By Gary Huang, Founder of 80/20 Sourcing.
Every year as the seasons change and as we enter spring and fall, something big happens. Do you know what that is? Besides better weather, it’s trade show season!
But you might be asking why trade shows? Aren’t they drying up when you can find suppliers online?
Well, my question is, do you want to own a 7-figure Amazon business?
FACT: according to a 2016 survey by webretailer.com, multimillion dollar Amazon sellers are more than twice as likely to attend trade shows than non-multimillion dollar sellers.
What does this mean for Amazon sellers? Is it a matter of simply showing up at the Canton Fair and finding the right supplier right away?
It’s not so easy – you have to know how to ask the right questions to find the right product at the right price for your business.
This guide is going to walk you through how to attend a trade show like a true pro, with bonus material at the end if you can't fly to Asia for Canton Fair. I've got it all covered!
Let’s take a step back first. You may have heard of the 80/20 Rule or Pareto’s Principle,
“The law of the essential few and trivial many”
In terms of sourcing: 80% of suppliers out there are NOT the right fit for you. Your job is to find the right 20% and focus on those! Let's call them the yes suppliers for the purpose of this article.
Once you have a grasp of the the 80/20 rule, now let’s apply it to trade show sourcing so you can learn how to focus the most important things to do before the show, during the show, and after the show.
Savvy Amazon FBA sellers know that just as there’s “more than one way to skin a cat” there's more than one way to find a Chinese supplier to source their product from. So besides using sites such as Alibaba, trade shows can be a great way to:
Imagine all the time you save speaking with someone in person and being able to hold the sample product in your hands rather than the daunting process of emailing back forth every night trying to figure out if this is a reliable supplier and then getting a sample delivered to you. I wrote an article earlier which outlines the benefits of attending trade fairs so I won't get into too much detail here why you should go.
Before you hop on a plane to China, do yourself a favor and take 20 minutes to prepare to save time and headaches so you can maximize your trip.
You will meet a ton of suppliers at the fair. And you will forget who’s who. That's human nature. So to make the most of your visit, your goal should be to organize this information so you can recall it when you follow up after the fair.
Here’s the system I use which is a hybrid of old school note-taking and high-tech smartphone tactics.
Here's my everyday carry:
Think of yourself interviewing for a job. Just as a hiring manager vets their applicants, suppliers will vet and even GRADE their prospective buyers! How do you make yourself into a “Grade A” buyer in their eyes?
To make a good impression and to get a supplier to notice you, first put yourself in their shoes. Suppliers would love to get a huge order from a Target or Walmart and traditionally they didn't pay much attention to small volume buyers selling online. To them you’re a nobody (so far!).
However times are changing and with the global economic slowdown as well as the explosive growth of e-commerce recently, they may be willing to listen to you if you play your cards right. So how do you persuade them to pay attention to you?
To make a good impression with a supplier, first put yourself in their shoes.
Before we start when meeting suppliers first make sure they can supply the product you need. Do this by simply asking. If not, move on. If they can, begin by introducing your company, which market you sell in, and products you’re interested in.
Some key takeaways are that you need to demonstrate your experience, your ability to buy, and potential. No need to get into too much detail but just enough to hook them and get them to start telling you more about their product and company.
I call this system EPAC: Experience, Products, Ability to buy, and Call to action.
EPAC in more detail:
Hook a potential supplier with the EPAC System: Experience, Products, Ability to buy, and Call-to-Action.
Finally as a bonus think of the value you can bring them!
What’s in it for them? Listen to what they say and find a need you can fill. For example which markets do they export to? Maybe they would love to get into your market.
One supplier I met recently at a trade fair tells me they have competitors who sell to the US and on Amazon. They are not there yet and they would love to get in which I can help them do. So they are willing to offer me better pricing. Think about their needs, fill them, and bam – you're in! It's not an essential but it adds to their impression of you if you can offer them value beyond just the order.
Keep in mind that for Chinese suppliers, English is their second language. Imagine if you had to speak to them in Mandarin Chinese! It's not easy so it will require a different set of vocabulary than talking to your friends or colleagues. I like to think of it as explaining your business to your grandmother: simple language, slowly, and with a smile.
The 3 S's of communicating with Chinese suppliers:
When preparing for a trade show, remember the 80/20 rule:
By now you’ve already pre-registered for the show and reviewed the map so you know which halls to target. This means you will hit the ground running.
Let's apply the 80/20 rule here. At the show your goals are these:
In other words “80/20” the suppliers and don’t waste time on the trivial many. Trade shows are huge. When I visit one, sometimes I walk 20,000 steps a day!
