last week I needed to make a critical design change for one of our products now with our Chinese supplier this would have meant weeks of back and forth emails midnight Zoom calls and a 3-month delay in production instead I hopped on Zoom with my us supplier sat down with the designer and had an approved prototype in my hands 72 hours later that moment hit me like a thunderbolt for 10 years I'd accepted the headaches of overseas manufacturing as just the cost of doing business the midnight calls the communication barriers the endless weight times the shipping
containers stuck in ports I thought this was just how manufacturing worked in the modern world but I was wrong what I'm about to share with you today isn't a story about saving pennies per unit instead I'm going to share how moving our manufacturing back to the US for one of our product lines transformed our ability to innovate and quickly respond to Market changes instead of waiting weeks for samples to cross the ocean I now get prototypes the same week need to adjust production quantities rather than being locked into massive minimum orders I now have the
flexibility to buy just enough to match my actual demand have a quality concern instead of trying to explain issues through translated emails I can quickly hop on a short plane ride and solve the problem face to face in this video I break down exactly how switching to a US supplier eliminated stress from my life you'll see real examples of how closer collaboration and faster turnaround times didn't just reduce our headaches they made my mental health a a heck of a lot better if you're currently Manufacturing in Asia in lower quantities what I'm about to share
might completely change how you think about your supply chain this isn't about patriotism or politics it's about removing the invisible barriers that are holding your business back so let's dive into what really happens when you can actually talk to your manufacturer now if this is your first time visiting my channel I run a seven figure e-commerce store over at Bumble lens.com and in this shop we primarily sell personalized handkerchiefs for special occasions but about seven years ago we decided to start selling our own custom line of motherdaughter aprons and this is where the troubles began
now when you're selling standardized Square pieces of fabric like our handkerchiefs Chinese manufacturing makes perfect sense the product isn't complicated the communication is easy the prices work and the process is predictable but for any product that requires frequent communication sizing adjustments and quick turnaround times that overseas price Advantage quickly disappears under an avalanche of hidden costs and headaches for one thing Asian sizes always run significantly smaller than us sizes in Asian large might be a us small and I'm not even exaggerating here as a result if you make any article of clothing in China you
have to provide exact measurements otherwise you'll end up trying to sell kid-size clothing to adults now the main reason why people import from China is because of the low prices and yes in almost all cases products made in China will be cheaper than in the United States because the cost of Labor over there is about 4X less however recent events have made the cost Gap less appealing than it once was if there's a change in leadership we can expect even more shifts now if you've been following the news you know the US has been in
an ongoing trade war with China for the past several years back when Trump first took office he introduced a set of tariffs that covered roughly 40% of All Imports into the US from China and in retaliation China followed suit by imposing counter tariffs on a wide range of us Goods particularly targeting high value exports like soybeans Automobiles and chemicals and this has hurt us farmers and industries relying on Chinese demand and for Amazon FBA and e-commerce sellers like you and me this trade War has driven up the prices of goods from China significantly over the
years meanwhile there are a ton of disadvantages to importing from China versus sourcing from the US or wherever you live for one thing the lead times are significantly worse and the cost savings aren't as much as you might think once you run the numbers and account for cash flow for example every production run that we make in China takes around three months then it takes another full month to have our Goods shipped over by boat and to clear Customs so let's just call it four months total now hypothetically speaking let's say you sell your products
on Amazon and you sell 10 units a day and your stuff costs around $5 per widget in those 4 months you are selling 1,200 units while you are waiting for your next shipment that means that you need to buy at least double the units or 2400 units up front otherwise you'll run out of stock before you get a chance to order again buying 2400 units means that you need to front $300 * 5 * 4 months * 2 which equals $112,000 and $12,000 is a hell of a lot of money to float for 4 months
meanwhile if you have your stuff made in the US the lead times might be only 2 weeks or 14 days using the same example you would sell 140 units during those 14 days days which would cost you $700 so by sourcing in the US you would only need to front $1,400 in inventory to make sure you don't go out of stock that's only $1,400 versus $112,000 which is a huge deal when it comes to cash flow and it greatly mitigates your risk after all what if something were to happen where demand suddenly plummets like it
did during the pandemic what if there's a catastrophic defect in the $122,000 worth of inventory you just bought from China well you're out of luck even though the unit price in the US might be more expensive chances are you'll have to front less money and buy less but either way you have to do the math to see if it makes sense by the way if you're interested in learning how to start your own profitable online store make sure you take my free 6-day e-commerce mini course below it's very thorough and I guarantee you'll learn a
lot plus it's free the other benefit of buying locally is that the minimum order quantities are much less typically when we buy aprons from China we have to buy at least 500 units per style per size and to put that number into perspective let's say you sell five different styles of aprons with three sizes each that's 15 * 500 equals 7500 units you have to buy up front and that's a lot when you're first starting out and you have no idea how many you can sell meanwhile when sourcing from the US you can get by
