PLH 114 | Product Sourcing In Asia

 

Broadening your lines and reaching out to source products beyond Amazon can sometimes be daunting for many entrepreneurs out there. After all, it is a whole new territory that needs to be tread carefully. If this new territory for you is in Asia, then you are going to be learning a lot from this episode. Rhod Needham, a product sourcing expert and the Co-Founder of Market Source Asia, pours in his knowledge about sourcing for products in this region, giving some great Asian sourcing tips. They specialize in launching products and collections for both global retailers and start-ups, and Rhod takes us into the systems they have in place and walks us through the development process – from getting ideas into products, down to QC and even selling them. Don’t miss out on this episode as Rhod delivers some great advice about designing, testing products, and broadening your reach.

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I have an interesting guest for you. I have an international guest. I have Rhod Needham from Market Source Asia and he is a Product Sourcing Expert and a Founder of Market Source Asia based in Hong Kong. He specializes in launching products and collections or both global retailers and startups around the world, not just here in the US. Rhod has carried out a huge number of extremely diverse portfolio products and projects, categories ranging from travel retail to international fashion brands to homeware, TV infomercials, Kickstarters, global sporting associations and eco-friendly products. He’s had a career in finance and moved to Hong Kong to work with investment banking. He was running a small toy company where he was sourcing toys from China and selling them on Amazon UK just for fun, and that’s where the sourcing journey began. Rhod, I’m so glad you’re here. I’m so glad we met at the Sourcing Conference. We sat next to each other and you didn’t realize I was a speaker. The next thing we know, we’re starting a conversation and I had an enjoyable time getting to know you.

It’s great to be here. Thanks, Tracy. We did meet at the Global Sourcing Conference. I remember we actually sat together at lunch. We’re chatting about some of old things, sourcing and retail and developing products and stuff. We were talking for so long that we didn’t even get back to the next speaker.

That’s my favorite part about conferences is to getting to meet someone who you wouldn’t meet otherwise. How long has your company been in place? How long have you been sourcing?

I’ve had Market Source for a few years. The social journey began before then, but it was an accelerated journey with Market Source because of the way the things transgressed with the number of clients we’re able to obtain quickly. We launched a heap of different products and went through a whole different group of categories quickly. We got a very steep learning curve and we’re able to refine our sourcing strategy and become specialists quickly because we had no choice. It was an in-depth start.

I think that’s a mistake that a lot of people make. They get their feet wet within one category or one type of product and they think, “I’m good.” They don’t realize that as you start to expand into other categories there’s not an economy of scale. It’s like starting all over again. You’ve got a whole new source and set of factories, a whole new set of quality control factors that you may have to learn. It’s complicated. It’s not actually simpler.

It’s one of those things where you almost have to start again with a new product and learn about the ins and outs and specification. Certifications are needed. What particular regions, what testing requirements are needed? The sourcing part is one part of being able to find and validate the right factories in the particular network. The other thing is getting know the product well so that you’re able to foresee any issues going forward. You can’t just pick a product and flick it to a factory and hope it’s going to sell or hope to not have many bumps in the road. Who knows, you hit 100 million bumps in the road and you’re able to foresee them before. Set up certain things in place so that you can mitigate your risks and be able to see the difference and categories all at the same time.

That’s why I’m a big fan of working with companies like yours because you have experiences and what happens over in other categories, you do learn and plan in or you have materials that cross. You start to find out all these materials or issues if we don’t quality control them. You have a lot deeper knowledge into how you can be more successful and reducing those pitfalls that happen. That’s why I’m a big fan of that broad experience but also narrow niche experience too. You’ve got a little bit of both.

A lot of it is transferable. You use the same model and the same techniques and everything to apply across the different categories. You do use a consistent way on best practices, and then you dive into the actual products specs. You can definitely standardize certain things so you’re able to spread your expertise, but also there is one other thing where once you see something once, you can then apply it and you recognize it. You see something come up in a certain product and you’ve seen that before on this product and you’re going to catch certain issues early.

