Toy Industry Shakeup & Chinese Amazon FBA Brand Expansion with Thierry Bourret

gfa248 amazon toys
[00:00:00] Episode 248 of global from Asia GFA 248 and we do spend time with the show notes. You can check out the show notes and images of these guests and other info at global forum Asia.com episode 2 4 8, let’s tune. Welcome to the global from Asia podcast with a daunting process of running an international business is broken down into straight-up actionable advice.
[00:00:28] And now your host Michael Michelini. Thank you very much for choosing to download or stream or listen to this. We chat. We can’t podcast is getting popular and WeChat my amazing wife Wendy. Partner helps me out getting into our WeChat official accounts and some of you even shared on Facebook. I saw Kathy Sheran John grams podcast last week on her Facebook.
[00:00:56] But using the WeChat official account link. [00:01:00] I know the world is very confusing and here at Global from Asia. We are all about bridging. Trying to bridge Asia to China and the rest of the world Today’s show will be a very interesting one like that. So thank you again for choosing to listen to us. We are very happy to have such great response from people listening and enjoying these last few shows.
[00:01:22] So it makes me a little bit warm and fuzzy inside the because you know, I usually do my disc this preview of each episode on Friday afternoon kids are screaming around downstairs at the house, but. I sneak up here for the show coming on Tuesday to do a little bit of intro and talk about what’s happening and Rico which was a guest a couple weeks ago.
[00:01:49] Listen to the show and like my little outro my conclusion. I’ve been kind of ranting at the end of these shows for about I don’t know seems like 10 minutes or so. I’ll add some more at the end of this [00:02:00] show. We have a I have a lot to say I’m going to talk about some life perspectives with Chinese factories and Chinese sellers.
[00:02:08] So if you want to hear that. I’m not going to squeeze it in the intro. I want to get into the interview as soon as possible, but I will rant at the end with about 10 minutes. Maybe I’ll maybe I’ll keep that up and get a little feedback people like Thats My perspectives on the Chinese factories and sellers or just my little perspective of each episode we talked about so.
[00:02:30] This show I recorded when I was down in Bangkok, it’s you know, it’s not as big as China Thailand, but do you do need to fly around a little bit? I’ve been going out of Bangkok from Chiang Mai every now and then for different different reasons different projects and I got to catch up with teary.
[00:02:46] He’s a he’s a amazing amazing experienced business Trader import-export Amazon business person in the toy industry. And he’s got some really amazing [00:03:00] insights about what he’s seeing in the toy industry and Amazon world and Europe and with Chinese factories building their own Brands. And the way the whole world is going supply-chain the history.
[00:03:12] I mean, I have a long list of stuff we did this in person and I’m a little bit Rusty. I had to brush off the dust almost literally from some of the ATR. Mice my different microphones and the portable podcast player pay a few hundred bucks for that thing and. Little bit embarrassed but my side of the microphone was not really working for the first 10 minutes.
[00:03:36] So you’re hearing my side from his side. I might re-record Alvin are amazing editor might fix that but luckily his his microphone is working and you know, he’s the guest his content is really amazing and really valuable and I’m really excited for today’s show and we. You know, I think this show is actually something we like talked about with Echo Fraser.
[00:03:58] We’re kind of between a [00:04:00] Chinese world and and the international World here and the way the you know, trade Wars and and debts and and way the sellers are growing around the world and. Just some lot of amazing stuff and put it away the program progress over the years and some of the opportunities in the global markets and and some really fun stuff.
[00:04:23] So we are very lucky to have Thierry on the show and before. I’m going to give you my perspectives of Chinese sellers ties Factories at the end after we finish all this and actually a little tidbit at the end. I’ll talk about some it’s just sitting inside. I had a I had a nice coffee meeting with a huge seller from Egypt from Europe while I was in Chiang Mai here also about the same time and he’s he’s getting kind of crush.
[00:04:51] I’m not going to reveal his name, but he’s getting he’s feeling the Chinese sellers squeezing him and I’m going to talk about that after the show. So [00:05:00] let’s get into this toys and Amazon and Europe and Chinese factories with Terry now, it’s tuned. Thank you. Our sponsor go remit dot HK formerly known as Orillia pay for cross-border payments from Hong Kong.
