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Amazon Sellers & Product Sourcing

By Jesus David Cano Romano
April 8, 2016
Product Sourcing- Long Road Ahead

Nick Cunningham, Owner at China 2 West, recently had an interview to discuss the difficulties of product sourcing. The interview is dealing with challenges including product research, selecting the right manufacturer, and maintaining quality control. To read the full interview click here.

Before we’ll share the 15 Takeaway Tips from Nick Cunningham we want to take a quick look at one of the many inspiring stories of successful product sourcing.
In 2014 an idea about an inflatable air lounge was born. From the very beginning until the final launch, it took the team around one and a half years. Around 50 % of that time the team was busy with testing and prototyping their product with their suppliers for optimization. Currently, Kaisr covered more than 10.000% of its required investment with more than 12.000 pre-orders before the production has even started.
It’s a time and nerve consuming process until you have the finished end product in your hands. So do research, look for people with experience and maybe find an agency to help you saving valuable time and money, finding the right supplier and avoiding unnecessary pitfalls.

China 2 West has many years of experience with product sourcing and here are our 15 tips to help you succeed.

15 Expert Takeway Tips for Product Sourcing

  1. Factory audits essential to save time and money in the future
  2. Understand the difference between price and cost – The price is the number shown in the quote. The cost is the actual number you will pay when taking into account your time, travel, product defects, returns, loss of reputation, risk etc
  3. Get legal with contracts, etc.
  4. Make a solid QA plan with critical & minor defects
  5. Ensure material specs are part of QA plan to avoid bait and switch (i.e. Substituting inferior materials)
  6. Fix an ROE and base raw material price and agree an open resource where both parties can check price fluctuations (Bank of China, LME etc).
  7. QC Inspections essential – plan a mid and end production check
  8. Give yourself as long lead time as possible (quality vs speed)
  9. Understand that if QC inspection fails, product will need rework (delay & complications – factory probably won’t take responsibility)
  10. Do not pay balance until after thorough QC check
  11. Arrange batch laboratory or functional testing on critical component or materials
  12. Do your research on suppliers (by internet and by factory visit/audit)
  13. Get a solid NDA in Chinese language, recommend commercial law specialists in Hong Kong
  14. Make sure NDA is signed and stamped as per contract rules
  15. Get a China patent