with small production runs of 50 or 100 units The Upfront monetary risk is far less with the US supplier and then there's the communication Factor I've been importing from China for 17 years now and whenever we work with a brand new vendor there is always some sort of communication problem we've had suppliers who seemed attentive during lengthy Zoom calls listening carefully and asking questions only to turn around and produce our products as if that entire conversation never happened this is why when I teach my class over at profitable onlin store.com I teach my students to
be super anal and document everything in writing whenever I get a sample I document the hell out of it and specify every minute detail of the product Because unless you document everything your production run may not even resemble the sample you just ordered one time we were negotiating down prices with a supplier that we'd worked with for 5 years we literally bought tens of thousands of the exact same handkerchiefs and since our order volumes had steadily increased I asked for a price break our supplier agreed without a fuss and I thought everything was good until
they shipped us the thinnest handkerchiefs that I'd ever seen basically because we didn't document in writing that we wanted the same quality handkerchiefs as before they cut Corners to meet our price point in the 17 years I've been doing this I have tons of stories like this you have to be super specific and exact with your communication with the Chinese supplier otherwise you'll never get what you expect now let me switch gears now and share my recent experience producing our motherdaughter aprons here in the US and hands down the toughest part of us manufacturing is
finding the right supplier and ultimately I decided to work with a company called she makes products led by a net delay now if you're considering making a textile product in the US I highly recommend inet services but let me highlight the Stark difference between working with her in a typical Chinese vendor and it was truly night and day for starters being in the same time zone meant no more late night calls or delayed communication I could text anet anytime during the day and get an immediate response so we kicked off our project in January and
to give you some context on our usual process we don't use an apron pattern or Source our own fabric instead we work with our Chinese supplier on the design and choose from the Fabrics they have available so we approached Annette with almost nothing to start with and she began by reviewing our existing products and sending over various fabric swatches for us to choose from and then we sent over one of our current aprons which she deconstructed to create a pattern now it took us about 2 to 3 weeks to sett on fabrics and the whole
process was straightforward we simply exchanged messages on WhatsApp and had a couple of Zoom calls to finalize the details and here here's where the experience really stood apart typically when working with a Chinese vendor the burden is on you to ensure everything is correct and that it meets your specifications and you have to be extremely detail oriented but with Annette she understood our requirements right from the start and offered valuable suggestions along the way she even went ahead and created mockups of our care labels only asking us for final approval and once everything was approved
production just took 2 weeks compared to the usual 3 months and since she's based in California shipping was fast and affordable and the best part is that we could order as few as 50 units unlike our previous minimums of 500 units per style and size so the speed of production coupled with the speed of communication and low minimum order quantities now allows us to iterate quickly and get new designs out on the market fast without a huge upfront cost of inventory and because the communication is tight and the factories in California we can easily make
changes on a dime for example the first apron sample that we received was a little thin so we asked to have a liner sewn on top of it to make it thicker easy and during that product review we also decideed to lengthen the straps to reduce the number of sizes required and within one conversation we had a prototype that improved on the original design try coordinating that kind of Rapid Innovation with a factory on the other side of the world and the benefits also go Way Beyond speed remember those midnight WeChat conversations about measurements that
I mentioned earlier in the video gone there's lengthy email thread trying to explain exactly where a pocket need to be repositioned replaced by a quick Zoom call with the designer in perfect English the impact on our business has been great because we now have the confidence to explore different patterns with very little risk our custom apron line which used to be our biggest headache is now a big potential growth lever for our company why because we can now say yes to opportunities that used to be impossible Rush orders for a restaurant opening no problem mid-
production design adjustments yeah yeah small batch sizes for testing new styles for sure and custom size modifications a twoe turnaround time think about it how many opportunities are you missing because your minimum orders are too high how many customers are you turning away because your lead times are too long and how many Innovations never happen because the back and forth with your factory is too cumbersome now I'm not saying you should move all of your production to the us we certainly haven't but for our custom apron line making the switch wasn't just about Improv in
efficiency it has changed what we can offer our customers now you're probably wondering about the cost and this is the biggest disadvantage working with the supplier in the United States cost us about 3x the cost of China but we have to float over 10x less money upfront and we can iterate on a dime that's why I always recommend that my students avoid Manufacturing in China at first until they have sufficient volume especially in today's political climate it makes sense to diversify away from China and place the good old made in the USA label on your
products now that you understand some of the trade-offs of sourcing from China versus the US make sure you watch this video here for a list of wholesale suppliers in the United States and if you want to work with an net I've left a link in the description below
