Introducing: Starting your own product
Start-up Difficulty : Hard (recommended to start or perfect dropshipping first)
Start-up Costs: $2000 to Very High, Depending on costs arising from your Production Creation
Potential Returns: Minimally double your investment per year if successful
So, let’s start:
Simply for this method to work, in order to get income we need a product to sell.
Creating a product
Look for a product with minimal competition, but is already selling well. Once you’ve researched the product, find a reliable and trustworthy manufacturer that offers OEM. Request an initial sample order from your manufacturer and negotiate the price and shipping. Create a brand, logo, and foundation that you can grow past your initial product and the umbrella of eBay and Amazon. Finally, create an amazing website / eBay listing / Amazon listing that’ll introduce your baby to the world!
Creating your own private label is not a get rich quick scheme you can implement overnight and hope to become an instant success. Like most things worth doing, it takes time, planning, and sometimes a little luck. The most important things to remember is to be patient, vigilant, and detail oriented.
Two simple ways:
1. Private Labelling Locally
Of course, the easiest way to create a unique product is by using the private label method. You’ll find plenty of suppliers in any niche if you can find the manufacturer of the product you are seeking. Contact them directly and ask, most factories provide an option to private label. I also advise you to start small and increase the ordered quantity in a progressive way. Regarding the origin of the supplier, it preferred to have a supplier which is located in the same country as you. Of course, prices in China are much lower, but it would have been too much hassle to find a reliable supplier there (But much more profitable), which would be able to deliver the goods in a timely manner, and packed according to Amazon requirements (which are a LOT!), and take care of the customs procedures…and…and…and (a lot of other factors).
As with private labelling, look for OEM in Alibaba and you will find anything under the sun available in any niche that allows you to start an online eCommerce business. Chinese suppliers are, in general, very flexible. They make products according to buyer specifications. The positive aspect of this is that you can essentially get any product out there for your own brand.
First, you need to find out what sort of products the supplier has existing tooling for.
Second, you need to get a list of product specifications.
Read more on Private Labelling with local suppliers or Alibaba and the different methods here.
Like most business, be prepared to put a lot of work in the beginning, finding a sellable product, a trustworthy warehouse, and creating an appealing brand. However, after the initial investment, you can scale your participation depending on the type of income you desire from it.
First, let’s work on your vision. Ask yourself, what is your main objective?
You need a goal. Followed by multiple mini goals to keep yourself motivated and keep track of progress in order to continuously work towards it.
You want a passive online income of $2,000 per month. You will need to target for that first sale and build it up. Analytics can assist in finding out what works and what doesn’t. I recommend Prosper 202 for tracking your clicks. Build up your sales from the proven techniques written on this website and build yourself a new online business.
If you want a small passive supplemental income (>$2,000 per month depending on your lifestyle) then once you’re setup, you can take a huge step back.
But if a larger payout is required, a lot more work needs to be put in to maintain a steady stream of substantially higher income(> $10,000 per month).
If later on, you find you want to add additional products to grow your brand and start making it your primary business, you also have the option to step up and start growing and branching out into different niches(very important!).
The great thing about private labelling is that you can scale it to be as large or as small as what best fits your life. This method may be daunting to newcomers but with a little help or prior dropshipping experience, you should be able to grasp the concept quite easily. With the step by step guide below, it should guide you to getting started with success.
STEP ONE: THE PRODUCT
Although when you start reading this, the process is going to seem exhaustive and impossible, I will reiterate that most of the heavy lifting is in the preparation works. Once you start selling, it is more towards the passive side. This is the most important step, and one that will take up the majority of this how-to.
The first, and most obvious step: you need a product. The good news is, you don’t need a master’s degree in business, or be an eCommerce wizard to choose one successfully. Everyone has had their own life experiences and you should know which product is good for you and which product really works.