[00:05:14] So if you’re like me and you make payments into China Philippines for va’s Thailand for your rent or anywhere in different parts of Asia Vietnam as well. Definitely check it out. Go remit dot h k. They are across border Payment Solutions company for those of us doing cross more payments and Asia through Hong Kong.
[00:05:33] They’ve been supporting a show for the. Years, and if you enjoy glow from Asia, I highly recommend you check them out free to sign up go remit dot HK. All right. Thank you buddy for tuning in to other Global from Asia podcast. We are here in Bangkok Thailand and I get to meet a friend through Crystal Chris Davies from his meetups Theory hooray.
[00:05:58] Yeah, that’s correct. Great. How [00:06:00] are you doing? I’m fine. Thanks and you I’m doing fine good. So yeah, I’ve been to Bangkok for a while. I’m glad we got to meet up while I’m here and I’m going to I’m glad you came. I haven’t met anybody from the from Christians meet up for a long time because I used to live in Hong Kong and moved to Bangkok in in July last year.
[00:06:22] And since then I’ve kind of lost touch with a lot of guys. Yeah, so we’re staying in touch and we yeah, we both made the move to Thailand and you you. Originally from the UK. No, I’m French friends. I haven’t lived in France for 32 years now. I think I left France in 1986 to learn English and I want you to work on a cruise ship.
[00:06:48] That was the plan and my parents are the hotel and restaurant and I wanted to go on a cruise ship as a head waiter and I went for the interview. Everything was great, but then they said, Your English is not [00:07:00] good enough. So I thought okay, so I went that’s all they said but we can you should go and work in the UK for a few months and then after that come back to us and I went to the UK.
[00:07:10] I never went back for a second interview and I stayed there for a long time. I have lived in the UK. I have lived in Japan. I’ve lived in Hong Kong and now I’m living in Bangkok. Nice, very International. Yeah. Yeah. Yeah. Yes, very International. I work for a very big Japanese company for a long time and I used travel to Japan a lot.
[00:07:38] And I think I traveled a lot even still now. I traveled an awful lot. I was in Australia last week. I think this year I have been to UK Germany China Australia and it’s only beginning of March. [00:08:00] Yeah, it’s I’m getting back into can meet him in back in travel, but I just did my my Visa. So oh I see just the humans just hang out and Chiang Mai.
[00:08:12] It’s good to be here man. Cock is much more. Action here. Yeah, there’s a lot of things happening in Bangkok is there is a an entrepreneur seen here, which is which is good. Probably less less busy than than Hong Kong. I was used to a lot of meet up in Hong Kong and they are a lot less here clear.
[00:08:38] You know and I think they are few a few co-working spaces that organized organized training meetups and things but it’s less frequent definitely less frequent than in it was in Hong Kong in Hong Kong. I think they they suffer a little from an overload of co-working spaces and and therefore they all trying [00:09:00] to organize something to compete here.
[00:09:02] They are quite a few co-working spaces, but not not quite as many. You know why I chose this one because it’s very close to my home and it’s very convenient. It’s just down from the BTS station and it looks like not you know, I like it here. Yeah, we’re be they gave us a nice room to record and and everything is is good.
[00:09:26] You know, we talked about cross-border business cross-border e-commerce on the show and. I’ve always known you as the toy. Yeah, I’m the toy guy. I have been in the toy industry since 2008. I work. I had my own toy Distribution Company in the UK. I distributed Brands like orb from Canada Radio Flyer from the US that I think a lot of people know I distributed quite a few different brands in the UK as a distributor.
[00:10:00] [00:10:00] So importing from China mostly and selling those Brands to large retailers. That’s where I started although. Not many distributors or not many Brands will tell you although now is things are more open and they all are an e-commerce site sometimes Brandy that they’re all named that more often than not not branded or branded under another name because they didn’t want their.
[00:10:30] Customers or their retailers to know that they were selling online now things are a lot more open legal. For example, I’ve got their own websites selling to selling directly to through to the consumers and quite a few brands have that now and and Distributors are doing that as well. So that’s how I got into e-commerce.
[00:10:52] Our e-commerce didn’t come, you know, like I want to start a website selling toys. He’s just that. I had some toys [00:11:00] in my warehouse and thinking yeah, great. They’re sitting there and waiting for the orders from the retailers and let’s try to do something with that stock. And that’s how I started website retail website using prestashop at the time and so on and then at the time we were selling to Amazon.
