Step one after figuring out what your business will provide is learning how and where to source your product or products. Before we get too technical, let’s explain why where and how a product is is sourced is important for a business.
WHAT IS PRODUCT SOURCING?
The product is one of the most important aspects to a business because without it, you don’t really have a business. Product sourcing is just the place or way you get your idea into a product. There are a few ways to do this, all with different benefits and considerations.
METHOD ONE: MAKE IT YOURSELF
The first way to source products is by making it yourself. Making a product by yourself can be a very gratifying experience. You have the creative freedom to make the product exactly how you want it, but it’s also a time sink. As demand increases, the workload also increases making this model very difficult to scale. If you don’t have a lot of money, but do have time, making your product yourself is a great option. This would be a great option for a small Etsy shop.
You also won’t need much storage for this method since the products can be made on-demand based on each order. This allows for a great opportunity for customizing your product to your customer’s specific needs. By doing this you will also continue fine tuning your product as you find out more and more about your target customers needs.. Making your products by yourself is the recommended way for a young entrepreneur to get their business started.
METHOD TWO: USE AN ESTABLISHED MANUFACTURER OR WHOLESALER
“check their background and check their references”
The second way is to source products from an already established manufacturer or wholesale supplier. This is the easiest method to scale. This method is a great option after having made your own product, since you know you have something that will sell before sinking too much money into the idea. While it may be more expensive, this method will save you valuable time and you’ll still have control over your product.
Now, that being said, there is one more problem with this method and that is the risk of ending up with a bad manufacturer. For this method to be successful, you have to go out and find a proper manufacturer. Then you must ask them questions, check their background and check their references in order to ensure they are a business partner you can put your trust in.
METHOD THREE: DROP SHIPPING
The final way to source products is by becoming a Drop-shipper. You’ve probably already heard of this method with all of the media attention drop-shipping has been receiving. One thing to know, is this method is not as easy as it seems.. This method if done right is the least time consuming method since you don’t have to deal with inventory, shipping or extensive background checking. To quickly sum up how drop-shipping works, you source the product from a vendor, (Aliexpress, DHgate, DX, Banggood, etc) sell it on your store (Made on Shopfiy or WordPress+Woocommerce) then the vendor delivers the product for you to all of your customers.
This method can also cost the least if done right but it is extremely hard to do right with the long shipping times to customers and lack of control over your products.. This is not the place to teach the ins and outs of drop-shipping, you’ll have to do your own research to learn how to do this right.There is tons of free advice all over the web on how to start a drop-shipping business. Here’s a good place to start: How Much Money Do You Need to Start Dropshipping?
Now that you know some options for sourcing a product the only thing left to do is get started!