Million Dollar Case Study: Europe - Session #10 - Amazon Supplier Agreements

SESSION 3:

Supplier Outreach & Product Selection

T H E M I L L I O N D O L L A R C A S E S T U D Y

E U R O P E

Our Progress

◍Found a product & verified it◍Found suitable suppliers◍Decided on product specification◍Ordered and reviewed samples◍Setting up VAT & EORI◍Product branding decisions◍Set up a seller central account & a

product listing◍Worked with a freight forwarder for

quotes on shipping

Today we will cover

Ordering Inventory & Procurement, including:

◍Ensuring ALL features are included in final quoted cost

◍Final negotiations ◍Deposits◍Contracts and Agreements◍Payment terms◍Creating a shipment in Seller Central

Back to Product Specifications

Recap Session #5: junglescout.com/blog/product-design-specifications

Final Negotiations

Supplier 1 Supplier 2 Supplier 3

Overall Very good attention to detail and easy to work with, not moving on price

Friendly, easy to work with, eager to make product improvements

Friendly but with slow response times and samples

Product Quality Highest quality sample, with nice features

Good quality, needed some improvements

Samples took too long & negotiations already started

Price Some additional costs for requested features which have made this supplier more expensive

Cheapest price quoted Good prices but without additional features

Lead Time 25-30 days 35 days 30 days

Communication 9/10 Very good English, speaks on Skype daily, asks lots of questions & has ideas about the best types of fabrics & what certificates are usually required

8/10 Good English, takes slightly longer to understand requests but very eager

5/10 Good english but with slower responses

Packaging & Printing Requirements

◍ Figure out what packaging, labels or inserts you need now

◍ Ensure your final quoted price includes everything you think you will need

◍ Avoid the suppliers adding on costs later down the line

◍ Add all of your specifications to the purchase order contract (more on this later)

Recap Session #7: junglescout.com/blog/amazon-product-branding

Negotiation Tips

● Ask for prices at different MOQ’s and then meet in the middle. E.G, “you quoted $7.50 for 2000pcs, can you do $8 for 1500 for the first order”

● Play up your buying power in the future. E.G. “This is just the trial order to sell in the UK, after that I intend to order inventory for the US and other European countries”

● Find out if using a different type of packaging would make bring the cost down (i.e. a white bag instead of color)

● Ask to price match a cheaper alternative. E.G “I enjoy working with you, however, all our other factories are offering pricing in the $7.00-$8.30 range for the same spec sheet. Would you be able to get your pricing down to that range? If not, I unfortunately will have to go with one of the other factories.”

Deposits & Payments

Payment terms:◍Always try to get 50/50 or 30/70 deposit and

then full payment when goods are ready◍Build this into the purchase order contract

Payment method:◍Pay by T/T, wire transfer

Purchase Order: Contracts & Agreements

Build a purchase order contract that includes:

◍Full product spec◍Costs◍Production time agreed by both parties◍Inspections & processes for defects◍Packaging and labelling required◍Shipping agreement◍Confidentiality agreement

Purchase Order Agreement

Let’s take a look at a working example

Create A Shipment Plan

Other Requirements Once Inventory is Ordered

◍Send in logo designs◍Packaging labels or insert designs◍Label contents (wording)◍Information from your freight forwarder

Branding & Design Recap Session #7

Shipping & Freight Forwarding Recap Session #9

junglescout.com/million

Keep in Touch

◍Lay out what you expect from your supplier in your agreement

◍Communicate frequently to ask for updates and photos as agreed

◍If there are any issues or delays, try to jump on a Skype call to get a fast & honest response

Follow Along: Your Homework

1. Place your deposit & get that inventory ordered

2. Ensure you have negotiated the best prices and the most mutually beneficial contracts & agreements

3. Continue to keep constant contact with your chosen supplier throughout the manufacturing process, ask for photos and updates frequently!

Get all of the resources and links from this session: https://www.junglescout.com/session10-HW

Join Us Next WeekJoin us next week for an exclusive MDCS Europe Q&A session

with Greg – questions are NOW OPEN!

Register for FREE at junglescout.com/million