How to try and avoid fraud when dealing with Chinese Suppliers.

When you buy from a Chinese supplier, you have to do what is called due diligence or research about the supplier you want to do business with. Check out reviews from previous customers, request and analyze samples, and do everything possible to verify the manufacturer is reputable before placing your order. A visit to the factory is essential if you are going to be buying large quantities. Once you decide on the factory and place your order, arrange to hire an inspection service to do a QC check before shipment is made. If possible pay using a secure payment method like credit card or PayPal so you at least have a small chance of recovering your money if the deal goes bad.

These are some things you should be doing before you make any purchases, whether it is merchandise from a local supplier or an expensive item for your personal use. Do your Research!

Remember, it is your money you are spending and your customers that you are shipping the merchandise to.

Is it worth risking your money and your business reputation on an unknown supplier, just to save some money?

Now if you are worried about finding a supplier to build your patented product or IP product, that is a whole other set of concerns. As a new buyer from China all I can tell you is buyer beware. No amount of Non disclosure agreements or iron clad contracts will protect you if the factory chooses to defraud you. The distance you are from the factory, communication or language problems, and the differences in the legal systems will give you only a very small chance of success in resolving any patent or IP issues. Get everything in writing. Do not rely on any verbal agreements.

The two most common scenarios are as follows. I like to call them front door fraud and back door fraud.

Front door fraud. You are based in the USA. The factory is visited by a buyer from some other country, say South Africa, and sees your product on the production line. He asks for a quote. Now the proper way to handle this would be for the factory to refer him to you for a quote, but little Mary sales girl sees an opportunity to make a commission for herself or to reach her sales quota so she can get a bonus, so she quotes the South African buyer direct. She thinks since you, the patent owner is based in the USA, and the buyer is located far away, you will never know. If you ever find out about the sale, the factory owner will simply say, oh sorry, the sales girl is new and didn’t know better.

The second scenario is as follows. Back door fraud. Engineers from the factory, or management employees that have access to your files, steal your info and either sell the info to a different factory, or establish a production line themselves and manufacture and sell your product. In this situation, nobody knows nothing. The production line can be shutdown or renamed easily. you will probably never be able to find them. Or, if you do find them and try and sue, the cost of legal expenses makes this extremely difficult. You can spend a lot and sue, you may even win a judgement, but will you every be able to collect anything from a small factory?

So as a new company looking for a factory to produce your patented or IP product, preventing fraud requires extreme measures.

  1. Have different sub assemblies manufactured at different factories, them do final assembly in a different facility.
  2. Build the sub assemblies in China and bring them back to the USA for final assembly.

You may be able to save some money, sometimes even a lot of money, having a product manufactured in China, but if you’re not big enough to spend the money on security, quality control, and patent protection, will it be even worth it?


How Soon Can You Expect To Make A Profit With A New Drop Shipping Business?

You could start to make a profit from drop shipping in your first month, or you could work forever and always lose money. It’s all up to you, the choices you make, and how hard you want to work.

  • You need to choose unique products that are not facing huge competition in the e-commerce world.
  • You need to choose products with a high enough selling price to maximize your chances to make a profit.
  • You need to negotiate the best prices possible from your suppliers.
  • You need to find suppliers that will give you rapid order processing and shipping service so customer satisfaction is outstanding.
  • You need to answer customer questions and handle customer service issues rapidly.
  • You need to target your marketing to the correct demographics to most efficiently use your marketing dollars.
  • You need to vigorously control your business expenses to try and maximize potential profits.

If you are successful in handling the issues above and choose the right products, you may have a chance of being profitable.

What do you do when you have a great idea but no skills or resources to Execute?

Write your idea down, then develop it into a business plan complete with details and estimates about what you think it will take to get it developed into an MVP.

By writing everything down, you will be forcing yourself to actually think step by step and this will give you a chance to get organized Refine your plan and make sure you include everything you expect to need. Then, redo the plan The goal is to develop your idea to the point that you can actually present your idea logically to recruit a team or attract potential investors.

Since you don’t or can’t develop your app by yourself, the goal is to execute your idea up to the actual point that someone else can build the app based on the framework you have detailed.