[00:11:21] So Amazon Vanda. And that’s who we’re selling to but Amazon was only interested in in US listing part of the ranch not all the whole range and we started listing the rest of the ranch as Amazon FBA. So that’s how that’s how I started the other danger as well for I mean not for the US market because in the US market most Amazon and everybody has to.
[00:11:52] Comply with the RP we are in Europe. You don’t have a harpy it’s [00:12:00] illegal for a brand or anybody to fix a price and and you know, you can give your customers a suggested retail price, but that’s it and Amazon as got the Amazon vendor has got the habit of not respecting that. I’m trying to sell cheaper and cheaper and cheaper and for Brands.
[00:12:24] It’s a real problem. The other thing with Amazon vendor is the fact that if you have a distributor in the UK a different distributor in France, and another one in Germany lines become a little blurred. For example a number of years ago. There was a product was a frozen license which you know, you can imagine the demand on that and the range was about I think 10 or 12 product and I gave exclusivity in the UK on to two of the [00:13:00] product SKU as we call them and I give exclusivity.
[00:13:05] And then a few weeks later the by a calls me and said yeah, I thought you gave me exclusivity. Why is it on Amazon? I’m thinking wow. I don’t know. So I ordered one to find out where it came from and the label from the French distributor was on the box. So I call the friendly spirit and I asked him what he was playing at.
[00:13:23] And so I promise you I didn’t sell to Amazon UK and then we found out that they Amazon. Realize that this ends on that product. We are good in France and thought oh, why isn’t it listed in the UK and Julie imported or shipped from the Amazon France Warehouse to one of the Amazon UK warehouse and that was it so consumer wise I guess it was good for the consumer, but for me as a distributor and for my retailer in the UK, that was not.
[00:13:58] So I would be I [00:14:00] mean, I’ve always been a little wary of Amazon vendor compared to Amazon FBA because Amazon FBA I can list the product can make sure my listings are good. I can make sure that my price is according to my suggested retail price and and that’s it. So I’m. I’m a lot more. I’m a lot happier using Amazon FBA rather than Amazon Vandal generally speaking as a brand as a brand and that would be because it seems like the control is easy.
[00:14:43] It’s kind of a control. Yes. I understand that. You know, we shouldn’t I mean as a brand you shouldn’t control the price and so on but you know, I’m working. I mean I was working with a lot of retailers. And the retail is they’ve got brick and mortar. They’ve got [00:15:00] they’ve got to pay for rates rant tax and so on and we all know, you know, I don’t know if you if you listen to to I mean, I listened to France news and and European news quite a lot and they talk about Gaba and Gaba our Google.
[00:15:18] I’m a Zone Facebook and so on and the fact that they don’t pay tax in Europe what they pay little tax in Europe and and therefore and you’ve seen the retailers are disappearing at the rate of not you know, the lots of bricks and mortar shops are disappearing. And therefore the reason for that is amazonas got Amazon and others.
[00:15:43] I’ve got a lot to you know a lot to answer for. You know bookshops have disappeared. I mean in the UK we used to have lots and lots of bookshops when I leave there and now, you know, they’re disappearing because because of Amazon there’s no other weapon that [00:16:00] and I I I I see the use of Amazon I use Amazon I make money out of Amazon, but I’m still thinking, you know, sometimes I’m worried about it.
[00:16:10] Yes true. It’s like a. As a buyer is he people have no problem with sounds good to get the best price. I mean isn’t. I’m going to say the wrong thing, but I think it’s three things that basil server Amazon like the best price to fastest and mean customer service is fast price. And as always everything is over here is the thing the thing they have reached which the return you know, you’re not happy with it.
[00:16:37] You just return it and that’s it. And that’s I mean as a consumer it’s. You know don’t get don’t get me wrong. I’m on I use Amazon. You know, I have an Amazon Prime or I had an Amazon Prime when I lived in the UK and it was it’s fantastic service, but you know, you’ve got to see the other side of it which you know, it can be it can be a monster.
[00:17:01] [00:17:00] Yeah, so I know Europe fights a lot of these American internet companies right like if had fights with Microsoft. Google and now it seems Amazon’s like their target now Amazon is a target. Yes, definitely in Europe. I think the European Union is trying to do something with with the fact that those guys are not paying the right amount of tax.
