How To Find GOOD Manufacturers Overseas

Today I’m going to help you find good suppliers when you’re sourcing overseas so we’re gonna go into two case studies based on my experience with suppliers in the past where I just didn’t have a great experience with them what I learned from them and what how it can help you but before I get into that I want to dive into some more practical tips that you can implement right now when you’re searching for suppliers so if you’re sourcing overseas and in particular in Asia I think the best place for you to source is on Alibaba comm you know it’s just easy to use it’s organized it’s just getting better and better every day and there’s so many suppliers on there so you know if I head over to Alibaba and I want to find a hairbrush that’s the product I want to source I type in hairbrush there are gonna be tens of thousands of different search results and it’s going to be actually impossible for me to go through every single one of them so you can filter things now the first thing you need to know is that even though there’s tens of thousands of search results it doesn’t mean that there are tens of thousands of suppliers sometimes one supplier who is sourcing who has one hairbrush will list several different listings for the same hairbrush because that increases their chance of you clicking on them but you can filter that out so you can actually click on

suppliers and it will show you one listing pursue then you’ll maybe have fewer search results now you might still have a lot so then the next thing you do is you click on gold supplier a gold supplier is someone who has paid Alibaba to be listed on there so it shows that they’re more serious about it

you know thing is it’s not really a high fee so most suppliers do have the gold supplier badge now if you still have a ton of search results the next thing I would recommend you do is you click on assess supplier so an assess supplier there’s actually much fewer

manufacturers who are assessed suppliers because it means that someone actually went to the manufacturing facility they went to the warehouse and they inspected things they saw that it’s legitimate they see you know everything that’s going on and so Alibaba has assessed them so there are fewer suppliers who do have that badge and when they do have it it’s a really good sign the next thing you guys should know is

that there is a difference between a manufacturer and a trading company so note the difference a manufacturer is the person the company who is producing the goods they are making them right there they have a warehouse they have a manufacturing facility where they are creating them from scratch the trading supplier is the one who is kind of like the middleman in between the

manufacturer and in between you and here they are and they will basically find products in China or wherever and they will list them on their website and then you will find them thinking they’re a supplier and then you’ll purchase from them and so oftentimes you’re going to be spending more money when you buy from a trading company versus when you actually buy from the manufacturer itself now how do you know if a supplier on Alibaba is actually a trading company or a manufacturer well one thing is it actually says on their listing so it will say if you click on the company it will say whether it’s trading trading company a manufacturer or both sometimes the air post sometimes the manufacturer is also a trading company the best thing you can have is going directly to the manufacturer themselves for the best rates and quality but you know sometimes you might end up buying from a trading company the next thing you want to do is you want to ask the supplier so the next steps is communication you really have to get in contact with the suppliers themselves so initiate contact ask some questions and here are some things that you really need to ask them to really evaluate legitimate they are and I’d say the first thing is asking them for certificates you have the maybe it’s not the first conversation you have but you do want to ask them for this so there are certificates that you’re allowed to ask them for you have the rights to see them some of them include a business license a bank account certificate a foreign trade registration certificate and iso9001 certificate which helps you understand that they have good quality management systems customs registration certificate so they are able to export test reports and in fact test reports are

important force and products so products like toys and electronics it’s very common for you to actually need to get a test report if you’re exporting into another country customs will actually ask you to have those test reports available and a Performa invoice which is going to make sure that you’re spending your the money that is going out of your account is going to their correct bank and company information so you’re a lot to ask for these

certificates if a supplier is hesitant to give you them or to show you them that’s a kind of a red flag for me you know most of the spars should have these certificates they’re pretty basic you’re not asking for anything too extreme and so if it’s supplier is not willing to let you see that it’s kind of a red flag for me the next thing I recommend you doing is you ask you let them know that at some point you are going to have a third party inspection agency inspect the products so you’re letting them know ahead of time you’re giving the Mauryan ahead of time that you know before I pay you the remainder of the money and before you ship the products to me I’m gonna have someone inspect the products to ensure quality and if you tell them this ahead of time most likely they’re going to be on their a-game when they’re manufacturing your products because they don’t want any issues with the third party inspection agency so they’re gonna give you good quality products but if they back away and they say no we don’t want you to have a third party

inspection agency we don’t want someone else in our facility that’s a red flag you know they should have be able to accommodate that request because that’s pretty standard and if they don’t want anyone else in their facility that might mean that some bad manufacturing

practices are going on okay the next thing you could do is you can tell them that you are going to draft up a

contract between you and the supplier in that contract there is going to be a number of things they’re gonna get as specific as possible

but one thing that you really want to mention is that there’s going to be a time frame in the contract so if they told you that it takes 45 days to manufacture your products that’s gonna be in that contract it’s gonna say 45 days plus 7 days you’re going to give them 7 days extra in case they have delays but after 7 days if the products aren’t done they’re gonna start paying every single day so you have to agree upon a certain amount you know maybe a percentage of the total order and it gets deducted from the balance that you owe them and so when they know that every single day they’re losing money they’re more likely to hurry up and finish producing your products because if you don’t have something like that and they quoted you 45 days and 55 days later the products are still not done they’re gonna take their time they have no reason to really rush things