But how do you go about picking one? Fortunately, most online marketplaces do the work for you. The first thing you should do is check out the best sellers on eBay and Amazon and see what’s already selling well. Finding bestseller rankings on Amazon is easy, there are even companies that help do it for you, like Jungle Scout. Unfortunately, eBay can be a little trickier. You can subscribe to eBay Marketplace Research, which makes this process pretty seamless, or use a tool like MerchantWords to find trending products. Another (free) option would be to checkout eBay’s trending collections. There’s absolutely no shortage of softwares to choose from to perform research on keywords and bestsellers. An example of one would be Terapeak, which has great features like product sell through rates and even offers a free trial.
While sorting through all these products, you’ll want to look for a product that has a ranking of less than 1,000 and has less than 1,000 reviews to ensure the market isn’t already saturated. Next, check out your competition. How many other people are selling this product? Ideally, your competition should have average or (better yet) below average quality. If they have measly descriptions and only a few pictures that do a lackluster job of showing the product– that’s good news for you.
You may have to compare what’s selling well on Amazon to some of the “hot” sellers on eBay to get the best picture of how a product is doing online. Mostly though, it involves doing a lot of research to find the right product that both speaks to you and your potential customers.
This process takes time. This can take anywhere between a few hours to a few weeks for you to find the right product. It’s better you spend the time on researching now, rather than losing passion or (more importantly) money on the wrong decision later.
STEP TWO: THE SUPPLIER
This step is usually met with the most objection. That’s because China is still the dominant player in contract manufacturing. So, if you’re a little reluctant to outsource to China, that’s totally understandable. But you’re going to have to work a lot harder to find a manufacturer in the locally that will be able to offer you products at a cost you can turn a profit on. Therefore, it is recommended to source from China as most successful players focus on outsourcing to China. Always follow what works best.
So where do you find one? Although there are several websites that will do some of the manufacturer negotiations for you, they also try to earn the most out of you. Thus, let’s focus on making you as much money as possible. So, my suggestion is to start your search on Alibaba. Conduct some searches for your ideal product and scroll down to the product descriptions. If you see something that says custom accepted, customizable, branding, white labeling or (most likely) the term “OEM” (original equipment manufacturer) that means you can use them as a manufacturer for your private label product.
It is recommended to look through their reviews to make sure they have experience and reputable. When you begin contacting manufacturers, keeping a mental note of their response rate as you communicate with them. They’re located across the world, so you can expect some delay in response, but just keep in mind that their response rate may only get slower once they already have your money. So, with anyone you conduct business with, pick someone you can trust.
Manufacturers may they charge you to print your logo on your product. Many either include it in the price or provide the service for free, but some will charge you some minuscule amount per item.
Ideally, you should look for a manufacturer that does not sell directly to customers. Using ones that only sell through third-party vendors (like you) means the market is likely less saturated with those products.
It would also be good to keep in mind that most manufacturers will not accept PayPal (this is normal). In addition, don’t be surprised if they accept PayPal for your first sample order, but refuse to use it later for your full orders. They may do this at first to show goodwill, but most greatly prefer (insist may be a better word) to use cashier’s checks or a money wire. So, in general, just be prepared to be disappointed when they refuse your PayPal payment.
STEP THREE: THE SAMPLE
Okay, so let’s get into specifics. You have a great product and a manufacturer you can trust. Next, you need a sample. You’ll need to be as specific as possible. What may seem obvious to you, may not be as obvious to someone else, and the language barrier will only hinder communication further. When possible, send pictures, drawings, and written details about the specificities of your product. Once your product is shipped to you, there’s usually no returning it– shipping is expensive and most manufacturers just won’t do it. So it’s best to get as many samples are as necessary so you aren’t stuck with thousands of useless products.
When you think you have every detail accounted for, you’ll need to order a sample so that you can make sure it’s meeting your expectations. However, what you’ll find is that most manufacturers have a minimum you are required to order at a time. It’s time to drum up your negotiation skills (and get used to using them) because you don’t want to get stuck with a huge order that has your logo printed incorrectly or doesn’t meet your brand standards.
Manufacturers are usually willing to negotiate the quantity for your first order if they think you’ll return for more orders in the future. Tell them it’s a sample and show them you’re trustworthy and interested in working with them. While admittedly, it may be a little frustrating to buy fifty or a hundred of a product that you’re not sure you can use, the investment will be much less costly than purchasing 500 units of something with the incorrect logo. You can use this order as an opportunity to disperse your product to friends and family to get their opinions on your branding and the product itself.