[00:17:24] You know, they’re making they’re making a lot of. In Europe, and they’re not paying a lot of times I listen to the news today, you know in France where you know, they are going to tax those people and you know, somebody called the radio and said yes, but you know, those guys are going to leave and and the the the TM host of the program actually said do you seriously think that Facebook is going to leave France because we’re going to start texting of course not.
[00:17:56] And I think it’s all about Fair taxation, you [00:18:00] know, and I think those guys will have to realize and at the end of the day we will all have to pay more because if those guys are tax and they don’t make the same amount of profit consumer will have to pay more. yeah, I actually haven’t followed the Trump stuff, but it seems like.
[00:18:17] It seems like it’s back back down the whole trade War the trade war with China. Well, you know, let’s put it this way in the in the toy industry. Everybody has been extremely worried about it and they were stockpiling of goods in in the u.s. Especially, you know, waiting for, you know, just in case.
[00:18:40] Tariff was going to be imposed. It was not imposed last year. I think last year the toy industry had already a massive issue with the loss of Toys R Us in the loss of Toys R Us in the US has been a massive blow to a lot of a lot of companies [00:19:00] and and not just and a loss of Toys R Us has had an impact on a lot of a lot of things I’ll give you an example, you know as a toy as a toy company.
[00:19:10] When you have a new product or a new range of product Toys R Us used to take a risk and then you’ve got 800 shops that say okay fine. We’re going to stalk 20 or 30 of this, you know, it’s makes toilet make toy companies actually think yeah, that’s good so we can launch that range because we’ve got at least.
[00:19:33] The backup of the order from Toys R Us and that has disappeared and you know a lot less Innovation is happening at the moment because people are concerned that you know, where are we going to place it? Those are some not no longer there. I know Toys R Us. He’s trying to come back. And you know, they they are trying to but they left.
[00:20:00] [00:20:00] Some a lot of companies in a lot of trouble because they didn’t get paid and I think that the guys at this time trying to restarts Toys R Us are going to find it difficult for everybody to sell them toys because they’ve left some bad debts behind. Yeah, I guess when they restructure they don’t honor the old.
[00:20:26] They’re not going to honor their dates then yeah, as far as they are concerned. That’s it. Stop. They start our Direction. They start afresh, you know, I have heard a lot of rubbish about about about does the demise of Toys R Us. Yes Toys R Us made a few mistakes. Okay one mistake was to sell on Amazon.
[00:20:48] Okay and do a partnership with Amazon that was their biggest mistake rather than launch their own. Because they need gave all the data to Amazon and to say it right. Thank you [00:21:00] guys making out now. We’ve got all the sellers data. We know exactly what to do and what to what to buy and that was it and then the partnership failed and you know field of went away and I was it and they forgot to invest in their own website and I think that’s where that’s where the issue is.
[00:21:18] The other big issue is Toys R Us is. The fact that they were saddled with so much debt from from the investment company and repaying that debt men that they couldn’t invest in in website and social media and and so on and that’s why I think that’s why they died. Unfortunately, you know, it was a great retailer to work with that’s for sure.
[00:21:46] Yeah. I mean everybody there Brandis is amazing. I mean. Yeah, Timeless is FAO Schwarz. They’re still around Jesus was came back. He feels right. It feels Schwartz was on his own was [00:22:00] owned by Toys R Us and they sold it to a company based in Hong Kong called 360 sourcing or something like that. So they are making a big comeback.
[00:22:13] I don’t know if you guys are aware. But you know, the the biggest toy fair in the world is the one in Nuremberg in Germany in February and they had FAO Schwarz had a booth they’re selling their own branded FAO Schwarz product. They’ve also got a partner in China and called kids land and they are planning to open their first shop in Beijing in a few weeks time.
[00:22:40] And I think they have a program of opening something like 40 shops in China at some point. I think if your source is going to go somewhere hamleys, which is another big name in the toy industry is struggling a little bit and they owned by a Chinese company and the Chinese company is not [00:23:00] doing particularly.
[00:23:00] Well, and I think he’s trying to offload it at the moment and they’ve got a lot of franchises around the. I think one of the one that’s the most successful is the one in India is doing quite nicely owned by a company called Reliance in China in Chinese are in India, you know hamleys Hamlin’s in China.