I had a call with one of our audience. He came in for a strategy call and he was saying, “I’m avoiding batteries because of you.” I was like, “I don’t want you to avoid them. I just want you to be smarter about them.” Let’s clarify how that works. I didn’t mean to scare everybody about batteries, but he doesn’t need rechargeables which there’s a lot more risk there. That comes from massive failure and experience and knowing that there’s a big problem here. I’ve seen that problem. This is going to be an issue or a cost factor, that’s the other thing. When we look at something, because we have such broad experience, you’d get to know this is going to be a cost creep. It’s going to creep over time because the material costs are going up or because things are happening. That’s great knowing that when we seek out an expert like you, we get that experience and that broad knowledge of what’s going on in the marketplace as well. You’re right there, so you know what’s going on and we’re having a lot of volatility issues both in labor costs and in material costs as well, of course over here terra costs. Having knowledge of what’s happening in the markets are useful as well. Do you watch that for your clients?

You can recognize certain themes and factories and they’ll say they want to work a certain way or they’ll try and cut costs. They’re trying to cut out steps. For example, if there’s something that the sample is not quite right, they’ll say, “We’ll fix that for mass production.” You then have to wait and it all goes wrong if you do wait to see if it’s right at mass production.

Never do that. We highlight two sample problems here. One is where it’s not actually right in the final version. There are very few exceptions. There’s like, “We’re going to change the stitch color.” As long as they give us a stitch sample, we’re good with that. There are very few things that I’ll accept after the fact. There are changes that you need to make for that final sample, and then there’s what we call the golden sample, which is the sample because it was handmade. Especially in upholstery, it’s made by some of their best artisans. It won’t look like that no matter how hard you try because that person is so experienced. I’m a big fan of being there when it first comes off, the first ones off the line and looking at it to make sure all that’s right. You can cut a lot of time out of the process if you do that.

A lot of people design on their end without ever going to the consumer side of it. Click To Tweet

You can’t substitute being at the factory when it starts that. You’d be surprised. Some people don’t try and get through without a golden sample. To get a golden sample signed off and approved, that’s one thing, but to go and actually be in the factory when they’re making it is another thing. You can catch them straight away or you can catch certain ways that they set up their production in order to meet that golden sample and you’d be surprised almost every time you make heaps of changes, wherein the factory is maneuvering different production lines around and different machines.

It is finding better ways to process it through it and make it right. It’s my favorite time because there are lots of exciting things that you can do at that time that will get set in place that will mean better quality later so you can have a big effect on your overall quality and cost for long-term.

The quality upfront is a huge cost if you look at the whole life cycle. To not invest a little bit of money into the initial QC is a huge failure. Nine times out of ten, the end product won’t be right. You have to send ten products back or you have to redo products and you use time. You have huge sales implications on the other end because you missed.

It’s a timing issue.

We’ve had times before where we’re doing a summer bag collection and there was this huge QC problem. The whole thing had to be changed and the summer bag collection was so late that it arrived at the winter collection.

It’s the wrong materials. You’re going to have to find a different part of the world to sell that in.

Flowers, they’re working in snowy Europe.

We may have to send that one down under. You have to be efficient because you have so many clients and you have so many factories that you’re working with. You have systems you put in place and I think that’s a lot of what our startup entrepreneurs don’t have. The ones following this show, what are some of the systems that you’ve felt worked for you? Maybe some of the things like contracts and sign off samples. You’re processing for all of those, what works for you?

I’d recommend honestly to create a working flowchart and implement every single decision that’s made throughout the whole life cycle of end-to-end products. I created this and sent it to my clients. You create the first stage to be able to validate the factory and different decision-making processes that go into validating the factory. Once you get that, then you’re down into the sample. All of the sample validation implications you have to adapt before you’ve even decided whether you’re going to brand it, the packaging. If you have everything in place as you go, that goes through the whole thing from sampling and then to get sign off, to get the golden sample as you complete and thought about mass production and then you’d have to book in your QC, which needs to be at the start. Mostly we’ll make a mistake that you did QC at the end.

QC starts at the start. You’re right there.

Getting everything in place at the start, to get contracts in place and you have the specifications and the information down in black and white for the factory, you leave absolutely nothing to the assumption of the factory. You have everything specked out in a product info sheet and within the PO, and you have a contract that securely is tightened so that anything is outside of that black and white writing. You have grounds to move on it. Having the contracts in place at the start is very important. I’m sure you probably have good contacts that we use a Hong Kong lawyer to do all our stuff. It’s actually forcible in China. A lot of people think it’s China. If you use a certain legal team, you can have something in place. The key thing is to have something in black and white so that the factories are then accountable to exactly every single specification.

