Do you have an excellent idea for a product but aren't sure how to make your vision tangible? Manufacturing your own product may be the perfect solution.
Many eCommerce businesses manufacture their products, and for a good reason. They're durable, reliable and made to last, plus they have a personalized touch that will help take your brand to the next level. If you're looking to join the thousands of entrepreneurs who've already taken the plunge, then read on.
Manufacturing a product can seem daunting, but it doesn't have to be. I'll show you how to manufacture your product with my step-by-step guide, from researching manufacturers to protecting your intellectual property once your product is finished.
Let's dive in!
How To Manufacture A Product
Image credit: ThomasNet.com
The manufacturing process may seem overwhelming at first, but don't worry—I'll break down all the steps you need to take to turn your idea into a finished product. Whether you're running a small business or a large enterprise, you can find a manufacturer that fits your needs. Be aware that it takes time, and there will be an upfront investment, but the work you put in now will benefit your company in the long term.
Let’s begin with outlining how to develop a product concept, so you can go into the process fully informed about what kind of commodity you want to design.
Brainstorm Your Product Idea
Developing a product concept is where many entrepreneurs get stuck, so begin by taking stock of where you are at with your business. Do you already have a thriving business that you want to expand with personalized products? Or are you an up-and-coming entrepreneur looking to get into the eCommerce market?
These starting points will determine what kind of product you want to manufacture. Suppose your business already has a solid brand identity. In that case, you'll want to produce something that fits with your current merchandise—for example, if you're selling beauty products, customers might be turned off if you start producing kitchenware. Ensure that what you want to manufacture will expand your revenue streams without straying from your business's specific niche.
On the other hand, if you’re just getting started, you have more freedom to explore and be creative but more legwork ahead of you. Perhaps you have a specific interest or hobby you want to capitalize on—a passion project is a fantastic place to start. However, you’ll have to ensure that you have the necessary funds to begin the production process.
Regardless of where you’re starting, make sure you've thoroughly researched the market. Look at what other businesses are already selling and popular items for a jumping-off point. You’ll also want to ask yourself the following questions:
Coming up with a product idea is just the beginning of the manufacturing process. However, it is perhaps the most crucial step—without a solid business plan, you won't be able to design a prototype, which is the next step I'll cover.
Design A Prototype
Image credit: SoFeast.com
A prototype is a model of your product, which can take the form of a sketch, 3D model, digital markup, or physical model. You can think of it as a draft of what you want to produce, which lets you have an idea of the final product before you purchase any materials or find a manufacturer. You can even use a prototype to test market demand for your vision to see how customers respond.
Prototypes allow you to prove your concept in the physical world and give you something tangible to show potential investors, business partners, retailers, and customers. If you require the necessary skills to produce a prototype, whether digitally or physically, great! However, there are other options if you want to outsource this step of the process.
Depending on the product, you can contract freelancers to design a prototype for you. You can hire prototype experts on sites like UpWork or Fiverr or search locally in your community to find the right fit.
Some manufacturers will also include this free service as part of their agreement with you, so keep an eye out for companies that will work with you on prototype development. However, always consider which option is cheapest, whether you design the prototype yourself, have a freelancer create one for you, or work with your manufacturer on the design.
Decide Between Sourcing Products Domestically Or Overseas
Once you've come up with a detailed product plan and prototype, you’re ready to find a manufacturer. There are manufacturers for nearly every type of product imaginable, which means plenty of options but also a myriad of different companies to sort through.
When looking for a manufacturing company, one of the first decisions you’ll need to make is whether you want to work with overseas manufacturers or a local manufacturer. There are pros and cons to both domestic and overseas production, so it’s crucial to understand the differences before jumping in.
If you choose an overseas manufacturer, you'll likely pay lower prices, particularly in Asian countries. Since most products are made overseas, you'll also have more businesses to choose between.
Though many types of products are more affordable when manufactured in foreign countries, they may have a lower quality level than domestically produced alternatives. Checking the quality and communicating with these businesses may also be tricky since you can't meet personally on-site with the manufacturing company. There may also be communication hurdles, like language barriers or time differences.
You'll also need to ensure your product can survive long-distance travel, especially if your manufacturer is shipping fragile or perishable goods. Luckily, production times are typically faster, even though the shipping process may take longer.
Keep in mind that some foreign manufacturers will decline your business if you don't buy in large quantities, which I will get into later when I address minimum order quantities.
Working with domestic or local manufacturers has its benefits as well—generally, your product will likely be of higher quality than those manufactured abroad. In exchange, though, the prices for production may be higher.
You'll also need to factor in longer production since domestic manufacturing services have different labor practices. However, communication will be more accessible with these companies, and you'll have a better chance of working first-hand with the companies, which can help you verify their legitimacy.
Another benefit is that domestic manufacturing companies are more likely to deal with smaller orders, as opposed to foreign manufacturers that typically prefer bulk orders.
Ultimately, you’ll have to consider the costs, shipping times, the availability of manufacturers for your specific product, and how hands-on you want to be regarding communication.
If you find the right fit, both international and domestic manufacturers can create the perfect product for you, so let’s get into how to research and compare manufacturers.
