How entrepreneurs can avoid losses in overseas sourcing, from Market Source Asia.

In the product design world, Asian sourcing is an ongoing conversation. Volatile and sometimes unpredictable markets, coupled with the ebb and flow of retail markets creates a space that can serve up incredible opportunities, and big time failures.

Based out of Hong Kong, Rhod Needham, owner of Market Source Asia, is working to smooth out the sourcing wrinkles and show businesses how to amplify the opportunity while minimizing the risk. Needham and I met at the Global Sources Summit where we talked about retail, sourcing and product development, for so long we missed a speaker’s presentation, and the highlights of that conversation are here for you.

A Shifting Industry

Market Source Asia, whose mission is to “help the world keep up with it’s ever evolving imagination” launched after more than twenty years in the sourcing and product development space in response to an industry shift. In the age of Kickstarter, ecommerce and ‘tech’, a new world of consumer goods has evolved. Needham says they focus on bringing value, while bridging the gap between advanced product innovation and ambitious consumer demand. With their end-to-end product develop process, Needham can speak from first-hand experience on sourcing changes, must-knows, and must-dos.

Experience Is Money

Every product, when you are learning, is a new experience, with new testing, and new validation efforts; and getting to know the product category, what sells in that category, and what you can bring to the table that gives this round of products an edge in the market. But the experiences gathered during these processes are definitely accumulative. Experience matters when it comes to sourcing because, even if product categories don’t overlap, the materials or processes might. The more product categories you have experience in, the more broad the scope of knowledge is in general material, sourcing, potential issues, and what is going to work best. Knowledge is transferable here, and the processes and best practices become consistent, while the details have freedom to move.

Time Spent Is Also Money

Nothing beats being able to be on the ground for certain parts of the process in the development of your product. And if you can’t, having someone on the ground who can run quality control for you is incredibly important because if you’re waiting until the “end of the process” to run quality control, it’s too late. Plenty of entrepreneurs think, having never met their manufacturer, they’ll drop in for the final sign-off and this spells absolute disaster. Get involved, and put your time into the process. This will save you money and from a potential massive failure.

Systems, Systems, Systems

There needs to be systems in place, like contracts, and sign-off samples, and workflow charts. New entrepreneurs coming in often don’t have these processes or awareness of these processes, because it’s all new, and unless you’re working with a sourcing company, this information would not be incredibly obvious. We’ve stepped in to clean up numerous situations over the years, where the entrepreneur went into sourcing with a contract, without signing off on samples step-by-step, without understanding the amount of time from start to shipment. These are huge elements, and create an ecosystem where failure and devastating losses can happen quickly.

Contracts Set the Tone

Contracts, in so many cases, are less about the legality, and more about setting the tone and creating standards that your partners and manufacturers know to follow. These contracts create space for communication, which is one of the most important parts of the process. Strong communication helps build a foundation for these partnerships, and also leaves room for understanding, growth, and future possibility. This also creates a reputation for the entrepreneur, showing that there is commitment and a level of professionalism from you.

Product Sourcing Expert Tip

One thing I love to do is have two completed samples, one that I sign and keep and one that the manufacturer signs and keeps, and uses in the manufacturing process. Needham also pointed out that you should take photos of the final sample as well, because if the sample itself is lost, you might be missing key details or find yourself doing work over again, or traveling back for an unplanned trip, which isn’t productive for time or money.

Read the original INC article published on July 22, 2019.

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