PLH 114 | Product Sourcing In Asia

Product Sourcing In Asia: To not invest a little bit of money into the initial QC is a huge failure. Nine times out of ten, the end product won’t be right.

 

What I’ve found is that there’s a stage what I would call contracts. It’s more like if you treat it like a memorandum of understanding like something we talk about here in the US. We’re not looking at making a legal hassle out of it, we’re just making sure that we’re clear on our communications with our factories and expectations on who’s doing what and what it should be. I call it critical factors or product info sheet. There’s a bunch of different ones, and I have one that’s for the manufacturing side of it, one that’s for the quality side of it and one that’s specifically for the marketing side of it. In other words, marketing information that needs to get put on the box or other things. It’s this logo that’s being used. Some people would call that a style guide as well, but I don’t want to put a guide in because if we put a guide in there, it’s open to interpretation. We have those three pieces and they happen at three different times in the design and development process so that way we are keeping and adding so our memorandum of understanding can fluctuate as we learn more about the process.

It’s probably less about the actual legality of a contract. It is about setting the tone and setting the standards for the factory to keep. Also, if you’re working at a startup or it’s your first time working with a particular factory, then it demonstrates that you are serious and it’s an official agreement that you are keeping them accountable to. Whether actual legal teams that end up having to get involved is usually very unlikely and it doesn’t happen. It’s having that backup is what starts the relationship on the right foot. It’s obviously about building a relationship with the factory. On top of that, you don’t want to be like, “We’re going to sue you. We’re waiving this contract around to keep you to this.” You want to have that so that they know exactly what’s expected of them. You build a good relationship with that factory so that you’re then trying to help each other try and create many win-win situations as possible. Noticeably things always do go wrong in the factory. You need to be able to have something where you’re working towards where you can both benefit rather than you have some brittle relationship where the moment they put a foot wrong, then you cart them with this giant contract.

Do you guys physically sign your samples and things?

Yes.

We do too and that’s a good practice for everyone out there. When we receive it here, we put a label on it when it was received and some information about it. It’s because you get through multiple samples and it gets hard sometimes to remember which one came first. You have all these samples and they look similar on your desk and you’re like, “Which one came from which batch?” You start making changes to the wrong one. We always put labels on them that we have that. When we get to our final sample, we’re usually at the factory. We will sign two of them. One we keep them and one they keep. That’s how we do it. We have two side-by-side. We make sure they’re very similar. The only time we’ll do more than that is if we have a color range. Sometimes there are wood finishes. You’re allowing a range of color. We’ll say here are the lower limit and the upper limit. We’ll assign multiples in that case.

It seems simple but it is very important to stay very organized with the samples and you have lots of different specifications and which ones are getting improved. That’s just on our side. Once we get to the actual factory, we have the golden preproduction sample that’s signed off for the date and takes photos as well rather than just stick a label on it.

Take photos, all of that is important because sometimes it gets lost. You do want to have that too. I love that. That’s a good plan.

We were doing a production of a product and we signed off the golden sample, a signature. Then a few weeks later doing mass production, we went into the factory and the golden sample that we’re signed off is just in the corner of a room. The box hadn’t even been opened again. A couple of years ago we were like, “You need to make sure that the golden sample has been used in the production and your QC teams are very familiar with it.”

Sometimes with my bigger clients, they have QC and QA team. Quality assurance, not just quality control. The QA teams usually maintain the control of those samples, whether it’s in a factory or not. The factory gives big QC teams a room within their office space. The samples are contained in that room and they get pulled out the minute there’s an issue or the minute there’s a question about whether or not something looks exactly like it’s supposed to.

QC teams, obviously it’s important if you use that passive one or you use an in-house one. There’s no substitute for being in there as well. We use QC teams. We have a partner with this QC third party for our company and they’re there all the time and they’re very good at checking the physical products and specifications. Particularly when you’re doing, like us, we have quite a diverse range of products. I have one actual QC expert on jewelry to make up too.

You can’t be all of these things.

Design with the end in mind. Click To Tweet

To have a QC team that is large enough, they have to have specialists in certain categories to check the physical products and the testing is very important. For me to be there at the start to know the whole concept of the production and how it’s going to work, there’s no substitute for that. The QC team that technically get on the products, they will advise as much on the layout of the whole production and prevent things from going wrong. We will always have us there as well as the QC specialists.

