MANUFACTURERS - STEP-BY-STEP SECRETS TO STARTING AN E-COMMERCE STORE

16. Manufacturers
 
Choosing your product goes hand-in-hand with finding a manufacturer. You could make the product or create the service yourself or you could outsource the manufacture of the product.
Deal with manufacturer and not the middleman trader.
Find and compare prices and quality from at least 3 suppliers.
When approaching a manufacturer remember to ask about MOQs.
M.O.Q’s
Minimum Order Quantity. Remember to research this before you order as minimum quantities can raise your costs substantially and then you may be stuck with stock you cannot move but have to store. There are companies who will make low quantities some even will make one-offs.
The reason manufacturer’s often have MOQs is it costs them less to make a number of the same item and thus the order becomes more profitable the higher the number of orders. There is less waste of material as well and better use of staff time.
One major disadvantage with inventory and m.o.q’s is that your capital is tied up. You have to store the inventory and if it does not sell this is a very unsustainable environmental model.
 
If you want to develop your brand ask if the manufacturer can provide a Private Label service where only your brand name appears on the product. This is exclusive to you.
Under a White Label agreement a manufacturer can sell the generic product it makes to many different retailers.
You will need to get samples made which will have a cost factor involved.
If you look for local manufacturers you will save on International shipping and the potential delays that go with that. It is much better for the environment to manufacture locally.