I find that trade shows are a lot like speed dating events.
In fact, it’s a “Meet Market” and just like one of these networking events, you’re not going to talk to everyone. Use your eyes to see which suppliers may be the right fit for you before you approach them. Do they have the right product I’m looking for? If not move on.
There are dozens of other suppliers that can be Mr. or Ms. Right so keep moving until you find them. As I’m doing this, I keep in my head 3 buckets: “YES, NO, and MAYBE”. I ask myself “Where will I put them?”
As we have already highlighted, before I get into asking questions, I prepare a short elevator speech to introduce myself, my business, and marketplace, and then a call to action where I will ask them questions. Many first time trade show goers forget about this step.
But a proper introduction will build confidence and make suppliers more comfortable in doing business with you. This can even persuade suppliers to reveal products not on the trade floor, lower prices, and a greater incentive to do business with you.
By now you might be thinking, “This is great, but how do you capture this information?”
Well, here’s my process using the tools I mentioned earlier.
Remember to make a note of the suppliers booth number, take lots of pictures and note your thoughts on the next steps.
I’m not perfect, here are some mistakes to avoid that I’ve made over the years attending trade shows.
Once you’ve seen the entire show, leave and get a well-deserved rest.
But wait – you’re not done yet. You need to filter through the contacts you’ve made and follow up.
After the show I will have a ton of business cards, notes, and catalogs. I will divide them into 3 stacks:
YES: For Follow Up
NO: For the trash
MAYBE: Keep in case you need backup suppliers or potential products later.
So how do I manage all the emails after the show? I create a spreadsheet with the YES suppliers and their contact information, reference quotation, notes, and next steps. Then I follow up with an email template that I copy and paste. In the subject line I include their company name and product so I can quickly recognize who’s who.
Best practice: Never give them your primary email address! I create a separate email address for sourcing. Be prepared for a lifetime of Happy New Years, Merry Christmases, and endless supply of spam.
The follow up email will address these essential points leading up to a trial order:
Create a seperate email address for trade show follow-ups so you don't get lots of spam to your main email.
Here are some tricks of the trade that will get you ahead of your competitors who also attended the trade show:
Remember you’re at work and a good trade show can be priceless. With these tactics you will be on your way to finding the right suppliers and products at trade fairs so you can own that 7-figure business!
Going to the Canton Fair or trade shows in Hong Kong is great but what if you can’t fly to Asia? What if you don’t have the time or money? In this case, there are some things that you can do to keep your business moving forward while your competitors are fast-tracking their product sourcing at the trade fairs in China.
Consider trade shows in your home country or region
I’m surprised that many Amazon FBA sellers are not aware you don’t have to fly to Asia to meet Chinese suppliers. In fact there are hundreds of trade shows held all year round and very likely somewhere close to you, and in your product category!
Whether you live in the US, Europe, or the Middle East, there’s a major trade show happening close-by.
Let’s take pet products for example and say you are looking for dog collars. In the US there are several major pet trade shows in the spring and fall. In fact, some very reputable and professional Chinese suppliers fly from China to the US to exhibit their products at these fairs.
Suppliers spend serious time and money to fly their team to a foreign country thousands of miles away, go through the visa process, pay for a hotel, meals, entertainment, and shopping in order to meet buyers like you. These suppliers are getting their skin in the game. Don’t you think these suppliers are serious about doing business with you?
Local trade shows a great way to meet potentially trustworthy suppliers because of the screening process I mention above. These are the 20% that are good candidates to work with.
On the other hand, if you attend the Canton Fair, you will find the good, the bad, and the ugly! Besides qualified suppliers, you will also find the riff-raff. Many middlemen and trading companies and small-time suppliers who say yes to everything.
For reasons of lack of transparency, unknown factory conditions, inflated pricing, poor quality standards, lack of attention to detail, etc. these are the 80% that you don't want to work with. Somehow I doubt that you will find them at a major trade show in the US since they’re not willing to invest the time, money, and effort to fly across the globe.
I’m not saying that all Chinese suppliers that attend trade shows abroad are all class-A suppliers, but the likelihood of meeting them is greater.
Be aware that there are limitations to local trade shows. The number of Chinese suppliers will be limited and you won’t be able to meet as many suppliers who make your product as you would if you attended a trade show in China. But this can be a double-edged sword – as the expression goes “less but better”.
Thinking outside the box there are additional benefits to these local trade shows as well. Why not consider local manufacturers who manufacture in the US? Sure, you may pay a little more for the product but you can potentially get better quality product trusting that the product is made locally by a factory that is more familiar with your standards. In terms of selling price, you can market the product as “Made in USA” and sell it at a premium or higher price-point than your competitors’ products which are made in China.
