 2018
Philip Murphy of Private Label Sk.in offers tips for finding the right supplier for your needs in this guest blog post.
With so many different niches, the opportunities to sell products online seem almost endless. From skin care to fashion, one of the most important factors of starting and maintaining a successful business is sourcing from the right supplier. Whether you’re looking to have develop your own private-label item or buy a product to white label, having the right partners in place can make or break your business.
Yet despite all the resources available, business owners still find themselves lost in the process of sourcing the right supplier. In this article, I’ll break down the steps you need to take to find the perfect manufacturer for your business.
Understand Your Obstacles
When it comes to sourcing the right manufacturer, most entrepreneurs encounter two of the same obstacles. The first is the process of establishing new relationships with suppliers. As a new or emerging brand, it's unlikely that you’ve established long-term, trusting relationships with varying manufacturers. This isn't to deter you from the process, but to ensure you appreciate the importance of understanding and communicating your needs with potential suppliers.
The second obstacle is balancing quality and price. When searching for manufacturers you’ll likely come across suppliers that offer high-quality services at even higher prices, or manufacturers with incredibly affordable prices and questionable quality. The truth is, when it comes down to choosing a supplier, there is no one-size-fits-all option. While you definitely shouldn’t go with the low-quality option, you also don’t want to diminish your profits with an overpriced supplier. The key is in finding the right balance of quality and price for your business.
The quality-price obstacle highlights the importance of due diligence. In order to find the right supplier, you’ll need to have a solid understanding of your market, supplier options, and business plan. You don't need to pin down every single detail, but you should have a good understanding of what you can afford and what your potential customers will expect.
Understand Your Potential Market
Before you sit down with a manufacturer, it's important that you understand your potential market. Beyond the basics of ensuring there is demand for the products you intend on selling, you also need to ensure that you can offer some type of market differential among your competitors. There are many ways you can set your brand apart: you can undercut your competitor’s price, offer better design/branding or offer a unique feature. Evaluating your competition is a great way to gauge the opportunity you have to break into that niche.
Market research also helps you narrow down your options, as most suppliers specialize in specific products/industries. Once you understand your market and your options, it becomes easier to establish exactly what it is you’re looking for.
Here are a few resources to get you started:
- Google Trends: Google Trends gives you a basic overview of the popularity of certain topics, keywords, and industries.
- Social Mention: Similar to Google Trends, Social Mention helps you gauge the popularity of certain topics and keywords across social media.
- U.S. Census Data Tools: Although only relevant for the U.S market, the U.S census offers a number of useful tools for gaining insight on various demographics and locations.
Understand Your Options
For many entrepreneurs unfamiliar with manufacturers, the learning curve can be steep. It’s important that you take the time to familiarize yourself with the industry. Educating yourself on the ins and outs of the manufacturing industry can help you when it is time to make an informed decision for your business. Before you’re able to start selling your products, you’ll need to make several essential decisions about your supplier and supplier operations. Taking the time to research your options gives you more control over the decision-making process and will ultimately help you make the wisest choice for your business.
Depending on your intended niche or business model, certain types of suppliers are more appropriate than others. There are a number of supplier options including factory manufacturers, private-label suppliers and wholesalers. To get the best outcome for your new business, you need to know which one is the best fit for you. Take the skin care niche, for example, the industry that I serve. While factory manufacturers may be a good option for brands looking to offer new formulations, private-label suppliers are more appropriate for those looking to offer products that are already high in demand. Understanding your supplier options will help you better navigate the world of product manufacturers.
Once you understand the type of brand you’re building and the best supplier options for your business model, it’s time to shop around. Typically, the first option you come across is almost never the right one. To find the perfect fit for your business, you need to evaluate suppliers based on the information you already have about your business needs. Determine the standards (price, quality, transparency and fulfillment capacity) you’ll need for your business to function properly. This will act as your reference for evaluating possible suppliers.
Another major factor you’ll have to consider when shopping around is whether you want to work with a domestic supplier or one located in another country. The low price often associated with suppliers outside the U.S is reason enough for many business owners to jump on board. These savings don’t come without a price, however. They often come at the cost of flexibility, time and quality. Not to mention the hazards of investing in a supplier or factory that you’ve had little to no actual contact with. When shopping around for a supplier, consider weighing the conveniences of a domestic supplier against the seemingly cheaper international options.
Finding the right supplier is vital to the success of your business. When you’re going through the evaluation process, don't forget to stay consistent with the standard you’ve established for your business. Keep in mind the price, quality, capacity and willingness of the manufacturer to foster a transparent relationship.
Remember to be diligent, request samples, schedule visits and truly take the time to find a supplier that is committed to providing quality products and service. The process of finding the right supplier becomes much less of a hassle when you understand the needs of your business and the options available to you.