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One of the biggest hurdles for successful sourcing is the very first step of identifying what product to buy, where to sell and which country to sell and which country to source from. Finding great products to sell online profitably can be a challenging task. There are many thousands of choices, yet, everything seems like it's been done a thousand times before .With all these choices where do you even begin? An initial step to finding products to sell is to be able to recognize the various opportunities that exist for uncovering great products. Understanding these product opportunity types is key to identifying great product and niche opportunities.

• INTERNAL

  What product niches or industries are you particularly passionate about or interested in? What pain points or frustrating experience do you have in your own life?

• LOCAL COMMUNITY

  Look around local retail concepts and products, review local newspapers for new, innovative and local concepts and products.

• CONSUMER TRENDS

  Following trend publications is a great way to begin getting a sense of the direction consumer products are going in and the ideas other entrepreneurs are introducing to the market. These publications can also expose you to new product categories and industries that you previously didn't know about.

• PRODUCT REVIEWS

  Product reviews are a fantastic source of ideas and inspiration There are many sites that provide curated product trends daily. This is a great way to get inspired with a every day glimpse into the new and innovative products global entrepreneurs are bringing to the market.

• B2B MARKETPLACES

  This has been a popular option amongst entrepreneurs for a while. Wholesale and manufacturer sourcing sites, like Alibaba, exposes you to thousands of potential product ideas. It can be easy to get overwhelmed with the sheer amount of product available so you need to take your time.

• CONSUMER MARKETPLACES

  An incredibly rich source for product ideas is the online consumer marketplaces . Many sites exist, and continue to pop up, in this space such as Taobao and eBay, however, it is also well worth reviewing crowd funding innovation sites such as Kickstarter or Indiegogo.

Over the last decade, outsourcing of consumer products has become an increasingly routine decision about which provider to use and how. However, in today’s world of digitalization and online marketplaces, a trend is emerging where a number of organizations are considering whether to insource. There are many options available in terms of who your sourcing partner should be, the below table outlines some pros and cons of the most popular options.

PROS

USE A MARKET PLACE

• Easy to use.
• Instant access to hundreds of thousands of manufacturers and suppliers
• Basis vetting process for listed sellers.

ATTEND A TRADE SHOW

• Access to networks, people, resources, recommendations, and referrals that you would not have access to otherwise.

VISIT A FACTORY

• Showing up lets the factory know that you’re a serious buyer. They’ll treat you seriously.
• Verify the factory can actually produce your product.
• You can tell a lot by visiting on-site and looking at the working conditions.
• Faster and clearer communication in person.
• Build a stronger relationship with factory manager.

HIRE AN AGENT

• Agents will speak multiple languages, and have access to supplier networks that you don’t.
• Saves you time by not needing to deal with multiple factories.

WORK WITH A PRODUCT DEVELOPMENT FIRM

• Everything about the production is managed for you.
• In-house expertise for design, production, sourcing

CONS

USE A MARKET PLACE

• No competitive advantage (your competitors have open access just like you do)
• Need to sort through a large number of trading companies and middlemen masquerading as manufacturers.
• Some of the best manufacturers aren’t listed

ATTEND A TRADE SHOW

• Initial cost of attending (flight, hotel, ticket).
• Time investment.

VISIT A FACTORY

• Showing up lets the factory know that you’re a serious buyer. They’ll treat you seriously.

HIRE AN AGENT

• Agents will charge anywhere upwards of 3% - 4% of sales.
• Sometimes agents will refer business to factories that pay them a commission, rather than working in your best interests.
• They may not have domain knowledge like you do, which means their judgment may not be reliable.

WORK WITH A PRODUCT DEVELOPMENT FIRM

• It will cost a lot more than a sourcing agent

Importers of consumer goods have always focused supplier selection on many attributes, but often too heavily on price alone. However, as consumers and industry have put a stronger emphasis on quality; evaluating, selecting and partnering the right supplier today has become much more critical and complex. Selecting the right supplier can help drive customer demand and build a strong brand reputation of quality products. Below are some steps to consider in an effective supplier selection process.

Identify a Supplier: Before selecting your supplier, it is important to gather the opinions of your stakeholders and define the criteria for the selection process.

This will identify the critical attributes of the order: cost, time, speed, as well as finished product quality & safety. You should also consider which country would best meet the criteria and then benchmark a few suppliers to assess their capabilities and compare pricing.

