Sunday, May 31, 2015

How Many Suppliers to Recruit?

On May 29, 2015, at 9:52 AM, LA wrote:


Thank you for being so patient with my questions last class.

Here is yet another one:  Is this hypothesis a good one to test?

I have found 130 specialty suppliers of higher end (product), any of whom could be argued to be best in the world.  

From those 130 I have discovered 5 make their (product) in a special way.  It's with an open type of (ingredient) that was used prior to 1970.

These 5 are the only makers who still make their (product) this way and it is loved by some enthusiasts.  

I was going to contact all 130 (using your methods) but especially focus on the 5 traditional makers and get a MOQ from one of those 5.  Then see if in Japan
and Korea (Top 2 export markets now) there is interest in this special type of (product).

Is this correct?

Thank you for such a great class.  It really has been wonderful.


Hey LA,

Contacting 130 is waaaay too much work...

But you do have a hypothesis to test....

"the special process product will find market overseas..."

Contact the five serially, not all at once... (ignore the other 125, small business is specialty, the five are specialty, the 125 are price competitors).

Work through the five and discover which one (if any) will support your export program by committing to shipping any lcl moq fob test sale you contract AND not go around you...    (NEVER gain an exclusive....  work with those truly uninterested in exports)

Now..say one and two will not agree...  three is just too loopy to work with... and 4 agrees...  very good...

For now, ignore five...  work with four...

What do you know?  1 and 2 may compete with you... three cannot... four will work with you.. 5 is unknown...  That is good enough to proceed with a test of the hypothesis.  Big lesson to learn: although we start with hard-core solid research for rationale and direction, we switch to customer contact soonest.  We don't worry about competitors or the unknown, we start developing our own "known" with whatever path opens.  Perfect is the enemy of the good, having a supplier is good enough to start without worrying about anything else.

Create your offer: the lcl moq fob for your product, and in fact, your "product" is your lcl moq fob.

Now, the #1 reason for failure is always when the start-up says "yes" to a customer...  (I see your LCL MOQ FOB, will you make a change?  "Yes!  Failure is then guaranteed.)

You only make a change to your lcl moq fob after about 75 customers make the exact same complaint (and only if that complaint is valid)  (of course EVERY buyer will say your prices are too high, but that complaint is never valid in business.)

So your offer is special (product)...  you tool is the lcl moq fob colby...  you test the hypothesis by means I outline... you watch the other five as you find customers....  they will be contacted BECAUSE you interest people overseas....

At which point you then "prove your company" in the sales process...  by showing why everyone should buy from you...  this is a separate issue for you to be working on as you develop your lcl mog fob...

so far so good?


Feel free to forward this by email to three of your friends.


Anonymous said...

John, I know you are against exclusives in international trade.

But what if the supplier offers the exporter an exclusive instead of the exporter asking him for one?

Shouldn´t the exporter take it as it is offered by the supplier himself?

and if the exporter takes it. How can it become a disadavantage?


John Wiley Spiers said...

Your business is the customer list, and how you serve them. Suppliers are suppliers, changeable. Exclusives are two-way swords, done fairly they tie me up as much as the other side. No thanks. Customers first, that value in business is the relationships with customers.