especially if you guys don’t have a great relationship or they see that they’re not going to continue the relationship with you then they might take their time something else you want to mention ahead of time is you want to make sure that you let them know that your initial deposit for your inventory is going to be 30 percent typically 30 percent is paid a habit I’m 70 percent after the goods are done that’s very standard and sometimes manufacturers will say no we don’t allow that we want fifty percent ahead of time 50 percent later or sometimes even they’ll say 70 percent ahead of time and 30 percent later which is just not reasonable it doesn’t make sense so you let them know ahead of time that’s your standard and you’re not going to change that and just be clear about that and if a

manufacturer doesn’t like that then you move on to the next one the last thing that you want to make sure that you track is communication communication is everything as you’ll see in the case studies I’m about to share with you when you have lack of communication with your supplier things go on and on and on and get delayed especially if they’re overseas and you’re on a totally

opposite timezone you know you might send them one email and they might get back to you a day later with another email and then you get back to the MU day later with another email it takes so long so you want to have fast

communication so put out a spreadsheet create a spreadsheet track all your suppliers on the spreadsheet and monitor how fast they are to get back to you because it’s really important they respect your time and you respect theirs okay now having shared all those tips with you I want to get into some real case studies to manufacturers that I have worked with in the past and I’ve had a terrible experience of them so the first one was a manufacturer for

creating custom packaging and printing staff

and so they basically made you know cards insert cards they made tissue paper they made bags poly bags and things like that and so the first problem with them was that after we had you know talked so much you know I never clarified with them you know ahead of time that I’m paying 30% deposit and 70% later that’s why it’s one of my tips but then they told me oh you know you have to pay 70% deposit and 30% later I was like whoa

this never happens you know this is not standard practice who pays 70 percent ahead of time and so I told them no that’s not going to happen and so they were kind of arguing with me about that saying well that’s our new rule and that’s how it is and then I said okay I’ll pay 50% ahead of time I kind of negotiated with them and then we finally agree to that but that was the first kind of red flag for me it was very strange you know why are you asking me this and it’s something I should have asked them very early on in the

communication the next thread flag was just that there was such unprofessional communication I think that you know the thing is when you’re sourcing overseas and there is a language barrier you cannot expect perfect English from someone whose native language is not English that’s unreasonable but there are ways of communicating that’s

professional and that’s not especially you know people in Asia know that they have very high standards of

professionalism they’ve got great manners and so when I noticed that this supplier was communicating with me very unprofessionally

I should have taken that as a red flag because it was just strange you know it’s just a weird the communication it was like they were talking to me like I was their friend and they could

negotiate with me and that could

convince me to do certain things and say you know it just wasn’t right so you know trust your gut when it comes to that I think often times we just brush it off we say oh it’s just their style of communicating but no I think there are standards that it comes to when it comes to a business relationship and you guys should always keep that in mind the next red flake was when they asked me to pay on PayPal instead of using trade assurance so I had an order that was about five thousand dollars with them and they were

saying like they don’t want to use trade assurance because it’s gonna cost them more money and they prefer me using PayPal which is strange because usually the suppliers actually want you to use wire transfers instead of PayPal because PayPal has higher fees but for some reason they were avoiding the trade assurance and you know for me that was a little bit uncomfortable I like using Alibaba trade assurance I like PayPal fine but it’s better for lower you know lower cost orders you know things are under a thousand dollars under two thousand dollars but it’s a five

thousand dollar order so I would have preferred to send a wire transfer so they were kind of negotiating with me about that which I felt a little bit uncomfortable about the next issue we had is that when she printed the initial order the quality for example I was cutting these drawstring bags made so these bags for you know putting in my products inside and they printed it and the the brighting on the bags was starting to peel off I could see that from the picture and so she told me you know she she was upfront about it she said yes you know there’s a quality issue here but she asked me to accept it so she didn’t want to fix the problem she asked me to accept it the way well as I said no it has to be a hundred percent perfect quality if I’m

purchasing something I want good quality I don’t want my customers to receive something that’s going to break down in a couple days and so I ended up having to pay more for them to fix the quality which was strange because I was saying you know why am i paying more for the exact same product if you guys are having an issue on your end with your printing facility and something’s wrong you guys need to fix that but I

shouldn’t have to be paying more for the same product I ordered in the first place and then the final issue which was the most annoying issue to me was the printed tissue paper for me like gift wrap paper that you would you know put in press ins and this tissue paper had specific you know I designed it with my own words I had like inspiring words on it and I asked them to print it and then they printed it but they printed it wrong