I want to talk about the development process for you. People who are expanding out of Amazon private label and into doing more products and broadening their lines. They’re very daunted by the idea of, “I can’t just quickly buy this from Alibaba or I can just quickly buy this and move on it.” There’s a development process and it does take time. How do you combat that? How do you work with that? Are you set in place understanding that this is what it’s going to take to make it right?

We’re a collaborative company. Depending on the complexity of the products, we’ll work with engineers that will be able to map a full timeline of what is going to take to get this product created through that stage.

You’re giving them a sense of that to begin with?

Yes, we give them a huge sense because a lot of times you have to be realistic and say that for a very technical product, it’s going to cost you $50,000 to make this and it’s not going to be developed six months to a year. Can you map out every single stage of the process month by month of what it’s going to take to get there? They can forecast and develop that into the whole business plan. In terms of the factories as well, the key is to work with the factories that are producing that product of that nature. We’ve had clients in the past that have decided they didn’t want to dive straight into a factory that their products were not related and use the factory designer, which is a man in a garage.

I’ve seen it before. I know what you’re talking about.

They make up some botch sample based on what the client’s grand idea is of this product. You end up wasting far more time in the long run because you’ll get to the initial prototype faster because they will create something. That initial prototype has in no way have any capability of becoming the real product because it doesn’t have that whole process in place. They’ve just ODM some other products and then modified it slightly.

That’s usually the case. It’s hard to get to original product ideas. It’s hard to get original design. It’s hard to get them to do a style that’s saleable as well. Style is something that you must guide from the side of whatever country it’s going to be sold in. I don’t usually take projects over in Europe because I’m not a European style expert. If you want to take out a European product and bring it to the US, then you call me and I’ll help you with that, but it doesn’t translate to depend on the design source like that to guide you on those many different things.

You need people to be able to give you that insight. Some of our designers worked in the human innovation team and they’d work on a huge cascade of different products. They worked with BMW and Ford and all that thing where you’d be absolutely shocked to understand the amount of input that goes into the creating of minimalistic products. For example, for something to look minimalist and it looks simply like an Apple iPhone is 100 times more thought process and systems are going to place in making a product look like there’s nothing going into it. Every single aspect needs to be thought about from the color to the design where you wouldn’t have thought that if you are an entrepreneur or a startup and you have just a vision for a product. You need that insight to be subconsciously this is why they buy not knowing why they’re buying it. That needs to go into the design process. It depends on the product. We work with technical ones where we use engineers to go into detail of mechanics. For example, we do some backpacks.

This happened in a call. I won’t reveal it because it’s a private call from one of my audience. What they were saying is this is a common thing I hear, “I want to make sure that it’s smaller than Amazon’s size constraint.” I was like, “That’s a good thing because you don’t want to tip over and end up in their oversize category,” because you screwed up and made it half-an-inch too big or worst a millimeter or two. I’ve seen that happen too. You don’t want to make that mistake, but that’s not the core criteria because their product has to fit on to something else. That’s something else and surveying the market on the size of that is actually the critical factor. He hadn’t thought of that before and that’s exactly the kind of thing that a good designer has an awareness of. This has to fit with this or consumers won’t buy it or they’ll return it because it didn’t fit at the end of the day. It’s not something that mattered to you because you are making something in isolation.

You have to think about the whole end scale. Even on a more technical level, you have to look at what testing and certifications are needed for that particular region. We’ve had times where our clients haven’t actually looked into the details of what certifications are needed for that region. We’re talking about Russia at the time.

PLH 114 | Product Sourcing In Asia

Product Sourcing In Asia: Every single aspect of your product needs to be thought about where you wouldn’t have thought if you are an entrepreneur or a startup.

 

Is this a story about how you might have ended up on Russia TV? I read that in your bio. If this is that story, I’m anxious to get to it because that was my next question.