Find Manufacturers For Your Product
Image credit: FormLabs.com
Once you've decided where to source your products (overseas or domestically), it's time to start the research process. The first step is to build a list of potential suppliers who manufacture the products you seek. Below are some suggestions for shifting through the many options, from optimizing Google searches to asking reputable businesses for referrals.
Google Searches
An essential jumping-off point for market research is utilizing Google to search for manufacturers. Make sure to use keywords to optimize your results. One simple tip is to search [your product] + [manufacturer]. You can also use [supplier], [wholesale] or [distributor].
This method should provide you with a few top-ranking manufacturing companies, or at the very least, give you an idea of how many options there are for your specific product. Are you overwhelmed by the number of results? Don't worry—I have other suggestions to narrow down your search.
Online Manufacturer Directories
If you're looking to source specific products, I recommend using online manufacturer directories like Alibaba, a Chinese company, to find manufacturers willing to create your product. If you want to learn more about the company, make sure to watch my video on how to make money with Alibaba.
Alibaba is easy to use—simply click on the “Suppliers” tab on the search bar and type in what product you’re looking for. From there, you can use filters to narrow down your search. You can also check out the individual websites of the manufacturers you find to learn more about them.
Are you not sold on using an international company? If you want to search domestic registries for North America for suppliers, you can also use websites like Thomasnet or Maker’s Row.Search By NAICS Code
If you want to find a manufacturer capable of producing your product, the North American Industry Classification System (NAICS) is an excellent way to search. Most products have a unique NAICS code that you can search in the database to find suppliers of your chosen product.
Referrals
If you know anyone who has their own business, they might be able to refer you to a solid manufacturer. You can also try reaching out to companies you admire to see if they can give you some intel on what manufacturers they use or the process by which they located their chosen manufacturing partner.
Forums And Social Media
The more connections you have in related fields, the easier it will be to get valuable information. If you don't have an existing network, though, luckily, there is a solution that can quickly provide you with tips and tricks—forums and social media.
You can join Facebook groups for eCommerce entrepreneurs, or use forums like the Digital Point eCommerce Forum and BigCommerce Forums.
Hopefully, these suggestions provide a solid foundation to start your search. If you need some additional guidance, head over to my article on how to find high-quality manufacturers. In the next section, I will explore how to choose a reputable manufacturer.Verify The Quality Of Manufacturing Companies
Image credit: Go-bluestreak.com
Once you’ve compiled a list of multiple manufacturers you may want to work with, checking their legitimacy is crucial. The last thing you want is to invest in a poorly made product that will force you to go back to the drawing board and start again.
Finding suppliers can be difficult, but you can implement a few methods into your research plan to ensure that you are working with top manufacturers at the best price.
Compare Prices
An easy way to separate solid manufacturers from less reputable suppliers is to look at their prices. If they are too good to be true, that probably means there are some quality issues— you can't expect a high-quality product if the manufacturer is cutting corners on the materials and employees' wages.
Comparing the prices of multiple suppliers is crucial to figuring out a ballpark range that is the norm for the product you want to manufacture. The more research you do, the better idea you’ll have of what a realistic price range is for a manufacturing service.
Get Quotes From Multiple Sources
Pricing varies widely depending on which country the parts are manufactured. How much customization is required for your product may also increase fees. Once you have a firm grasp on all the typical costs for your product, talk to as many manufacturers as possible and request quotes. Don’t be afraid to ask questions— manufacturers who pride themselves on good customer service will be happy to walk you through the process. After all, if you're going to invest a lot of time and money into this product, it's important that you end up with something you love.
It is essential that you talk to a few manufacturers before finalizing any deals. Discuss the fees and payment terms for the process, too. Here are some questions you can ask:
Read Reviews
You can read reviews to get insight into other customers' experiences with a supplier or manufacturer. Be cautious with companies that don't have many (or any) reviews. You'll want to know they've been around long enough to build up the clientele and reputation necessary for success for your peace of mind.
While there may be rave reviews on a company's website that they highlight, you should also use Google to cross-reference these reviews. There, you can find specific product reviews and general complaints about suppliers and manufacturers.
Check With The Better Business Bureau
The Better Business Bureau is a valuable source to find information about potential manufacturers—they provide ratings based on customer reviews, so you'll be able to see which companies are reliable. If a company has an A+ rating, you're in good hands! Keep in mind that if a company has multiple complaints but responds to them all and makes things right, their rating will go up.
Order Samples
Most reputable manufacturers will offer free product samples so you can see the quality for yourself before making a decision. Getting a sample of your product is critical because you may not be around to check the company’s workmanship, especially if you’re using an overseas manufacturer.
Be wary of manufacturers who use cheap materials or rush through the process—these factors could lead to a product that doesn't last very long and damages your brand's reputation.
Even if the company doesn't offer to send a free sample, request or pay for one to ensure that the materials they are producing are up to your standards. Paying extra costs is worth it to ensure they have a reliable production line, fair shipping costs, and quality products.
Visit Your Manufacturer
If possible, you should request a trip to your manufacturer's location to make sure they're a reputable business. Unfortunately, plenty of knock-off factories will send cheap, low-quality products. Verifying their legitimacy in person and building a good working relationship will help you feel more confident if you're in the process of selecting between a few manufacturers.
