At one point or another, we’ve all had that idea.
You know the one for some revolutionary new product that’s going to change the world and make you millions?
Yeah that one.
The problem is, the vast majority of us never do anything with this idea. The idea of actually creating a physical product can be so daunting that it’s easier to just assume it can’t be done and move on with your life.
Then kick yourself a couple years down the road, when you see that someone else created your physical product and is now making bank off of it 🙂
Over the years, I’ve personally experienced this a few different times, which I’ll share about in this post.
But the good news, is that I have good friends who have (very) successfully manufactured products in China, and turned them into multi-million dollar brands – and are willing to talk about how to do it!
In this blog post we’re going to cover the exact steps you need to take to come up with an idea, validate it, find a factory to make it, and launch it to (hopefully) massive fanfare as you build your new brand.
If you’ve been sitting on an idea, and have something you’ve been wanting to make, then read on, as this will outline all of the best starting points for your new business.
My good friend Nick Ramil is the founder of Enter China, an accelerator program that helps new founders go through this exact process. We were recently on a mastermind retreat on the Oregon Coast and sat down to talk about this exact process. So be sure to watch the video as you’re going through this post.
How I Went to China and Missed Out on a $40 Million Dollar Business Opportunity
So in order to fully understand why I’m writing about this on Location Rebel, you need to understand a little bit about the biggest missed opportunity of my life.
A few years ago, I decided to take a trip to China and see what kinds of opportunities I could find for myself over there.
I had three potential markets in mind that I wanted to explore:
- Wood Watches
- Backpacks for the “flashpacker”
- Opportunities to import into China.
The one I was most excited about at the time were the watches.
Specifically, wooden watches.
At the time, my wife had a wooden watch before they were a thing. I’ve never seen an accessory get so many comments before. Every time she wore it at least a handful of people would comment on how unique it was.
Clearly, there was an opportunity here, since very few people were actually making these yet.
I enlisted a couple friends of mine (one of them being Nick from the video above) who knew more than I did about manufacturing and doing business in China, and headed to one of the world’s largest sourcing events: The Canton Fair.
Here you can literally find someone to make you anything you want. Diapers? Check. Sex toys? Yep. Tractors? Mmmmhmmm. Saunas? You got it.
So obviously there was a plethora of watch companies that will make you exactly what you were looking for. I even found the factory that manufactured Tate’s watch and bought a sample of essentially the same model at a 90% discount.
Well, for various reasons I decided it wasn’t the right time for me to start manufacturing. I simply had the other things that I needed to focus on more. Speaking of which, want to know more about how I almost became a Chinese import magnate?
Now, enter Ryan Beltran.
A good friend and travel companion, he also had a huge interest in watches and saw the same potential as me when we first showed up at the fair.
The difference between us?
He ran with the idea. And by ran with it, I mean, ran with it.
About a year later they launched on kickstarter and did around $400,000 – making it one of the largest fashion kickstarters ever at the time.
It’s now a massive global brand that’s worth deep into 8 figures, and has done partnerships with everyone from the Golden State Warriors to Chicago Cubs.
I couldn’t be more happy for Ryan, but well, I also realize just how much of an opportunity it really was.
I did a whole interview with him about the China manufacturing process, so be sure to go take a look at that once you’re done reading this.
How to Manufacture a Product in China: Step by Step Guide
Ok, so you want to create a physical product in China (or anywhere else)? Here’s what you need to do.
Step #1: Do Your Research
It’s one thing to have a good idea, but to actually get to the place where you can talk knowledgeably with someone about what it will take to build it, market it, and sell it, is a whole different ballgame.
Fortunately, there’s one really easy way to start this process right now.
Kickstarter and Indie-go-go: Your Research Secret Weapon
Wait, isn’t that just for selling stuff you’ve already made progress on?
And no matter what your idea is, there’s a good chance that multiple people have attempted something similar.
