Entrepreneurs and established retailers are developing their own private label, direct-to-consumer products for ecommerce. But most of these DTC sellers don’t plan to manufacture those items in their own facilities with their own workforce, tools, and materials. Rather these businesses need a manufacturing partner.
Identifying a supplier, which may be located thousands of miles away in another country, is no small task. But it is not unique. Many businesses have done it successfully.
Whether a competitor is a massive company such as Apple or a small business selling skateboards, there is probably an analysis tool or an important document somewhere showing where your competitor has its products manufactured.
I recently spoke with Greg Mercer, CEO of Jungle Scout, an Amazon and ecommerce analysis tool. He described his company’s new supplier identification platform.
“We released something really cool about a half a year ago…it is a platform to find suppliers, but the data that we use for it is data that we get from the government organization that is in charge of customs and inbound shipments that are being imported into the U.S.”
“So through the Freedom of Information Act in the U.S. you can get access to government data, and we were able to do that.”
“What’s cool about this is we essentially have all of the data from all imports coming into the U.S. When I say data, I am talking about who is importing it…who manufactured or created the goods, and some other information like quantities and weights… But the reason this is so powerful… [is that] you can see what factories different companies are using to manufacture their goods.”
When you know who makes your competitor’s widget, it may be easy to go to the factory and ask for something similar. You might even request a few improvements based on customer reviews of the competitor’s item.
Some in the industry believe this is what Canadian retailer Peavey Mart did for its private label, duck cloth jackets and overalls. The products’ design and fabric are very similar to Carhartt jackets and overalls.
You might even take this a step further and learn if your competitor would be willing to manufacture for you, too. Mid-states Distributing Company, a retail membership organization representing 38 farm and ranch chains in the United States and Canada, recently launched a private label pet food brand, Wildology.
At the time of writing, Wildology is manufactured by Schell & Kampeter, Inc., doing business as Diamond Pet Foods. Diamond, a competitor to Wildology, manufactures dog and cat food for several brands.
Try to discover who is manufacturing one of the leading brands in the market and ask that company to make your products, too.
Supplier directories are another option for identifying potential manufacturing partners.
One of the best-known directories in the United States is Thomas Register and its Thomasnet website. This directory lists more than 500,000 suppliers. It describes the items those suppliers make and the services they provide.
You could also try Global Sources, which has a similar directory of worldwide suppliers. It is especially good at identifying component manufacturers — makers of consumer electronics.
And don’t forget Alibaba. It lists ready-made products to order and resell almost immediately. It can connect your business to China-based manufacturers, too.
Regardless of the directory, get references and samples to ensure your potential manufacturing partner will produce a quality product.
“If you talk to 1,000 sellers and said ‘hey, tell me a horror story about importing products,’ most of them would be around the quality of the goods,” Jungle Scout’s Mercer said. “Because a lot of times people will shop around [for a manufacturing partner] on price. But they don’t have a great way to gauge the quality of the product.”
The First Step
Finding a manufacturer takes legwork, whether you use a tool such as Jungle Scout or manually search for suppliers on Thomasnet, Global Sources, and Alibaba.
Thus identifying potential partners is only the first step. You will need to vet them, and they may want to vet you.
Moreover, you will likely go through a detailed and sometimes lengthy product design process, identifying, say, the product’s Pantone color code and the thickness of the cardboard to package it.