Can a small business outsource their marketing manager?

The question is can a small business outsource their marketing manager?  But just as important is the question, Should a small business outsource their marketing manager?Yes, as a small company you can, and many companies do outsource their marketing services.

Yes, as a small company you can, and many companies do outsource their marketing services. You outsource to get access to marketing skills you could not otherwise afford.  You outsource to access part-time “experts” to form and deliver your message.

Just make sure you can clearly communicate your company image and marketing goals to your outsourced manager so you can work towards a consistent company brand, image, and presentation. It was your idea, dedication, and hard work that started the company in the first place and you should have the best input about the direction you want for your company.  Try and maintain a working relationship with one marketing manager and don’t jump from marketing company to marketing company unless you are not getting the results you desire.

One of the most important messages a marketing program can project is consistency and a standardized image in all stages of the company presentation. You want customers to see you as a valued, professional company and a unified look on your website and marketing materials helps to build trust with your customers.

Is e-commerce passive income?

E-commerce, especially with the acceptance and growth it has enjoyed over the last 20 years is still a great way to make money. But… and you know there is always a But with every question. E-commerce is about more than just throwing a few items to sell on a website or sales platform like Amazon or eBay. It is hard work and definitely not Passive Income.

Your success will depend on several things:

  1. Finding a unique product to sell. The competition for selling common items is intense. On all of the major sales platforms, you will find lots of sellers of similar products and razor thin profit margins unless you have something unique to sell.
  2. Developing unique and creative ways to advertise and market your product. You must figure out a way to make your products stand out from all the other similar products. You must give your customer a reason to buy from you instead of all the other competition. Write unique and creative sales copy. Take high-quality photos showing your products in their best way possible.
  3. Customer service. You must be able to answer customer questions in a timely manner, ship goods quickly, and handle any follow-up issues the customer may have. Be knowledgeable about your products so you can offer assembly or installation tips. You must appear professional and trustworthy before you can expect to give your customer sensitive information like credit card numbers.
  4. If you are going to sell from your own website you must market the hell out of your products so people know you exist. Customers can’t find you if they don’t know your name or if you even exist. You must be willing to use free marketing, social media marketing, paid advertising, email marketing, and whatever else it takes to drive traffic to your website.
  5. You must continually strive to improve. Add new products, seek out new marketing opportunities, and stay ahead of the competition.

Now when going thru all of the above points, nowhere do I mention passive income. E-commerce is not a passive business even with all of the advances made in the field of automation and performance apps. E-commerce takes hard work all the time. Researching and sourcing new products and new suppliers, writing and creating attractive advertising, and most importantly developing hands-on customer service.

What are some great niche products for YouTube?

One of the hardest facts to realize is that a Niche is a Unique, specialized segment of a market. This makes it low competition and allows the seller to make a larger profit margin on the items in the niche. Once anyone announces a popular niche, especially on a public forum like Quora, it is no longer a niche. New sellers will jump in to take advantage of unique marketing and selling opportunities and the extra competition drawn to the niche usually results in fierce price competition.

Take the time to do your in-depth research and use your product knowledge to find that special niche you are looking for. YouTube videos offer a very special and unique way to advertise and market. Look for products that have a special “magic” or visual appeal and opportunities to create fun, in use videos. You may only be selling a common item like shoes or other similar items but try and create some buzz. Show real people using the product in real yet creative ways. If you get lucky and have a video go viral, sit back and enjoy the ride.

What are your responsibilities regarding shipping and delivery when you drop ship?

The clock will start ticking for the carrier calculated shipping when the tracking number is entered in the system. It is all up to you, the seller, to have a negotiated agreement with your supplier about how long they will take to process your order and ship product. You then inform your customers with a statement in your ad copy like, “Usually ships next business day” , or “Usually ships in three business days”. You then also let the customer know how long the average transit time is based on the shipping carrier you use. Of course, this all goes out the window if you use an international drop shipper, but you are still ultimately responsible for everything you say in your ad or sell on your website.