With Market Source, we’ve got a contract with a big retailer in Europe towards the beginning of the company. This company has eight different brands, 300 retail stores, a million hits on its website a day. The other thing they have is a QVC-type home shopping channel. We were launching a collection for them. It was a jewelry collection. We’ve done the full design and developed the line for them. They were launching it on their TV shopping channel. They thought it would be impactful to have that designer come to Moscow and come onto the live TV show and present their collection. That’s what I did. I flew out to Moscow, but the interesting thing about that one was the brands. It was a women’s fashion line. In Russia, fashion is not a thing. There were these glasses and big gold pieces. They were these big sturdy necklaces and big bracelets. For someone in the UK or the US, it wasn’t exactly fashionable. The other thing was they wanted it to be sturdy, so they wanted it to withhold these drop tests. One of the things they tested during the production was they wanted to do a two-meter drop test.

That’s such an obscure thing that you wouldn’t know if you weren’t working with them time and time again.

You also have to do pretty well to have a piece of jewelry to meet the drop test. One of the things they wanted to do was have this shown on the actual TV show. In the development of the line, we had done this drop test and of course, dropping a piece of jewelry from two meters on a hard-wooden board, it broke. We had to do some development on this product for this drop test. It was touch and go because it always fails and we had the factory come out. They said they changed the glue, there’s this 24-hour glue they put in, which obviously we didn’t believe. We had to try and have them put them in these prongs to keep this pearl necklace. We get to Russia and during this TV show they bring me out and they say they’re bringing the designer all the way from London. London had more of a sales impact than Hong Kong. I came all the way from London to design this and launch this collection for them. They gave me a big intro and I came out like I was on Jonathan Ross. They have these models and I had to present each model with the pieces and tell them how beautiful they looked.

Then comes the dreaded drop test. On live TV they say, “One of the best things about this jewelry is that it’s sturdy and it was designed in a certain way that can withhold any impact.” They say, “Go ahead and drop it.” They gave me this pearl necklace and they asked me to drop it a meter onto the wooden thing. The time just stops and your heart comes out. I dropped it and I had visions of it shattering all over the table on live TV. After we give them this huge intro that it was uniquely designed that it could do this. The pearl pieces drop and flood onto the table. I looked down and obviously nothing broke and it was absolutely fine. They were clapping and then they were so impressed that they asked me to do it again. I was like, “You can’t be serious.” I have to do it again and I was even more nervous the second time but it was fine. I was on the show for an hour talking about what goes into jewelry design for the Russian market. I was talking about the red color reflects the regal nature of the royal family in the UK and that is a big thing for them. That was one of my main claims to fame in Russia.

You learn so much in that process though of how you have to design. That’s the reality. There are a lot of us who design just on that end. You never go through that presentation part. You never go to that consumer side of it. There’s a silo there. That’s not been my personal career. My personal career has always been to also make the presentations to the retail buyers and possibly even do the test market research with consumers. Having a broader view of it has helped me and it sounds like it helped you because now you start to understand this has to do with how they’re going to market it. It seems silly on our end to be designing these odd criteria, but it has to do with what they know is going to make it marketable.

Design with the end in mind. Everything that you go in at the start, you have to have a clear vision of the whole process is going to look like and what’s going to be a sellability of the product. Through the years, we’re able to advise the clients on this. Whereas at the start, it was more a case of they will give us a product and we would make that product exactly how they wanted it, but we wouldn’t ask questions further when we first started it.

That’s a risk of working with factories because they will do what you asked them to do, thinking that you are the expert. If you aren’t, you’re taking a lot of that risk and burden then.

If you give something to the factory, they’ll do it exactly how you do it. You have to think about the end process with the client and what’s the sellability of it. Design it in a certain way and then translate it into certain communications in the factories so they can create it exactly how you want and not leave anything to the assumption of the factory themselves.

Something else that I think is a great benefit of working with a company like yours, with systems in place and team in place. I see this happen with my entrepreneurial clients where they lose somebody, like an assistant that was on their team or someone who was handling marketing or communications. They lose all touch with where this information lies. They come back to me like, “You must have this.” I’m like, “You’re lucky that I do. I save everything.” You might not get so lucky if you were working directly with a factory and those people leave and you’re in trouble. You don’t know their source. You don’t know all the information. You don’t have the relationship. Working with a company that does is critically important.