[00:23:23] I don’t think he’s doing particularly. Well, I think they’ve got three shops now that I plan to open a lot more but I think that that program is dead in the water. So course you’re the toy. Toy expert you think similar things as seems like this is probably a Trends not just in toys, right what we’re talking about that, uh me tail stores.
[00:23:45] I think this is happening. It’s a crosses the retailer lots of retail stores happening worldwide. I mean, there’s no doubt about this, you know Toys R Us in Australia gone Toys R Us in the UK gone, but there are some they are [00:24:00] some some interesting other companies in the UK. You’ve got a huge company called the.
[00:24:06] Who I’ve got a number of toy shops and are doing nicely there and they’ve expanded and they are expanding overseas and they’re doing well. And I think I think that you know, they are that the lines between supplier manufacturer distributor selling online. This is all getting very blurred. Okay, all this you know in if you look at some UK Market, you used to have a lot of toy Distributors.
[00:24:39] So the toy distributor was between the factory the brand and then the retailer there was a distributor so that guy used to take a risk by stock and sell it to the retailer and retailers found. Oh, well, let’s not do that. Let’s go directly to the factory. And then they did that for one. So they bypass the distributor and [00:25:00] so on and then they realized that because of the internet they were making less and less margin.
[00:25:04] So you get a company in the UK John Lewis big department store you go there most of their toys are their own brand because they have a they have a moto saying never knowingly undersold which means that they had to honor prices. So if you buy a toilet 10 pounds somewhere and he was unselect 11 at John Lewis.
[00:25:29] Generally say, oh, you’ve got it a 10 there. I will sell it to you for 10 and therefore it was easier to do OEM for them. And that’s what they’ve done. So they doing a lot more OEM products and a lot of their program our OEM. I’ve just been to Australia. I went to Target their came out. It’s a lot of toys are OEM toys.
[00:25:50] So they go to the factory was their own design say make it for us and that’s it. And that’s it. And they know the margin they make more margin [00:26:00] they make it’s better and the Chinese factories haven’t understood that so in the past a Chinese Factory minimum order quantity 3,000 units per skewer.
[00:26:11] Okay. Now when 1500, you know something that much smaller because even the Chinese factories are struggling now and they’re looking for a lot smaller Mo cues than they used to because they know that it’s difficult now to attain the the huge volumes that they were acquiring its so what do you think is the right place to be?
[00:26:38] You’re I guess the brand right the best is talking I bring the Brandy is important and I think a lot of Chinese factories have understood that I regularly post on LinkedIn and I recently posted about about the Chinese Factory finally finally understanding the value of a brand and they are they are developing their own brand, you know [00:27:00] from so they manufacture they do a lot of OEM work and odm, but they also develop their own.
[00:27:07] One of the companies I work for because I’m a consultant on my day job is a classic World which is a wooden toy company and they have a huge OEM or DM department and I am looking after the brand inside of the company trying to develop the sense worldwide for them. They doing very well in China. But the rest of the world pockets in poke some pocket countries that you want the rest not doing so well, so that’s why they got me into to do to do the development of the brand and building the name building the brand so we spend money on social media when just starting so it doesn’t look great at the moment, but it’s getting there.
[00:27:56] We reviewing the packaging. We’re employing some good [00:28:00] designers. So we not doing me to products, you know, if you go in the toy industry because that’s the industry. I know. Well you get a lot of me to use. Okay, and you do get it anything. Oh, yeah, that’s product great. Then you see there and see there you see there and you know, all they do is change the color put them in their own baggage in I don’t see the point there really, you know, all you do is end up competing on price for the similar.
[00:28:29] And nobody’s making money because the Chinese factories not making money. They people selling it online or in their shop not making money. So, you know at some point so you need that’s why you you’ve got the needs for a designer and a pretty good designer and it’s not on the packaging. It’s you know product point of difference on the product and so on.
[00:28:53] Yeah, I would agree. I think Chinese have finally started to understand the brand. It’s more than just a logo on the [00:29:00] product. No, it’s no time. He’ll they’ve you know, if you go to China now compared to when I used to go there 20 25 years ago. They’ve got all the shops with the big brand names and they I think they realized that well, you know, yes, we wandered we’ve returned we want this we want that and there is a value in building a brand because it’s not something that you think are always nothing.