Kickstarter makes it a bit more difficult to see projects that have failed, but you can use a site like Kicktraq to see archived campaigns that didn’t go as well as hoped.
But the best way is to spend time browsing indiegogo, as they do keep their unfunded campaigns live via search on the site.
So for instance, if you wanted to make a new type of sunglasses, go to indiegogo, search for “sunglasses” and you’ll find a plethora of information about what’s worked and what hasn’t for others.
Research competitors using SimilarWeb
After spending time researching other products that have both succeeded and failed, the next thing to do is outline a handful of competitors or people that you’d like to try to emulate to a certain extent.
What are those brands that you think you could follow a similar path as.
It’s helpful here to look at both new upstarts, as well as more established brands out there.
So for instance, sticking with the sunglass examples you might spend some time research both Woodies Sunglasses as well as say, Ray-Ban.
SimilarWeb is a tool that allows you to dig into traffic numbers, backlinks, and get important data about where your competitors traffic, sales, and audience is coming from. We also recommend SEMrush.
There are also other SEO tools out there that can help you do similar things that range from very expensive, to free.
You may find that you don’t need to actually create your own products, that that you’d rather resell products that are already out there. This guide on How to Build an Amazon FBA Business shows you exactly how to do that.
Step #2: How to Find a Factory in China
Ok so once you’ve done your research and you have a good sense of what product you want to create, what pitfalls you want to avoid, and you’re ready to talk to someone about how to make it – then it’s time to start dipping your toes into the manufacturing world.
Should I use AliBaba to find a factory?
Chances are if you’ve done any research on how to find a factory in China, you’ve come across Alibaba. Alibaba is the largest website and marketplace out there that connects founders and factories.
Now here’s the deal, Alibaba can be a good starting point, but it’s not the be all end all, and you should proceed with caution.
First off, remember that many of these factories are getting dozens of requests a day and they’re trying to sift out who is the real deal, and who isn’t.
If you reach out to 30-40 factories, chances are only a few of them have the potential to be a good fit for you.
Also, the more detailed information you can provide to them, the better.
So you don’t want to just reach out and say “I have an idea…” and then expect them to do all the work.
As best you can, after your research phase map out what you want your product to look like. Some things to consider:
- What is the product?
- What unique features does it have?
- Can you make a prototype example?
- Can you create drawings, or even better CAD examples of what you want?
- Do you have a budget and price point in mind?
- What are similar products you can use as a frame of reference?
The more of these questions you have answers to, the easier it will be to have a good conversation with these factories.
For more information on this process check out: How to Find High Quality Suppliers on AliBaba
Attending The Canton Fair
If Alibaba is the easiest way to begin researching factories, then Canton Fair that I mentioned above is the best option.
Because you have nearly every factory in China conglomerating in one place where you an go, see hands on samples, and talk to someone in person.
That is way easier than trading emails with a bunch of foreign factories, especially if you’re still not entirely clear on what your product is going to look like in the end.
Sure it will cost you a few thousand dollars to fly to China, stay in a hotel and go through that process, but if you’re serious about building a real physical product, it’s both time and money well spent.
The Canton Fair happens twice per year in April and October and it runs for three weeks each time. Be aware however, that during each session there are different factories specializing in different products for each of the three weeks.
Here are the Canton Fair dates for this year. Just click each phase to get full details about which industries will be at each one.
Fortunately, outside of hotel and flight expenses, attending the fair itself won’t cost you a ton of money. It costs around $15 to enter, and you’re in Guangzhou China, so good food can be found on the cheap as well.
Factories in China vs. Factories in Other Countries
So nearly all of my experience is with China, but if you look at the labels of your clothes, electronics, or many other items in your house, you’ll find that they’re manufactured all over Asia.
So is China the best place to manufacture a product?
The short answer, for someone just starting out, is yes.
Well since the 1980s, China has literally been built for manufacturing. While to a certain extent it’s still the wild, wild west, the reality is that China has infrastructure that many other developing companies don’t have.