they printed all the units with my logo instead of using the actual text that I had giving them the design I had given them and so they printed them all and then she told me about it and she’s like I’m so sorry we printed the wrong design please accept it anyways and I said no this is not right you know if I’m giving you a design this is what I want printed this is the product I ordered you need to redo it you need to recreate it and I’m not paying for that because it’s a mistake on your part but then she started to basically make me feel bad and she’s saying please accepted because if you don’t then this person is gonna get fired the one who printed it and I can’t share screenshots with you because she actually deleted the conversation on skype I was looking back on skype and she deleted all the conversation she had for weeks she was telling me accept it accept it please this person’s gonna get fired and here again this is such an unprofessional way to communicate with someone that you’re doing business with and so at that point I was just so fed up I had such a headache with this supplier and I was just like you know what I’m just gonna pay extra for a new one and so I learned my lesson at this point that this was not the right supplier for me I’m finding someone else to create future orders with even though the supplier is cheaper the supplier you know in the end the products they printed were up to my standard but all the hassle I went through and all the communication problems it just wasn’t worth it okay so now we’re gonna get into another supplier story this

supplier you know it wasn’t a good risk experience at all for me but a lot of it was my fault so I think it’s important for me to admit to that and to share with you what I did wrong okay so with this supplier I first established communication with them of August what was the August 27th 2017 and my products didn’t get shipped until May 18th 2018 it took them nine months to finish my order so that is just not acceptable that’s not okay

but it was on both of our parts you know partly because of them partly because of me partly because of difficulties of the bank but that was just horrible so this is a supplier that I use to create my luck’s curbs underwear line and so you know I got my samples initially my customers were excited I was posting photos on social media and nine months later I still don’t have the product available

for sale and people are like what is taking so long and it’s just a bad experience so what were the warning signs with the supplier well first of all there were nine you know the

supplier was a supplier that had ten years experience a supplier that was gold you know had the gold badge was an assessed supplier the person the initial contact with the supplier was very fast on on Alibaba itself they were very fast to communicate with me so I really didn’t see any issues with them and it seemed pretty fine it wasn’t until later on that things got bad so there really weren’t many warning signs for me and nothing I can really share with you to help you avoid this situation so August 28th on Alibaba the supplier the one I was communicating with me with she asked me to convert to move our conversation to Skype or whatsapp now this is common when you’re talking to suppliers on Alibaba eventually when they know they’re gonna work with you they’re gonna want to communicate on skype or what’s up cuz it is faster you know it’s faster than going back and forth via email it’s faster than Alibaba is sometimes and so it’s good for you but it’s also can be the reason they could be asking you to do this is because on Alibaba they have a response rate and in order for them to maintain their high response rate they need to respond to you as soon as possible on Alibaba but if they don’t want to continue to respond to you as soon as possible they might now ask to move the conversation off of alibaba’s they might now converse with you on skype where the response rate is not calculated so then you might start to notice that it takes longer for them to respond to you so the production time was quoted for one month so that is I think in my opinion it’s okay it’s not ideal I would say you know it depends on the nature of the product but around you know twenty days is a good amount of time but one month was fine so it’s okay so my mistake here was with the original sample with the supplier instead of ordering a sample which they already had in stock for example if I’m sourcing underwear this is what the case was if I’m sourcing underwear the supplier already has a similar style underwear I could just

request that sample to be sent to me because all I want to know at this point is I want to feel the quality of the product I want to feel the materials I want to see the color options I want to see how they do what they’re stitching like are they professional with the seamstress I don’t have the word for that and that was kind of the main goal with a sample but instead what I did is I asked them for a custom sample so custom sample they quoted me 20 days to make so for me to wait 20 days just to receive the sample was too long if I had just asked them for a basic sample whatever they had in the warehouse sent it to me today it could have been delivered to my house in 4 days with air shipping so that was a mistake I made my initial sample should just be whatever they have just to see if they’re good and then if I find that the sample quality was good then I can proceed with them with a second sample that is customised when I received the sample I noticed that the color of the band was not accurate it’s not what I wanted and also the stitching was not well done I didn’t like the way they stitched you did too just looked unprofessional and so I expressed those things to the supplier but basically they didn’t say that they could fix that so you know at that point if that was a high of high value to me and it really was I should have maybe proceeded with another supplier who could have better quality stitching and the colors that I wanted okay the reason it took so long was because after I received the samples I told the supplier all the things I wanted them to change I wanted them to make it bigger here I wanted them to change the color of this and this and this and this and then I expected the supplier to start working on that and produce another sample for me and then 28 30 days later I’m messaging the you know constantly and they’re saying oh I emailed you and you never responded and it was just like this lack of

communication on both parts and ended up wasting 30 days of time they never even started with all the edits that I had given them so we lost 30 days right there and then we had issues with the banks so I sent them my deposit they never received it it took like three months for them to receive it there was some

she’s the wire transfer so that just took a really long time and now I’m trying to communicate with the supplier you know placing another order which I don’t actually intend to do with them but I just wanted to see if they would actually respond to me and it’s been over a month and they haven’t responded so if I’m in a situation now where I need to place a second order with the supplier I’m out of luck I’m gonna have to find someone really quick to

replenish my inventory because the supplier is no longer responsive so that’s just kind of like not great and it’s mistakes on both parties but you live and you learn so that’s the story so I think it’s just like really being aware things really be conscious of your communication of what’s going on and definitely listen to your gut so hopefully these tips help you when you’re picking your supplier if they did please thumbs up this video and share it with someone who could benefit from this and I will see you guys in the next lux bits video bye

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