How I chose a manufacturer

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I flew to Brisbane today to meet with a manufacturer (amongst another meetings). It’s been a long process, but I finally did chose a manufacturer for two of my products. Yay!!!

Here’s my weekly video update that explains my decision:

This manufacturer is smaller than the other ones, but it seems to be making them much more flexible with lower overheads. This is obviously really important for start-ups like mine with a smaller budget.

For next steps, they will review the brief and designs I sent before and then get started on the “Manufacturing for Design” phase. From that, I should be able to get firm prices for moulds and units. That’s what I need for the business case to investors.

While I’m waiting, I need to chase some leads for intrusion manufacturers for Product #1. I’ve also been given a lead for someone who appears to be a world-class product designer to see if he might be able to give me some advice for the same product.

Overall, it’s been a very productive week at The Refoundry!

Melbourne – meeting manufacturers for the first time

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I got into my car at 5am this morning to drive to the airport when I realised that I left $60 of perishable groceries in the back seat from the night before. Ugh! The first sign that I’m trying to do too much. At least the car didn’t stink yet.

My flight to Melbourne was to meet with a manufacturer (cancelled another meeting with Mfg #4), as well as a publisher regarding a side-hustle.

There were so many learnings from the mfg meeting that I will summarise in a blog post after I meet with the final company on Thursday in Brisbane. For the moment, let’s just say that it’s pretty incredible to see their capabilities in person. The video below shows millions of dollars in machines. Imagine starting this business from scratch!

After a morning of meetings, I raced back to Canberra to attend a networking event tonight for an accelerator program. I always meet so many interesting people when I goes to these, and this night was no exception. I have the business cards of an engineer and a private equity company to follow-up on tomorrow.

Another Day in the Life of an Entrepreneur!

Plastic manufacturer quotes are in

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I finally have all the manufacturer quotes even though not everyone quoted on every item or even every part of the process. Of what I can see, it looks like 2 of the 3 products can be made at a reasonable cost here in Australia with recycled plastic. The third product needs to be redesigned to lower the cost.

Of the moulds (or tooling as they say), the most expensive quote is three times the cheapest one even though everyone says they get their moulds made in Asia. Since this difference is so dramatic, I need to understand why before I choose a manufacturer. Otherwise, the reasoning for the cheaper price may hurt me later if I go that route.

More to learn every day.

One manufacturer out, two left

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I spoke to one of my manufacturers today. This is the one that I had concerns about earlier in the week. We both decided that they should pull out of the selection process for making my products.

They’re too busy to even touch my designs any time soon. Furthermore, we both have concerns about their lack of experience with recycled plastic.

Even today, the engineer was worried that recycled milk bottles (that go through a blow moulding process to make them) might not be compatible with their machines. This is the first I have heard of this concern as it was another manufacturer that suggested that milk bottles would be the most appropriate to get the colours I wanted for my products.

We both agreed that it was the best decision for them to pull out as a result. He still offered to send me some estimated unit prices on one of my products so that I could compare the price against the other quotes. That was a very generous offer in which I am grateful.

By this decision, I’ve decided to also cancel the Monday factory tour with them. This may allow me to get back to Canberra in time for a function that evening.

So, no bridges burned, and the right outcome all around.

Talking to the salesperson versus the engineer

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Despite my tiredness yesterday, I did make contact with the manufacturer who still hasn’t turned in the quote. This time, I spoke to a design engineer rather than a salesperson.

He basically told me that they were busy, and my designs needed a lot of work. I explained that the designs were never meant to be final. They were my way of communicating what I wanted to a manufacturer located in another state. As per the tender docs I sent to them, I was planning on paying for the next design phase to get it ready for manufacturing. This is something I’ve already explained before to his boss.

I asked him to tell me now if they’re too busy to work with a small business like me. Otherwise, we are both wasting our time.

He said that he’ll try to get me something this week. However, I am now concerned about their lack of experience with recycled plastic as he suggested that all the parts needed to be black. This is the difference between talking to the engineer and the salesperson – you can really start to understand their capability. I wish I was able to speak to him sooner.