You are the seller of the products you advertise. There is never a situation where you don’t have control of your shipping if you have done your job of picking your suppliers wisely. That is your responsibility and your job. It is a simple matter to understand. If you don’t have control of your shipping, you have not done your job right. You communicate with your supplier, you should have a reasonable expectation that your supplier will keep you informed about inventory levels and pricing.

You, as the seller, are responsible for shipping delays if your supplier runs out of inventory. You must tell the customer the expected backorder shipping date, and if that date changes, update the customer ASAP.

Here is a paragraph from the FTC Federal Trade Commission website, called the 30-day rule.

“The Rule requires that when you advertise merchandise, you must have a reasonable basis for stating or implying that you can ship within a certain time. If you make no shipment statement, you must have a reasonable basis for believing that you can ship within 30 days. That is why direct marketers sometimes call this the “30-day Rule.”

If, after taking the customer’s order, you learn that you cannot ship within the time you stated or within 30 days, you must seek the customer’s consent to the delayed shipment. If you cannot obtain the customer’s consent to the delay — either because it is not a situation in which you are permitted to treat the customer’s silence as consent and the customer has not expressly consented to the delay, or because the customer has expressly refused to consent — you must, without being asked, promptly refund all the money the customer paid you for the unshipped merchandise.”

Full address to the FTC website is

Business Guide to the FTC’s Mail, Internet, or Telephone Order Merchandise Rule

If you are selling on Amazon or eBay or similar platforms, shipping delays and backorders translate to customer dissatisfaction and complaints. These translate to poor reviews and complaints which could get you banned as a seller. Once you get banned, it is really difficult to get reinstated.

How do I get the artwork for my web site?

A customer has written me asking for an app to scrape photos and product content for his website.

Contrary to popular belief there is not always an APP for everything, nor should there be.

The purpose of an e-commerce website is to sell a product, and one of the toughest jobs of all is to convince customers to buy from you rather than the other 99,999,999 sellers using the exact same pictures and ad copy provided by the suppliers. Make your ad look unique and special. Take high-quality photos with proper backgrounds and good lighting. Show the product itself and show it in use by people your potential customers can relate to.

Product content works the same way. The factory or distributor wrote sales copy designed to sell the product from one professional (The factory)to another professional (The e-commerce seller). Their ad copy is usually not designed to attract or inform the consumer about the product. Write unique ad copy using product features, product benefits, tech or spec data, and then tell your shoppers why they should buy from you instead of anyone else. If you use the same sales copy as everyone else, why should anyone choose you?

I understand you may want to use an app because it is the easy way, but really, sometimes the easy way is not the best or most profitable way.

It takes hard work to be successful in whatever you are trying to do. Why not put in the necessary effort to be successful.

What Should You do With A Great Business Idea?

Write your idea down, then develop it into a business plan complete with details and estimates about what you think it will take to get it developed into an MVP.

By writing everything down, you will be forcing yourself to actually think step by step and this will give you a chance to get organized Refine your plan and make sure you include everything you expect to need. Then, redo the plan The goal is to develop your idea to the point that you can actually present your idea logically to recruit a team or attract potential investors.

Since you don’t or can’t develop your app by yourself, the goal is to execute your idea up to the actual point that someone else can build the app based on the framework you have detailed.

Since higher education is not necessary to get rich, why do so many people pursue it?

Not everyone has the maturity, skills, ambition, or passion to work for themselves or start a business. Especially at 18 years old, very few people actually have a clue about what they want to do when they grow up, you know, that old maturity thing rearing its ugly head.

Spending a few years learning how to learn, learning new skills, meeting new people, developing new relationships, and learning new interests has a very beneficial effect on many people. It doesn’t have to be a higher education at a university level, it could be a trade school or professional school level. It could be an internship or apprentice type of experience. Just go out and experience, learn, observe and get a clue about real life.

Remember, in the real world, having an education or not having an education has no effect on getting rich, and not everyone only wants to get rich. Some people have other priorities in their lives.

Getting rich requires hard work, ideas, skills, planning, and execution to do it and based on the new business failure rate, obviously, not everyone has what it takes.