This post is by Danny McMillan, a private label seller and international speaker on selling through the Amazon marketplace. Danny is a music industry survivor and serial start-up entrepreneur, focusing on Amazon FBA for the last two years. As a public speaker, he has appeared at events including the Smart China Sourcing Summit, Private Label World Summit and the European Private Label Summit. He can be found at DannyMcMillan.com.
I’ve been private labeling for a couple of years now: sourcing products from China, creating a brand and selling them through Amazon FBA. I haven’t nailed it by any stretch of the imagination, but I’ve been through the sea-shipping process six times, gained some amazing experiences and learned a lot of lessons along the way.
Back in May I wrote about my first visit to China and the Canton Fair. Trade shows are a fantastic way to scout for new products and meet suppliers face-to-face. Not long after, I decided to embark on a new product launch with my supplier. I worked through product selection, branding and manufacturing without too much trouble. One task remained: shipping the finished products over from China in time for Christmas. It’s just moving something from A to B. Should be simple, right?
Wrong. It turned out to be the most difficult and unpredictable experience of my private labeling career so far. Murphy’s law tells us that everything that can go wrong will go wrong. And it did. I was asked for paperwork that I hadn’t needed before. As soon as I had jumped through that hoop, I was asked for more documents. That happened again and again. Then the payment to my supplier went through early, before the products had even been inspected. After that, we had hazardous material issues with the shipment. Then the boxes were damaged on the way to the port in China. Any one of those problems would be enough to lose sleep over.
But Murphy’s law was wrong. Not only did everything that could go wrong go wrong, things that can’t go wrong went wrong too. My shipment ended up slap-bang in the middle of the biggest economic disaster to hit the freight industry in the last 100 years: the bankruptcy of the world’s seventh-largest shipping company. It was completely unprecedented, and nobody had a clue what was going on. Would my products ever see the light of day?
So here it is: my nightmare story of getting one shipment over from China. I’ll be candid about what happened, and tell you everything I learned. I hope it helps you avoid the same problems.
Think of an entrepreneur, and it’s likely your image will be of someone who is extremely busy: taking calls, responding to emails, and dealing with dozens of problems that come up every day. It’s a manic life, or so we’re led to believe.
One entrepreneur who takes a more relaxed approach, but still manages to be extremely successful, is private label Amazon seller Adam Hudson.
In this interview, Adam talks about how he built a business with annual sales of one million dollars and a really high profit margin. He puts about 15 minutes a day into the business. This is how private labeling is supposed to work, but very rarely does.
Adam also bucks the private label trend for low cost, low quality products. He doesn’t try to screw his Chinese suppliers on price either. In fact, when he receives a quote, he asks them to charge him 20% more. Why would anyone do that? Read on to find out.
This post is by Danny McMillan, a survivor of the music industry and serial startup entrepreneur. For the last couple of years Danny has focused on Amazon, and joined forces with Anthony Vaughan last year to co-host the The Amazon Seller Meetup events and Webinars.
As news broke yesterday it seems the internet has gone into meltdown. In case you’ve been hiding under a rock, yesterday Amazon banned incentivized reviews in the US (no UK announcement yet). These are the reviews written in return for giving products away (or at a heavy discount) and they have been the lifeblood for so many Amazon private label sellers.
At this precise moment in time no one truly knows how it will shake out. Sometimes stepping back and looking at the bigger picture and observing the lay of the land can produce dividends. We must remember getting reviews are only part of the equation and not the sole factor for success.
But if you are following the trend of, “product fits in a shoe box, pick it up for for cheap in China, stick a badge on it, do loads of giveaways, turn on PPC, collect cash on the way out”, then you are going to have it tough, especially if you are banking on high volumes.
A profitable online business that’s growing in popularity is importing custom manufactured products from China and selling them through the Fulfillment by Amazon (FBA) program.
One big advantage of sourcing your own product from China is the ability to be unique. While the competition is selling the same products as everyone else, importing a product from China and making it your own by private labeling means you’re the only supplier. If that product is in high demand, being the sole supplier can be a very profitable position.
The gurus hawking FBA as the ultimate risk-free path to riches make it sound easy to turn all your ideas into successful products. One post I read advised to take your idea and head straight to Alibaba.com, a site where Chinese manufacturers and middlemen advertise the products they’re capable of producing. The post encouraged you to custom manufacture 1,000 units of the product and ship them direct to Amazon’s warehouse and, from there, sell them on Amazon at fantastic margins. The perfect online business, they say!
Until one of your products burns someone’s house down – as happened in the recent spate of hoverboard fires – or a child gets hurt.