[00:29:25] It’s just a name. It’s something you can sell possum. You know, I must confine you so so that’s that’s what the the you know, they’ve understood it. And in the past they you know, the Chinese factories used to have their in-house designers and now they’re employing foreign designers, you know in the company classic we employer french guy Israeli lady and.
[00:29:53] An american guy, you know doing doing designs and bringing things into the [00:30:00] company that I haven’t seen, you know ice and been seen before it’s true. I mean the emergence of the Chinese brand. Kind of goes back to what we were discussing earlier. I mean like the merging of all this supply chain and the value of a brand and then the Chinese brand.
[00:30:22] The stores like Amazon. What do you see is what do you see the future? Do you in your crystal ball? When you Krista boehm acoustical? I see I see I see that is there a lot of online competition? I mean Amazon is trying hard to to go into in they’ve gone into India. They’ve gone into Australia.
[00:30:42] They’re trying to get into China. I’m not sure that’s working. So. They’ve got to contend with some big boy there. China’s a Zone. Yeah in Asia, you’ve got Lozada who is starting to do. Okay, you know it still is doing [00:31:00] well actually talking about that. I haven’t seen many Amazon FBA sellers selling on Lozada and I think that it’s a lost opportunity there.
[00:31:10] Yes true. I mean, I’ve had a few but not too many. It’s. I’m the marketplace model is working. Well, if you look in our you know, another Market I know well is the French Market where you know, you’ve got other players you don’t don’t not only have Amazon in France. You have a CD scant you have level dude where it’s a Marketplace as well.
[00:31:35] So I think there are many many opportunities that that are opening Tesco in the UK you serve a market place. System as well. I’m not sure they still have but you know, they used to have a few years ago. I haven’t looked into it recent sure, you know, so the whole thing is being blurred between manufacturers [00:32:00] suppliers Distributors retailers online retail, you know, this is all being very fluid at the moment and I am not sure I mean, you know, I’m.
[00:32:11] I’m 57 and I don’t think that in in my working life. I will see much much more different to what’s happening at the moment. I think that the lines will become more blurred properly, but I don’t think there’s going to be an absolute revolution in compared to what I have seen since I started to work.
[00:32:36] Okay. Well, this is a fascinating conversation. For taking your time to share. How can people find you online or find me online. I’m on LinkedIn. I’m very active on LinkedIn and my profile is you know under my name Tre boy. I have my company website because I’m as I say, I’m a consultant for a classic world, but [00:33:00] my company is Connor.
[00:33:00] Matcha, Kon om o CH a.com. You can link it up on. Okay. Thanks so much. Thank you very much. Are you looking to grow your international business from Asia Amazon FBA import-export in cross-border e-commerce are Trends in today’s world, especially here at Global from Asia and we put together an ecourse ebook both actually all together for you for free with so fast track getting you going global from Asia.
[00:33:39] Check it out at global forum Asia.com ebook. You get the book as well as an interactive e-course that will be catered based on how you answer the email Series. So I look forward to seeing you on the inside. Check it out Global formation a.com slash ebook. Thank you so much Terry. It’s great to [00:34:00] have you sharing on the show.
[00:34:01] We’ve been we’ve met a few times and we’ve been talking about this and I’m glad we finally made it happen. And I think it was pretty fascinating. I noticed some technical issues on my Mike. I hope I hope the listeners enjoyed. And like I said in the intro, I’m going to give some of my perspectives of the Chinese Brands and the World is Flat and all of this stuff.
[00:34:22] You know, I’m just a stupid white guy are stupid American in China for well not in China and Thailand are Asia for 11 years now and unfortunately my Chinese still isn’t that good, you know, but. I my eyes are my eyes work and I see a lot and not the only one there’s a lot of other people simple sides, but I just thought I would share I’m not gonna obviously reveal the person or the product but you know, I’d there’s obviously a lot of Amazon sellers in Chiang Mai and Thailand.
[00:34:57] I’ve been having the opportunity to sit down with [00:35:00] some of them. And and talk and they asked me of course. I’m like, you know China China guy and they’re they’re seeing their factories are starting to compete with them in Europe. And he says, you know a few years ago. They were selling against him and he didn’t really care because they didn’t seem to know what they were doing.