So while, major corporations can invest resources to other places like India or Bangladesh to get their expenses down, China has the best infrastructure, processes, and quality for the new founder.
And there’s nothing quite like the Canton Fair anywhere else, so that right there is the ultimate resource for your new business.
Will a Factory Steal My Idea?
The most common thing you see with new entrepreneurs both when it comes to talking to factories and telling people about their idea is that people are afraid of getting their idea stolen.
To put it bluntly: If a factory (or anyone else) steals your idea, then they’re a better entrepreneur than you. Or at the very least, they had more motivation than you.
While a factory might be great at making a product, one thing they can’t do well is build the brand and sell that product in the same way that you can.
An idea is just an idea until you begin to take significant action on it.
I had a great idea for wood watches. I didn’t do anything about it.
My idea meant nothing without action.
Step #3: Think About Your Marketing
Finally, once you’ve got your idea honed in, you’ve begun to make progress with the factories and manufacturing process, there’s one very important thing you need to focus on.
You can have all the products in the world, but if you don’t have a brand and you don’t know how to sell the products, then they don’t really mean a whole lot do they?
Often new founders get so bogged down in the process of making their product, that they forget to market their product.
So how do you do that? Well, there are a number of ways.
Launch a Physical Product via Crowdfunding Campaign
Heading back to the same resources we reviewed in step 1, crowdfunding can also be the best way to launch a new product or brand as well.
We often think of using crowdfunding as a way to get the money to make a product. But in many cases the founder has already put in a fair amount of their own money to get the product off the ground, and the crowdfunding is a way to drive sales and attention.
Recently, Pat Flynn and Caleb Wojcik did this expertly with the launch of the SwitchPod. They’d already created the product, and they used Kickstarter as a way to generate pre-sales, buzz, and to launch the brand.
Hint: It worked.
Create a Website and Begin Creating Content
These days it’s not always just about having a great product. There needs to be a great story and great people behind it as well.
Ryan built the Original Grain brand around the story of growing up in nature with his brother (who is also involved with the company).
Pat and Caleb talked about all the frustrations they had vlogging and how they needed to create a solution for themselves.
The sooner you can start creating a brand that tells the why of the story, and gets the potential customer involved and interested, the better.
That’s a huge component of what we teach in Hobby Hacking, and it’s one of the most crucial aspects to any new business.
On top of our course, I’d also recommend he book Building a StoryBrand to really cement the understanding of this concept in your brain.
Understand the Customer Development Process
Chances are, if you’re investing the time and money into developing a new product, you’re doing it on some level for yourself. You are the target customer.
But, without doing research and understanding the customer development process, you could very well find out that you misjudged the market and either your target customer doesn’t want your product, or that it’s in fact a different customer group altogether that is the right fit for the product.
By interviewing potential customers in your target market you’re able to get a much better handle on the needs and wants of this group. That way as you finalize the development of the product, and begin building that brand and the story – you can incorporate all of those elements into what you’re trying to sell.
Next Steps for Making a Physical Product in 2019
This post is a really solid overview for helping you to understand what you should be thinking about and how to approach the process of building your new product.
But there’s a lot to be done from here and a lot of ways to begin building this business.
Here are some of the next steps I recommend:
- Read: How to Find a High Quality Supplier on Alibaba – This goes much more into the how to of finding a supplier and factory online.
- Read: Original Grain Case Study – We did this interview in the early days of the business right after they made their first $100k on Kickststarter, so the advice is really relevant for people just getting going. And helps answer some frequently asked questions about China and launching on Kickstarter.
- Read: How to Run a Physical Product Business from Anywhere – This case study from Fred of Tortuga Backpacks goes into more depth and detail about the actual manufacturing process.
- Check out: Enter China – Members of the Enter China community sold a combined total of over $100,000,000 worth of physical products in 2018. This community is the real deal.