In this latest episode of Selling on Giants, we had the pleasure of speaking with Sebastian Hertz, the co-founder of Zignify Global Product Sourcing. With a background in electrical engineering and industrial automation, and over a decade of experience living and working in Asia, Sebastian has a deep understanding of global markets, product sourcing, and cost optimization. Since launching his Amazon business in 2014, Sebastian has honed his expertise in finding the best suppliers, building strong relationships, and saving millions for his clients by optimizing product sourcing and reducing costs.
In this episode, Sebastian also shared the story of his 38,000-kilometer journey from Singapore to Germany on a motorcycle with his wife, Yulia, all while managing his business on the road. His unique perspective and approach to eCommerce offer invaluable insights for anyone looking to improve their sourcing and supplier management processes.
Key Takeaways:
Key Insights on Sourcing and Negotiation
- Successful product sourcing requires obtaining multiple quotes to leverage negotiation power.
- Quality control is essential for both samples and mass production, particularly when working with new suppliers.
- It’s critical to approach suppliers with the understanding that you’re not merely purchasing; rather, you are also selling yourself and your business potential to them.
- Persistence is key in establishing successful supplier relationships and achieving better outcomes.
- The willingness to tap into alternative markets for existing products can create significant opportunities for cost savings.
Sourcing Strategies
- When sourcing products, prioritize finding around 30 potential suppliers in China; more if sourcing from outside China to increase options.
- Avoid trading companies to reduce unnecessary costs and increase profit margins.
- Engaging directly with manufacturers can provide better prices and terms.
- Always present a positive but realistic outlook to potential suppliers about future orders to build trust.
- Patience is vital throughout the negotiation and sourcing process; expect multiple communications before receiving favorable quotes.
The Importance of Resourcing Existing Products
- Continuous improvement in sourcing established products is critical for profit optimization.
- Resourcing can involve finding alternative manufacturers or countries that can offer lower costs without compromising quality.
- Example: A client saved significant amounts by shifting suppliers from China to Vietnam, eliminating anti-dumping tariffs while obtaining lower product costs.
- It’s beneficial to reassess suppliers regularly for potential price reductions, even after initial orders.
- Successful resourcing can lead to increased profitability which can then be reinvested into marketing and sales initiatives.
Nurturing Supplier Relationships
- Building strong supplier relationships can be facilitated by placing consistent orders and communicating effectively.
- Establishing trust and reliability with suppliers can lead to better terms and pricing over time.
- Stay proactive in negotiations and manage expectations from both sides to foster a lasting partnership.
- Healthy supplier relationship is mutually beneficial, as suppliers prefer working with businesses that demonstrate commitment and reliability.
- Regular check-ins and clear communication channels can strengthen the relationship and encourage a collaborative approach to problem-solving.
Inspirational Message
- The conversation reflects the importance of pursuing dreams, taking calculated risks, and embracing opportunities in business and life.
- There’s immense potential for travel and work balance, as exhibited by his wife who managed to sustain employment while traveling extensively.
- Encouragement to show patience and tenacity resonates throughout the discussion, highlighting that success often requires perseverance against challenges.
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Links:
- LinkedIn – Personal: https://www.linkedin.com/in/sebastianherz/
- Branded – Linkedin: https://zignify.net/
“Selling on Giants: The eCommerce Marketplace Show” is sponsored by BellaVix. To learn more, head over to https://sellingongiants.com/
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