[00:35:19] But he saying now the factory that he buys from. Is getting better on Amazon and he’s getting worried now and he’s asking me what to do and we had my kids there and my wife was there my wife it wasn’t no no, she’s Chinese and so she’s listening and she does anything to him at the spot, but I wrote him in a message later about what she had told me, but I thought this is pretty fascinating.
[00:35:45] So. I don’t I don’t know. I basically what she says was. You know, that’s why Chinese factories don’t sell to Chinese sellers or don’t like to sell to Chinese sellers. [00:36:00] They like to sell to foreign FBA sellers are for an e-commerce sellers because here’s the craziest part. I never I was kind of mind-blowing for me.
[00:36:10] They don’t set up factories themselves. You know, she says the Chinese sellers don’t have a factory to beginning but then they buy from the factory who say they’re selling. I don’t know keyboards, for example, and then they bought the Chinese seller sells the keyboards on. Anna on Amazon are doing really well and they’re buying from the factory air.
[00:36:34] Like you know what I live in China. I’m Chinese. I can hire a production manager. I can rent a space I can find the component suppliers. I can make my own keyboards and they become the factory themself. And actually the real feedback I gave to my friend and a really amazing seller for 15 years and 1,000 always in Chiang Mai, but he just he’s a Westerner.
[00:36:58] I don’t want to reveal too much [00:37:00] was that he’s got to buy from different factories. He can’t buy everything from one Chinese Factory because they see everything, you know, honestly, you know an assist on oh, I still got to get you an update but. It’s nerve-racking to buy everything and then you give them your design files.
[00:37:16] You say here’s my packaging print my boxes assemble all my goods, you know, you know my buddy Mike Bellamy he has I gotta get back on the show. But if you probably know him from passage maker he was he did some great podcast interviews on GFA many years ago take him up on the archives. But you know, you would do the black box or maybe you’d use a sourcing company like Insight quality Andy Church, Or you’d use Rico sourcing Services Source find Asia or any of these amazing service providers, but I know a lot of times people want to buy Factory Direct and then they just say, hey, I’ll just give the factory my high-resolution logo file and [00:38:00] my AI file Printing and hey, these are my sub suppliers or can you find my basically the factory learns everything and then they even know how to print it for Amazon and then.
[00:38:11] And then I don’t know if you’ve heard these other crazy stories, but you know Amazon asks you to verify your suppliers that I’m going to purchase order. You know, I’ve met people like one one Factory owner I met is in Malaysia and he owns his Factory in Shenzhen and he’s he’s Malaysian Chinese and he was so raging mad because he says that he Amazon hostile.
[00:38:32] And he sent it to Amazon, but it was his own Factory because but you know what Amazon did they called the factory and he said hey your this product sells really well. Why don’t you open your own Seller Central account? We can help you. We can send somebody from our Shenzhen office to train you how to do this.
[00:38:50] You know saying like seriously, he was like so enraged. Luckily. He didn’t happen to him because he owned a factory. So it was like the salesperson and the [00:39:00] companies like hey boss, you know if Amazon just called me and says we should sell directly on Amazon. What’s up with that? He’s like, oh it’s because he asked me for.
[00:39:08] Purchase order and then they have their sales team in China, which we actually no contact the factory and tell them sell directly against a seller. And so that’s kind of stuff that happens to you. So, you know, whether you think that’s right or wrong, you know, this guy and Chiang Mai The Foreigner the seller or 15-year along seller says what is what is the goal of Amazon?
[00:39:29] Did you just want to put everybody in Europe out of business did it, you know and then that is a good question, you know, I don’t but I think you know. I think I think their motto is, you know fastest cheapest, you know, and the best service, you know, that’s just to be the best of all of those so, you know, it’s thrown away though, you know, you can’t worry about keeping the jobs.
[00:39:51] I was in the Philippines and I remember people saying the jeepneys have these Barker’s if you have any idea what I’m talking about. There’s these people that grab people from the [00:40:00] road and try to sell them a bus ticket to go onto one of these like army jeeps and they make like a peso each to get somebody on to the jeepney.
[00:40:08] And then somebody says well if the trains come or some ways come what are those Barker’s going to do to get money and I’m like well obviously have to peep out the find other jobs, and maybe I’m going to go a bit too crazy on my rant here. You know, I think what it’s really challenging. I don’t know.