Keep in mind that most of the quantities and prices you see are negotiable. You really don’t (and shouldn’t) have to settle for whatever cost they have listed on the website. Do a lot of research and make sure you’re starting off with a good product at a decent cost and then see where negotiations can get you from there. Keep in mind people negotiate these prices with them all the time.
STEP FOUR: SHIPPING
Shipping basically comes down to two options: air cargo FOB or ship. While having your products shipped by air means they’ll get to you a lot faster, as you probably expect, it’s going to cost you a lot more. However, don’t even plan on getting your inventory in less than a month if you decide to go by ship.
On this step, it is also recommended to pick up some abbreviations of shipping terms.
FOB: “Free On Board” is a trade term that indicates whether the seller or the buyer has liability for goods that are damaged or destroyed during shipment between the two parties. “FOB shipping point” (or origin) means that the buyer is at risk while the goods are shipped, and “FOB destination” states that the seller retains the risk of loss until the goods reach the buyer.
CIF: “Cost, insurance and freight” is a trade term requiring the seller to arrange for the carriage of goods by sea to a port of destination, and provide the buyer with the documents necessary to obtain the goods from the carrier.
Delivery by air means it can be delivered directly to your home, warehouse, or FBA location. With that being said, the downside to boat delivery is that sometimes getting it out of the port it’s delivered to may require a bit of planning and logistics. You’ll need a freight forwarder for custom negotiations and fees.
STEP FIVE: YOUR BRAND
While your product is making its long trek across the sea (whether by air or boat) use this opportunity to create and curate your brand. Consider where you see your brand five years from now.
When picking your brand name, consider what other products you may begin including as you expand in the future. This brand name should sound suitable for all future products you plan to release.
Next, and perhaps the most fun, is picking a logo. Try to keep it simple. Adding a bunch of colours and intricacies into the design will both cost you additional money for printing and likely not show up well when scaled to smaller sizes. There are several websites available that artists offer their services to design the logo for you. You may try checking out Fiverr as a start, however, I’d recommend checking out several different websites and artists. Think about investing $50 on logos from several artists so you have several options to choose from.
When choosing your name, make sure it’s still actually available. Do some google searches before you finalise. Choose a name that has as many social media and domains available as possible. If just one thing is taken (like Twitter, Facebook, or Instagram) then see about reaching out to purchase it from the individual. Ideally, however, you only want to use a name with an available domain, always look for an available .com domain because in the long-run you should be thinking about growing your brand and business outside of eCommerce marketplaces and selling on your own website. You never know, your business might be an overnight success and it will cost a lot more to get that .com in future.
After spending all this time creating your brand and product, you should consider spending a few minutes to protect it. Look into what it takes to copyright your name and logo in your country.
STEP SIX: CREATE A KILLER LISTING
So you have the product, the manufacturer, and the brand. The only thing left to do is create a listing that’ll show all your customers why they should buy from you. This is where many sellers drop the ball (and you have the potential to pick it up). Always keep yourself motivated.
You spent ten minutes reading this article and taking notes, and maybe months creating your product. It’s ridiculous to slap it online and just expect it to sell itself. Invest in a professional photographer or at least a lightbox to get quality pictures taken with your product. If it’s a lifestyle item, make sure at least one of the pictures in your listing includes someone using your product. Unprofessional pictures reflect on you as unprofessional. And why would someone want to trust a company that isn’t?
Include as much detail as possible in your listing. Keep in brief and bulleted for the beginning of the description then go into more detail of the products and features below. This allows people to easily scan the information they’ll need and then read further if they have additional questions.
A common thing people forget to include is the product measurements. Including this simple thing can reduce returns. It allows the customer the opportunity to set expectations according to your description so you don’t get return requests reading, “it looked so much bigger in the picture”.
However, other than selling on eBay, there are two more proven paths in the links below:
SELLING ON AMAZON
If you don’t feel this is a good fit to your current experience and lifestyle, try other online income strategies.