It used to be that one of the biggest obstacles in starting a business was getting product to sell. Manufacturing technology used to be very rigid. There were huge fixed set up costs that required huge quantities of stock for this cost to be spread over. This meant that budding entrepreneurs, those big on ideas, ambition and motivation, but lacking huge amounts of money and an established market to sell thousands and thousands of units to really struggled.
The convergence of flexible manufacturing process, supported by growing demand for small minimum order quantity (MOQ) manufactures (thanks largely to the massive growth in online and niche business) has meant today’s entrepreneur have many more options for getting product to sell.
In this two part post, I’ll outline a few options that I know of to get your products made. There are different options depending on the type of business model Â you’re looking to adopt.Â So, without further ado, here’s part one…
Small Quantities of Custom Manufactured Product
These manufacturers generally have a standard base product which can be printed with custom logos and other small design tweaks. In my experience, these manufacturers require a few hundred MOQ. Generally speaking, the more changes you make to the base product affects the price, timing and in some instances the MOQ.
There are literally hundreds of manufacturers that fall into this category – most of them located in the world’s factory throughout China and South East Asia. The best way to find these manufacturers is throughÂ alibaba.com. Alibaba is basically a cross between a directory of manufacturers through China et al and eBay. Each manufacturer posts pictures of their products, indicative prices and contact details. However, like eBay, there are also credibility ratings whereby manufacturers can earn different rankings based on how long they’ve been around, customer feedback etc. I found my WASP Bag manufacturer through Alibaba and it’s been a great experience. I hear occasional stories of people being ripped off etc however I believe this is pretty rare – and like anything online, just be aware. If it feels dodgy, it probably is.
Another cool resource if you wanted to create and sell your own books is blurb.com. On Blurb, you can custom print your own physical books.Â Whether it’s a novel, a picture book or something else, Blurb can print, bind and send in a number of formats, cover materials etc. They have pretty small MOQs and discounts for larger orders. A cool site and concept, worth checking out.
Basically drop shipping is when a manufacturer and/or distributor has stock on hand and then despatch it to your customers as orders come in. This is the method commonly referred to in Tim Ferris’s Four Hour Work Week book. If you don’t know what this book is, head over to Book Depository right now and get yourself a copy.
Drop shippers are very hard to find in Australia – I haven’t found one yet. Local manufacturers just aren’t set up for the small ones and twos order quantity of new startups, and the Australian market I do think is too small for drop shipping to be a viable business option as the drop shipper.
The resource that I recommend you check out to is Worldwide Brands. Worldwide Brands is like the Alibaba of drop shipping, except, you pay aÂ fee to access a directory. Their site does have a few good ebooks on drop shipping which I recommend you read. I haven’t signed up to their service – it seems like it could be good but I wasn’t keen on paying the few hundred dollars to find out if it would be or not. It isn’t clear if they have options for Australia and when searching for them on Google, the term ‘Worldwide Brands scam’ is suggested… Hmmm… Would love to know if anyone has tried these guys out and what the experience was like. UPDATE – when I first published this post, WordPress suspended my account for breaching their terms of service – apparently the Worldwide Brands link triggered their automatic scanner… Suggest joining Worldwide Brands is considered with care.
The other thing I don’t know about drop shipping is the ability to customise product. Understanding the model, I can’t see how you’d be able to customise much, if at all. This is a bit of a drawback for me as ideally you want to launch a product into an established market and promote it on a key point of difference. And if you can’t customise, how can you be different?
What Have I Missed?
I’d love to know what resources have I missed here. I know there are new suppliers/websites etc popping up all the time, the above are just the one’s I’ve used or heard of. Don’t be shy, share your knowledge in the comments below.
So that’s it for part one. In part two, I will provide a few tips and resources for custom logo drop shipping (yes, I made this name up) and digital product creation. Part two will be out in the next week so keep an eye out for it.