[00:40:24] I think I think you know I have I’ve had friends on even as podcasts like Chris Gormley. He he does LEDs in Australia. I think he recently exited but he he owned a factory had or had a joint venture Saint Mark’s was also here. He had like a strategic deal with the fact of his e-cigarettes for Sky Sig, you know, I think you have to have a very intimate relationship with your supplier.
[00:40:49] Is either Option 1 or become the factory? And I know you’re like oh, I don’t know anything about China. I don’t want to do business in China. I don’t become like John Graham from last week and get stuck in China exit band [00:41:00] or maybe buy from factories outside of China, honestly, you know, I mean, this is just the way it is, you know, the the this is the reality you have to play by the rules or play by it.
[00:41:11] Maybe I don’t see rules but played by the way, the things are. So another strategy maybe it’s trying to split up your supply chain. Like I mentioned like someone to call a black box where you buy from multiple different suppliers. You send it to a QC company or a sourcing company or a logistics company and then they put it all together.
[00:41:28] They by the packaging somewhere else. So it’s not like you’re just giving all of the data. This is the really the key and like like Terry talked about in this Toys R Us example Toys R Us put all their products onto Amazon. And then Amazon can kill them because Amazon sees all of the data, you know what I’m saying?
[00:41:49] So if they can see what’s the hot product and wants to not hot product they can drop them. You know, my first business was bar products. I drop shipped 200 or 300 excuse. Why lived in New York City working [00:42:00] on Wall Street, and I didn’t have any of them and then I dropped half of them to and I knew what sold so I knew what I could invest in so it’s really about the data.
[00:42:10] You know I’m saying so it’s whether it’s a Chinese Factory you’re buying from if they see all of your data which means all of your products they know everything. You have risk or the obviously you’re kind of stuck with Amazon a know everything if you want to sell on it because they obviously see everything and they can compete directly with you.
[00:42:27] They could then try to get you to send a purchase order so they can tell if actor to sell against you, you know, this is not a happy-go-lucky world. This is a dog-eat-dog world and you know, I understand why China. Sellers do what they do or Western sellers or factories, you know, but maybe who’s the winner?
[00:42:46] Who’s going to be the winner? Maybe it’s gonna be Amazon directly, right? We’re all fighting for the fighting each other. I’m kind of ranting but you know, you could just skip this I look into the timer about nine minutes on my outro record. [00:43:00] But this stuff’s all kind of keeps me up keeps me up a thinking always, you know, but really the real goal, you know, we’ve had my good friend mayor on this show from Brand Masters and you know, it’s really about who owns the brand.
[00:43:14] I mean, it’s also a teary said in the interview, you know, who is actually the brand owner brand is everything in the only thing really in its what the customer. Recognizes and trusts and wants to buy so and it’s the heart really honestly the hardest thing, you know, you can I think Global for Mages a brand.
[00:43:33] It is a brandy know six years grinding out these course. I took a few months off, but building trust building relationships building re you know, you know, I guess I’m. Building building a connection with people and people think of something. I don’t know. I wonder what they’re Jeff Bezos quote a brand is what people say when you’re not in a room.
[00:43:55] It’s just you know, what would people say about you have family on the room. They say I do too many things. [00:44:00] I’m not focused enough, you know, we have all kinds of crazy interviews, but I like this stuff. So, you know, I guess that’s a GF a brand we talk about crazy stuff. Honestly. I have some really crazy interviews that might be not normal and but we mix it up here we talk about stuff.
[00:44:16] International business from Asia from China and I do got to get some more of these Chinese sellers or Chinese factories on the show. My wife is getting bombarded by WeChat of a lot of these people that want to get back onto Global from Asia. I don’t live there but we can try to get Skype to work or figure out a way to record we chat or I’m actually planning to go there.
[00:44:36] I just got a training gig in May. To go to Shenzhen for some training seminar, so I’ll plan to be there in May late may but maybe we’ll do some more interviews, but. this is what gold from Asia is and I hope you enjoy this these endings and maybe if you do [00:45:00] send me a quick note at my kit Global from Asia.com is say I like the outro like the 10-minute outro or we’re at 11 now, so.
[00:45:10] Take care of it and see you later. To get more info about running an international business, please visit our website at triple w dot Global from Asia.com that triple w dot Global from Asia.com. Also be sure to subscribe to our iTunes feed. Thanks for tuning in.