It’s having everything stored in black and white. A lot of the pitfalls within the communication is everything goes on an email. What you end up having is you have these long email chains of back and forth of amendments to the products and then confirming certain parts of the product, asking to change another part of it. You end up having these long chains that get lost and then you’re expecting the factory to decipher this whole thing and what the final product should look like. It’s almost unfair on that. You need to have these product sheets to map out in black and white exactly the specifications to the absolute letter. For example, the bag, we have every single size specification, weight and fitness material all in the sheets. When we make the changes, we obviously will email and we’ll talk by communication. Once that’s changed, we’ll then change the golden sheets, and you have something at the end when they create it and you can compare it to it. You can vet again, so this is correct. This is what we signed up for. You can’t expect them to say, “We’ll make that change for mass production,” and when they don’t, you say, “I’ve got an email here that you’re saying that you’ve changed it.” It doesn’t work like that.

There is not a better time to get started on your own entrepreneurial endeavors, particularly with eCommerce, than now. Click To Tweet

Be sure to sign and date all of those changes. You are thinking about change orders. That’s how we always talk about it. There are a lot of people who do this when you do house construction. When you have a contractor, you did change orders. It’s the same idea. We always assign and date every change order, or initial and date just so you know who did it.

Dates are very important because you have to keep everyone accountable throughout it. When you get to the end of it, you can then see the whole life cycle. Then if there are delays, you can see where it went wrong and then you can make amendments.

You’ve talked a lot about hazards, about some of these pitfalls and other things, but is there anything that stands out as an interesting story? Things where you’re like, “I wish we knew more. It was on us. It was on our client but I wish we did this different.”

Throughout the years you come across a ton. One thing I would say is to be super diligent. One is with testing. When you test the products for reach or whatever it may be, you have to do that test yourself and be sure what you’re testing. For example, if you leave the factory to send you the test reports, you don’t know what they actually tested. We had an example where we did a large order, about 100,000 pieces of products where we obviously went through our model and everything. The checklist of what is needed before the production started with the testings and certifications on that product for that market was going to Poland. We did a little reach test and they sent us that and we signed off when we had all the tests necessary.

We then shipped the products to Poland. In Poland, they do another test and it failed the test that passed when we did it. We’re wondering what the discrepancy was. What had happened is they had failed a test that comes out of the mass production from the shipment. The product that passed in Hong Kong from us, we weren’t sure that was actually from the mass production lot or some samples. What happens is the factory that sends off the sample to be tested that had all of the material that was high in lead, for example, that failed the test. They send up the sample that passed and they had all the credentials and certifications. When they test the one on mass production, that fails. What they’ve done is they used some products in the mass production with a slightly less expensive material that then failed the test. They have that and we shipped 100,000 products from Poland back to China.

I’m actually a fan also of if you can, and it depends on your time cycle, but if you can ship a product to the place and then have it tested there as well. We do that frequently for our mass market clients. When we do Costco and Walmart and Target, because you know they’re going to pick it off the shelf. They will, they’re allowed to. They’re going to do it. If they don’t do it, it’s cutthroat in the US, your competitor will. The one who didn’t get that spot, who lost, their product didn’t make it on the shelf and yours did. They will pick yours up and they will whine about it and they’ll say it’s bad and they’re just looking for something to go wrong in it.

Sometimes we ship a product across the sea ahead of time because we want to see if the packaging is going to fall apart. What’s going to happen in transit that’s different from us air shipping and handling it in a different way? We’ve had moisture problems that you have because of going across the sea. We have a lot of problems with wood because when you manufacture, it’s warm where you are. It’s humid and the product goes across the sea gets even moister. By the time it gets to the shelf and someplace dry and arid like California where I live, it’s a disaster of what can happen to the wood quality. We have to do things like that. These are the things you would never think of. I love that you pointed that out because it is so critically important to test on both ends.

Test on both ends and make sure that the test is done out of the mass production lot, and you’re there to verify that. That was another thing where we had a good contract in place. The factory, they take the products back, 100,000 products because we had a contract in place. Getting that testing in mass production is super important.

For a lot of our smaller players, that would destroy their business. That’s why you want to do these things on the frontend. You want to do them smartly, you want to get advisors like Rhod here. You want the smart information because you can’t risk that time loss and that money loss of the sales that you didn’t get from this large run that you ran.

If you don’t have the contracts in place and then something like that happens, it’s a disaster. You’ve got a whole heap of products shipped already that need to go back and then you have the logistics. Make sure you have to have that off front and get all the testing and the right testing on the right products at the start. This is very important because you can even see with the golden sample, if you tested a product on the golden sample and it’s not a preproduction sample, they can change. We’ve had times where the factory has tried to change the material of a handbag where we had the golden sample. It goes through the production and they’ve used a cheaper material from PU to PVC. It’s cheaper but then that PVC is toxic. It’s not allowed.