In addition, local suppliers speak the same language which makes communications a lot easier. Also you don’t have to worry about the time difference if you want to email them. You can even pick up the phone and call them.
Speak to some local suppliers at local trade shows and weigh up the pros and cons of sourcing overseas vs locally.
Finally, you don’t have to worry about the whole shipping by air or sea process and importing challenges that can be daunting for many sellers. Similarly, domestic supplier delivery times can be a lot shorter meaning you can get the product faster. This way you can turnaround reorders quickly and avoid stock issues. This is one of the biggest headaches Amazon sellers face that sourcing locally can solve.
Some of you have asked, if I can’t attend a trade show can I extract value from the exhibitor listing? In my experience for Chinese trade shows websites the answer is – not likely.
In theory it should be useful to find suppliers to contact based on the exhibitor list, but in reality:
On the other hand, trade show websites for the US and Hong Kong tend to be better. Moreover they go through the selection process I mentioned earlier. You can identify the Chinese suppliers attending these shows by following the process below. Let’s use pet products as an example.
Step one – Run a Google search for “Pet Show US”. I find that the top result is the Global Pet Expo in Florida. Some key facts that I find are the following. It looks promising!
Global Pet Expo: Mar 22-24, 2017
https://globalpetexpo.org
Orlando, FL
Over 1,000 Exhibitors in 3,218 booths
Step Two – Next I click on the exhibitors listing and look for Chinese city names in the company names. For example: “Ningbo” ABC Pet Product Company. Other regional names include Shenzhen, Dongguan, Shanghai, Taizhou, etc.
Step Three – To find their contact information I would click through to the exhibitor’s page. But sometimes the site requires registration or they may not list their direct contact info. In that case a Google search will usually turn up their Alibaba or Global Sources page.
Step Four – Click through to find their company page and contact them!
Note again, this really depends on how well organized each trade show website is!
Product catalogs can be somewhat useful if they are available on the trade show’s website, but don't expect to find this information easily. If you can get your hands on catalogs, you can narrow down suppliers by looking for those that make the same or similar products.
However if you are looking for new or cutting edge products, don’t expect to find them online. Just as you have fears about your IP being stolen, Chinese suppliers are fiercely protective of their new product IP to avoid their ideas being stolen and copied by their competitors. It’s ironic but they have this fear as well. This is China and it can be like the wild wild west!
If you can’t make it to trade shows this fall or if you are just starting out and learning the whole Amazon FBA process, then I suggest the following strategy for the next 3-6 months.
Focus on getting your business off the ground with the holiday shopping season sales spike rapidly approaching. Continue sourcing product and preparing for reorders.
Remember the huge disruption to the supply chain which is Chinese New Year. This year it is Jan 28, 2017 and factories will shut down for up to one month.
In reality they say they will be closed 10-14 days. But many factory workers will all be returning to their hometowns thousands of miles away and realistically, they won’t be back on track until late Feb to early March. So the takeaway is to place your orders early so you don’t get caught in the last minute rush and get your shipments delayed until after the holidays. Think of the pain of losing thousands of dollars in sales if you miss the boat!
Search for and prepare to attend the next round of trade shows in the Spring. While we’re on the topic of planning for trade shows, the Canton Fair may be the most famous one, but I don’t consider it the best.
The main problem is that it is too big for it’s own good. It’s way too broad and not focused enough. And you will waste a lot of time wandering hall after hall, booth after booth. Your time may be better spent on an industry specific trade fair that’s relevant to you.
It sounds simple but ask your suppliers. If you know that your supplier will be attending the XYZ trade show in Hong Kong in April, then there’s a good chance that other suppliers who also make your product will be there as well. I would check out the fair website to verify this and then register. This way you can meet your (potential) suppliers face to face, build trust and a relationship, and view their products.
If you have time I would suggest that you arrange a visit to their factory as well. You will really learn about how your product is made and even potentially identify new product opportunities of other products that they didn’t bring to the trade show or mention on their site. Moreover, by going over the production process, sometimes you can even point out ways to improve and prevent problems from occurring.
If you're unsure which trade shows to attend, ask your current suppliers!
By now you’ve learned how to prepare for a trade show, what to do at the show, and after show. And also what to do if you can’t make it to the trade show.
By following these best practices and implementing the 80/20 rule you will continue to grow your business, source new products, and not miss a beat even if you can’t make it to the Canton Fair this fall to stay ahead of your competitors.
As a reward for reading until the end, I’ve prepared some free gifts for JungleScout readers. You can find them at 80/20 Sourcing.
Good luck!