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February 28, 2024

Mastering the Product Development Process: Building Strong Supplier Relationships

For e-commerce brand owners, scaling their businesses with limited capital is a constant challenge. While a fantastic product is crucial, bringing it to market at the right time and price is equally important. This is where building strong supplier relationships becomes essential. Reliable suppliers ensure timely delivery, meet quality standards, and offer competitive pricing, all of which are critical for success.

Time Stamp

[00:00:00] Introduction To The Podcast Episode About Developing A Product From Concept To Delivery.
[00:02:30] Importance Of Focusing On The Product As The Heart And Soul Of The Business.
[00:05:00] Discussion On The Concept Phase: Understanding The Market, Identifying Customer Needs, And Creating A Clear Brief.
[00:08:45] Importance Of Defining The Product’s USP (Unique Selling Proposition) And Value Proposition.
[00:11:30] Transitioning From Concept To CAD Design And The Importance Of Collaboration Between Designers And Engineers.
[00:14:00] Discussing The Prototyping Phase, Including The Use Of 3D Printing For Early Product Testing And Iteration.
[00:16:45] Importance Of Human Testing And Gathering Feedback From Users During The Development Process.
[00:20:30] Further Discussion On 3D Printing For Prototyping And Testing Products In Different Materials.
[00:21:48] Importance Of Sitting With CAD Designers During The Design Process And The Value Of Physical Prototypes.
[00:23:23] Example Of Getting Products Into Consumers’ Hands For Testing And Feedback, Especially In The Cosmetics Industry.
[00:25:51] Importance Of Finalizing Branding, Packaging, And Production Terms Before Committing To Production.
[00:28:20] Discussion On Quality Control Measures, Including Outgoing Quality Control (OQC) And Supplier Due Diligence.
[00:30:24] Importance Of Supplier Due Diligence And Considerations When Selecting Suppliers, Including On-Site Visits And Audits.

Why Strong Supplier Relationships Matter

Bonnie Hall, founder of Census8, emphasizes the importance of supplier relationships, especially for startups. Suppliers are the backbone of your brand, impacting everything from product quality to pricing and delivery. Even with a great product, if you cannot get it to your customers on time and at a competitive price, your success will be limited.

The Product Development Journey Begins

The product development process starts with understanding your target audience and competitors. Research who your ideal customer is and analyze existing products in your chosen category. This helps you identify gaps in the market and opportunities for differentiation.

Consumer Research: Identifying Your Target Audience

Conduct thorough consumer research to understand your target audience’s needs and preferences. Analyze trends, read customer reviews, and identify areas where existing products fall short. Based on this research, create a clear picture of your ideal customer and why they would choose your product over the competition.

Adapting the Approach for Established Businesses

For established e-commerce businesses transitioning from reselling to developing their own brands, the focus shifts to specific goals. You might prioritize reducing out-of-stock situations (OOS), achieving better pricing through higher minimum order quantities (MOQs), or managing longer lead times. Researching competitor packaging and visiting trade shows can provide valuable insights during this stage.

Developing New Product Lines for Existing Brands

When developing a new product line for an existing brand, start by outlining your desired outcomes. Do you want to modify an existing product, create a completely new one, or simply rebrand and repackage an existing item?

Choosing Between Redesigning and Developing from Scratch

The decision between redesigning and developing from scratch hinges on several factors, including cost, desired speed of market launch, and product category. For instance, in the cosmetics industry, creating unique packaging for an existing product might be more feasible than developing a brand new formula.

Reskinning Existing Products: Working with Suppliers

Reskinning existing products presents a significant opportunity to create perceived exclusivity while leveraging existing functionalities. Collaborate closely with your supplier to determine feasibility, cost, and potential modifications. This might involve creating 2D and 3D drawings and working with the factory’s design team to achieve your desired outcome.

Effective Communication with Chinese Suppliers

Clear communication is vital when working with overseas suppliers. Provide detailed examples of desired textures, colors, and finishes. Consider sending physical product samples or using 3D printing to ensure accurate communication and minimize the risk of misunderstandings.

Market Research Example: Developing a Massage Oil

Let’s explore market research for a massage oil product. Researching UK manufacturers specializing in cosmetics ingredients and scents allows you to identify potential partners and explore various options. Develop small sample bottles with different scents and gather feedback from testers, including colleagues, friends, and customers. Utilize product testing forms to collect feedback on scent, feel, perceived value, and overall experience.

Moving from “Gold Sample” to Production

Once you have finalized your product based on market research and testing, establish clear terms and conditions with your supplier. Understand any potential duties and costs associated with cross-border transactions, and estimate freight costs before shipping.

Implementing Quality Control Measures

Quality control is crucial, especially for new products and designs. Conduct thorough inspections throughout the production process, from raw materials to finished goods. For established products, consider category-specific quality control measures. Utilize freight companies to randomly select samples for inspection, ensuring product consistency.

Supplier Due Diligence: Building Trust and Confidence

Whenever possible, visit your supplier’s facilities in person. If this is not feasible, consider partnering with companies like Kima or SUV to conduct audits on your behalf. Utilize standardized audit checklists or request recent audit reports from your supplier. Video walkthroughs can provide valuable insights if physical visits are not possible. Assess the supplier’s staff, production line, and quality control procedures. Understand their process for handling defective products and their in-house testing capabilities.

Conclusion

Building strong supplier relationships is essential for e-commerce brand owners seeking to scale their businesses effectively. By following these steps and investing in communication, research, and quality control, you can establish partnerships that contribute to your long-term success.

Get in touch with Census8 for a free consultation to discuss your new product ideas. We offer a 30-minute call to provide initial feedback, explore potential collaboration options, and share valuable tips for your next steps.

 

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Michael Veazey


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