The ultimate goal is a win-win situation for the supplier and yourself; as such, open and transparent communication is critical

Key to success is value, cost alone is not the only criterion. In the supply chain industry this is often referred to as total cost of ownership, which looks at the supplier’s:

• Customer service
• Delivery commitments
• Reliability and responsiveness
• Resource savings (hard and soft)

Thanks to TrustSource Insights, you can identify risk ratings of different countries performance for your desired product with our risk radar that assesses millions of data points providing you with the necessary knowledge to make an informed selection.

Measure Supply Performance: A critical step of the supplier management process is developing an audit and assessment program.

Gain Supplier Feedback: Another tool that is often used is a self-assessment questionnaire

Develop Partnerships: Ultimately, the supplier relationship is at its best when a strategic partnership is formed.

Guidance Points

Selecting the right supplier can help you meet the consumer demand for higher-quality products. When selecting the right supplier, you should remember to:

1. Include all key internal and external stakeholders in the process to agree on important criteria that the supplier should meet.
2. Assess performance through useful metrics and provide the necessary feedback to the supplier. 
3. Require strong communication between yourself and the supplier, poor communication almost guarantees a failed relationship.
4. Motivate your suppliers to develop strategic partnerships to ensure the greatest opportunity for success for both parties.
5. Perform audits for the selected supplier, and work with them to address any deficiencies. If the deficiencies are too great, move on to another supplier. Implement adequate monitoring to drive improvement in supplier performance.
6. Invest sufficient time, effort and energy early in the relationship to set up for success.

A key risk when buying consumer products is the verification that the product you have ordered is the product that is being manufactured and will ultimately be shipped. Identifying and fixing potential issues early in the production process before it has been mass produced and even shipped is crucial. Quality products drive customer satisfaction and loyalty whilst reducing the risk and cost of replacing faulty goods.

Customer Expectations

Your customers demand, and expect you to deliver, good quality products. If you do not, they will soon look elsewhere. Quality is critical to satisfying your customers’ needs and retaining their loyalty so they continue to buy from you in the future. Quality products additionally enable you to charge a premium for your products.

Reputation

A quality reputation & strong customer feedback, is vital to your company’s reputation, especially when looking to sell to the world’s leading retailers. This is especially true in today’s world of social media where customers and prospects can easily share both favorable opinions and criticism of your product quality on forums, product review sites and social networking sites. A strong reputation for quality can be an important differentiator in markets that are very competitive. Poor quality or a product failure that results in a product recall campaign can create negative publicity and damage your reputation.

Costs

An ineffective quality control system will incur the cost of missed shipment including additional costs of air over sea/road transportation. If defective products reach customers, you will have to pay for returns and replacements.

Verification

Bureau Veritas verifies the quality of the product, and the quantity. It can also monitor the timely delivery, if a multi-intervention program is put in place for high volume or critical orders. Without a quality control plan in place, production schedules can fall behind and you might miss your sales season, resulting in low product turnover.

At its root, “Logistics is about getting the right product, to the right customer, in the right quantity, in the right condition, at the right place, at the right time, and at the right costs,” otherwise known as the Seven R’s of Logistics, as coined by John J. Coyle

Key areas of quality concern that need to be considered when sourcing consumer goods are:

Quality Rejects: 

Sometimes goods leave port in good condition, but at the destination port, often due to faulty containers, shipped goods are damaged. (Water seepage, dust, rust, etc.) This causes a rejection for which nobody takes accountability easily. A loading and unloading check supported by a container survey done before goods are packed and sealed can help mitigate this risk.

Documents & Certificates: 

One major problem is understanding documentary requirements of different countries. A particular product may require certain kind of certificates and documents for one country which is not the same for another. This can cause confusion, incorrect paper work and stopped shipments.

Logistics: 

A crucial part is played by logistics in international trade; this can become one of the biggest pain points when things don't move as they were meant to. This includes, delay at port of loading, delay at transshipment, cancelation of inbound vessels and many more such delays.

Bureau Veritas can provide loading and unloading checks to verify the products being shipped and unloaded are as per your instructions.

Quality is instrumental in driving retail sales. Whether you sell through marketplaces, your own online or physical store or via another channel, maintaining a strong reputation for quality products is critical to driving client retention and order growth and also reducing the level of returns due to poor quality which can eat away at the margin.

One of the biggest costs that needs to be managed is the reduction in the percentage of products being returned due to poor quality ... 

The stats vary, but around 10% of physical stores' products are returned due to poor quality whilst almost 1/3 of products sold online are returned. Around 1/5 of all returns due to damaged products or poor quality. This equates to 1.8% of all physical store sales will be returned and 6% of online sales.