Oh well, it would still be great to get their quote, but I’m not going to depend on it at this stage.



Trip to Brisbane

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I’m in Brisbane the next few days for a conference. Since I was already in town, I scheduled coffees with a couple of old contacts.

The first one was with someone who I think might be really useful on my future board of directors. She didn’t know that was partially why I wanted to meet with her until then. After all, I really don’t have much to offer her in exchange for her time and advice yet. Still, it was worth having that conversation early to give us both time to think about her potential contributions for the future.

The other person was an old contact from my last job. He’s a successful entrepreneur himself, and it was good to test my product ideas with him, as well as ask for advice about picking the right investors. It was ironic when he recommended my Manufacturer #1 to me without any promptings as he has done business with them before. Small world.

It doesn’t look like my schedule this trip will align with Manufacturer #1 to see their factory, but it was good that my friend also endorsed me to them – saying that I was serious and “not just kicking the tires on this idea.”

My friend also introduced me to someone who appears to be the founder of a social impact accelerator. I can’t tell if it’s only for Brisbane, but it does seem to be a fairly mature group. In any case, I’m always happy to gain more advice about attracting investors to my social enterprise. So, we’ll try to meet in the next few days.

I say molds, you say moulds

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I spoke to the manufacturers today about my Request for Quotes. I think we’re all on the same page now. Essentially, they believe they can give me unit product costs estimates, but will struggle with giving me the moulds’ prices until they have redone the design work. That’s because the moulds (or tooling) are outsourced to other companies.

What I have also learned is that there are many things to consider when designing the moulds. For instance, I can combine parts or create multiple pieces of the same part in the same mould. The bigger the mould, the more it costs. However, I can save money in the unit cost. Of course, if we get it wrong I might also have a lot of excess parts the customer doesn’t need.

I’ve also learned that it may be possible for the manufacturer to amortise the tooling cost into the products with them essentially acting as a bank. That could be really useful depending on how much money I can raise from investors. I’ll be surprised if they’ll do this though without a large order – something I can’t agree to do until the products are proven.

I’ll write a longer article next week about what I might have done differently in the design phase.

If I make it too hard for business partners

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I’m starting to get feedback on the product designs from the manufacturers. Even though I told them that it was only meant to convey an idea of what I had in mind, I think they are evaluating the designs as already fit for manufacturing because I sent them CAD files.

I’ve asked for a phone call with one of them in the morning. I have a feeling that I’ll need to jump on a plane and spend a day with each of them to get the information I need.

I would have done this already, but I didn’t see how I could get competitive quotes this way. I still can’t, but maybe by meeting their teams and seeing their factories I can choose a partner and go on from there. Right now, I risk losing their interest in my business if I frustrate them too much.

Feeling naive…

Milestone: Request for Quotes sent to Manufacturers

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I sent the design and tender documents to the three manufacturers today. Since I didn’t have any industry experience, that was actually a huge milestone for me and the business. I should be celebrating.

Instead, my monkey brain wants to think about the potential worst case scenarios: the manufacturers not wanting to work with me or the quotes coming in way too high to have a business case.

In a weird way, I welcomed the distraction of having to figure out widgets and custom theme issues with one of my new websites today. IT help desks are starting to become my best friends!

Patent research

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I spent most of the day researching both Australian and international patents for anything close to my products. It’s exhausting especially since I’m not an expert in “legal-ese” or product design. There doesn’t appear to be any active ones in Australia which is good. It’s hard to know for sure for the other countries though. As much as I want to consider everything while finalising these designs, I can only spend so much time and money on this now. I’ll have to revisit once the products are proven here, and I’m more serious about exporting.

Today, I also had a good chat with Manufacturer #3 which took forever to organise with them. I have a phone call with Manufacturer #4 (referral from a friend) tomorrow. I want to have a competitive process for selecting my manufacturer to ensure I get the best price and engineering team on board. This is especially important since I’m looking for a long term relationship with them, and the cost of stuffing up a design could cost me 5-figures for a new mould.