It fails a lot of tests around the world. I don’t even think you can ship it into Europe at all.

PLH 114 | Product Sourcing In Asia

Product Sourcing In Asia: Dates are very important because you have to keep everyone accountable through the outset.

 

To the naked eye, if you’re starting out, you can’t tell the difference. You need to have that testing on the golden sample and pre-production sample so that you can mitigate that. We catch that straight away, but if we didn’t know that, we’re going to ship products that are not allowed. Everything has to be done up front. Before you have that workflow chart of every single decision from the start so you can then see it, you see the whole product life cycle at the start and you get things in place. If you’re doing this thing after mass production, then you’re destined for problems.

Rhod, when do you like to see products and projects from people? When in the process, how early in the process do you like to see projects?

I think it’s very important that the startup at least is halfway there in terms of having a prototype or getting at least a very clear understanding of what the price is going to be in terms of if we start getting into CADs and designs. If you have something that’s very similar and you have a very good brief about what you want it to be. If it’s very early on, we have engineers that can help develop that whole product for you. If you have an existing prototype and you need the manufacturing side of it, that would go much faster because we can then lock it into one of us in our network and pair with a designer to help take you through that. Ideally, you’d want to at least get through the first stage so that you have something tangible that you worked with, which we can then plug into a battery that’s suitable rather than built it all on that stage.

One of the other things that I think is a great benefit of working with you is that you have this broader reach worldwide. If I’ve got a great product and I want to be selling it in the US but I’m concentrated only on that, but it might have great application in Poland or some other country or Russia or wherever. You guys have reached through those areas where you might be able to present them to distributors and catalogers who might want to take them on and broaden the ability for you to make a larger run, which lowers your costs here. That’s a huge advantage for you.

It’s awesome actually. We have that capability to assist on both ends so we can help create a product or get it manufactured and take them through all the design and production stage. Also at the end, we see if we can put that product into our vast distribution network and retailers, which is global. It’s quite nice for some startups to have that reassurance when they’re going through the production stage. That there is an opportunity to have outlets set up before the products are even made. They can have that confidence that at least the product we can put in front of some big retailers and pitch it to various channels in different regions. A lot of that is transferable over. We have a sample of a startup in the states. With that startup, there’s always worry about meeting MOQs. If you want to work with a good factory that’s quite well-established, you have high MOQs that you need to hit. Having that outlet, for example, for us to put them into a different channel and a different region can help alleviate some of those high MOQs.

Minimum Order Quantities, I like to define it in case our readers ask. You might be able to work with multiples, you can also help build a MOQ over time. In other words, within a few months we’re going to be buying these volumes because it’s going to hit these different countries and you can get a faster shipment and smaller MOQs upfront for its needs. You can also spread that out. That’s great leverage that you have and can help your clients with. Rhod, I’m so glad you came on the show. Is there anything else you’d like to share with our audience?

I would say just get started. Now is a better time in the whole human history to get started on your entrepreneurial endeavors and start a product or start a brand, particularly with eCommerce. There’s so much out there for you to be able to collaborate and learn from different people and get different experts helping you with each different aspect of the whole process like yourself. Let’s get moving and you’re in a great spot to be able to capitalize on this time.

Thank you so much, Rhod Needham from Market Source Asia. You can also reach out on social media and connect with him and with us through @HazzDesign everywhere on social media. I’m sure we’re going to have you back again. I’m sure we’re going to have some great success stories. I want to know some more in the future. Rhod, thank you so much for this. I look forward to talking with you again soon.

Thank you very much, Tracy.

This has been Product Launch Hazzards. I’m Tracy Hazzard and we’ll be back again with someone new next time. Take care.

Tune in to Rhod Needham’s next Office Hours. Connect with and find out more about Rhod Needham in our Experts Directory.

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About Rhod Needham

PLH 114 | Product Sourcing In AsiaRhod Needham is a product sourcing expert and a founder of Market Source Asia specialized in launching products and collections for both global retailers and start-ups.

Rhod has carried out a huge number and extremely diverse portfolio of projects and product categories ranging from travel retail to international fashion brands, to homeware TV infomercials, kickstarters, and global sporting associations and campaigns.