Finding a Top-Notch Manufacturer for Your Startup Finding manufactures is a daunting task, particularly when dealing with factories overseas. Here are a few tips on making it easier.
By Jason Lucash Edited by Dan Bova
Opinions expressed by Entrepreneur contributors are their own.
So you have your million-dollar product idea. Your mom, best friend and even your dog thinks your product is going to change the world. Now it's time to get it made. It's at this point when I begin to see panic and desperation in future entrepreneur's eyes. Finding manufactures is a daunting task, particularly when dealing with factories overseas. There's always risk associated with buying large quantities unseen, especially if you are dealing with a manufacturer outside your home country.
As the founder of audio-equipment company OrigAudio, I have had my fair share of ups and downs working with international factories, specifically in China. To me, China is the new Wild West, as the winds can change at any moment leaving you guessing on what you are actually going to get. For example, my company ordered hundreds of video displays from a China-based manufacturer. When they arrived broken, suddenly no one was picking up our calls or answering any of our emails. Ultimately, we were out hundreds of dollars with no working displays. This was an expensive lesson but taught us not to put all of our eggs in one basket.
There are many tips you can take to help reduce risks when working with manufacturers. Here are a few we have learned.
Related: Why Licensing is the Best Way to Get Your Product on Store Shelves
Ask for recommendations. I would ask your business contacts or friends to refer a factory that they use. Make sure your contacts have a longstanding relationship with the factory to lend additional credibility to their recommendation.
Get to know the rep. While seeing an online profile and an amazing warehouse may have you tempted to move forward in the buying process, have a little patience. Reach out to the factory and ask them to see a list of companies they have done business with in the past. Contact the businesses and ask about their experience. You can also ask the company to send you a small sample of their work to see how it looks in person. Lastly, if you have the resources, try to to attend several tradeshows in the location of the manufacturer, so you can meet your future rep in person and see what the quality of their work is.
Utilize online platforms. Because China continues to dominate the world of manufacturers, the country has a factory and B2B platform – Alibaba – that lets customers gain insight, compare costs and ask questions. Although this is a good resource, there is a chance of fraud and misinformation. Always check the company feedback, verification, if onsite premises have been checked, and if they provide speedy responses to your questions. It's also a good idea to test the factory with small orders before investing in larger ones.
Related: Creating a Product Prototype
Request a prototype. I would always recommend making a prototype of your product in the U.S. before sending the job overseas. It may cost more upfront, but it will save you a ton of time and money in the long run. You'll have more control over your product, speedier turn times, and you'll have a much easier time communicating your vision to someone that shares your language and culture.
Develop numerous relationships. It is important to establish relationships with several factories that make similar products. That way if one company falls through, you already have another factory that can pick up the slack.
Our Epishock Vibration Speaker faced this problem last year. When my partner and I went to pick up the custom tin lunchboxes the Epishock is packaged in, we were shocked to find the factory was no longer there. It was completely demolished and we had no idea. You're going to encounter extreme instability when dealing with manufacturers, so protect yourself the best that you can.
Creating your own product is a huge task full of heartache, excitement and headaches but seeing your vision come to life is always going to be worth the effort.
Related: 5 Tips for Creating a Prototype