Set Your Terms
Image credit: singhania.in
The negotiation process is highly dependent on what you're manufacturing and which company you choose to hire. If you're working with an established company, most manufacturers will have their own terms and conditions already set.
Regardless of their policies, you should still advocate for yourself—by knowing the potential manufacturing costs ahead of time, negotiating order qualities, and protecting your intellectual property. Let’s take a look at how you can set your own terms.
Estimate Manufacturing Costs
Before you communicate with your supplier, you should have an idea of the amount of money you are able (and willing) to spend. When determining manufacturing costs, there are a few fees to take into account.
Taking these manufacturing costs into account, try to make a plan for how much your expenditure will cost. That way, you'll be able to meet with your manufacturer informed and ready to negotiate. The company's fees may vary, so it's best to ask the manufacturers about their fees upfront, but estimating the expenses and knowing the different costs to account for will help you be more prepared.
Negotiate Minimum Order Quantities
A minimum order quantity (MOQ) is the fewest units of products that a company will let you purchase to place an order. For example, a clothing manufacturer may have an MOQ of 1,000 units, which would mean you have to pay for 1,000 pieces in that style.
It's essential to negotiate with your manufacturing company and make sure that they can meet your minimum order quantities while upholding quality standards. Once you have an estimated price for your product, you need to find the sweet spot between purchasing too few units or being forced to pay higher prices due to rush orders if you run out of inventory.
The MOQ standard will depend on what industry you’re operating in and the company’s production process. Generally, the lowest MOQ would be fewer than 250 units, while the highest end is around 2,000 to 5,000 units. However, there's always room to negotiate— check out what other customers are doing and see if you can get a better price by altering your order quantity.
Protect Your Intellectual Property
If you’ve created a unique prototype or design, protecting your intellectual property is crucial. If you’re working with a U.S. manufacturer, you can patent your product through the United States Patent and Trademark Office.
If you’re working with an overseas supplier, make sure to add some terms and conditions that ensure the rights to your product's design. That way, nothing will be reproduced without your permission.
What Is A Manufacturer?
Image credit: Weidert.com
A manufacturer is generally a business that makes products from raw materials using machines and equipment. Manufacturers may produce goods locally, regionally, or globally that they then sell to consumers and retailers.
A manufacturer's role varies on a case-by-case basis, depending on their client's needs. In general, manufacturers do the following:
As you can see, manufacturers encompass many roles that will fit all of your needs, whether you want to design a unique product or purchase a pre-made prototype. In the next section, I’ll review the different types of manufacturers so you can find the right fit for your business.
Types Of Manufacturers
There are a few different kinds of manufacturers you can work with, from trading companies to mass production factories. Here’s an overview of the different types, including their manufacturing process.
Factories
Factories are manufacturing facilities that may be either privately or publicly owned. Factories typically strive to create the highest volume of products at the lowest price by mass-producing similar items.
If you source from a factory, you will pay a lower price, but they typically have a higher minimum order quantity (MOQ) and a smaller variety of products.
Trading Companies
A trading company is a business that doesn't manufacture products but instead sources them from various factories. As a result, they offer a wide array of products. Trading companies act as a middleman between the factory and the buyer.
Sourcing from trading companies can be more expensive, but they have more quality control than factories, a more extensive list of products, and lower MOQs.
Wholesalers
Wholesalers and distributors buy products from manufacturers in bulk quantities and sell them to retailers or other businesses. They may receive special discounts when they purchase in volume. Some wholesalers and distributors also provide services such as warehousing, storage, and arranging shipments for the products they distribute.
Now that you have an understanding of the main places to source your product, let’s take a look at why you should manufacture your products.
Why Should I Manufacture A Product?
When you manufacture your products, you have complete control over all aspects, from design to branding. This process allows you to create high-value products with unique characteristics that fit your business needs.
You'll also have the ability to be innovative, which allows you to stand out against your competition and produce unique products that set you apart from everyone else in the market. Creating your own product means that you'll own a valuable asset unique to your business if the product is successful.
However, you'll need to take extra care to ensure that your product is high-quality since your brand's reputation is built on product quality and positive customer experiences. It takes years and a significant amount of money and resources to develop trust amongst your target market. When you manufacture your products, you increase the probability of building long-term relationships with your customers—but only if they are happy with the items.
How To Manufacture A Product—FAQ
The costs of manufacturing a product may vary widely depending on what kind of goods you plan to produce. To calculate the total fees, consider the following:
Manufacturing a product can be a lengthy process, but here are my suggestions for breaking down the steps:
Final Thoughts
Image credit: Twi-Global.com
Deciding to manufacture your own products is a big decision, but it can be an incredibly rewarding experience with the proper planning and preparation. You'll have more control over your products, brand, and ultimately your business, as well as high-quality goods.
We hope this guide has helped give you some insight into the process and shown you that it's not as daunting as it may seem. Now it's time for you to take the next step and start manufacturing your own product! Follow these steps, and you'll be on your way to bringing your invention to market.
