One of the biggest challenges of a physical product business is just that – physical products.
Sourcing, shipping, and managing inventory is a complex operation that can frustrate beginners and pros alike.
But it needn’t be insurmountable challenge, and there are strategies you can use to run an efficient and profitable supply chain operation.
In this week’s episode of the Brand Builder Show, we sit down with supply chain expert Afolabi Oyerokun.
We talked about how to save costs when shipping overseas, optimize efficiency when working with a 3PL, building a moat around your business, and much more!
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00:00 Introduction to Guest: Afolabi Oyerokun
00:58 Background of Afolabi
07:02 Afolabi’s favorite five
11:01 Standing out with product innovation
13:29 How do people build moats in their products
14:42 Opportunities for sellers to go in and build a moat around their product
18:54 How much innovation is too much innovation
20:26 Overcoming the resistance coming from your manufacturer
22:52 Cost of mold process and when does it become worth it
25:35 How to protect and prevent others from using your mold
27:39 Insights on optimizing the 3PL strategy
34:31 Saving cost on 3PL
40:09 What will Afolabi do differently if he will start all over again
42:43 Where to find Afolabi
Hey folks, welcome back to another episode of the brand builders show. And if you want to improve your sourcing and supply chain management, then this is the episode for you sourcing products and managing your supply chain is a massive, massive task for the modern day brand owner. And so we have brought Afolabi onto the show today to bring some knowledge and help us in this journey. Afolabi, Welcome to the show. Thanks for joining us.
Afolabi Oyerokun 00:24
Thank you. I’m happy and honored to be here. Thanks for having me here.
Ben Donovan 00:29
It’s my pleasure. I’m looking forward to diving in and learning about you. And I always say to guests we have on like I said to yourself, I have to stop myself asking too many questions when I meet you for the first time because I think they’re probably questions that our audience wants to hear the answers to as well. So to bring us up to speed on your entrepreneurial journey, let us know, what have you been up to in the last few years? What is your experience and backstory and bring us up to date with with where you are right now?
Afolabi Oyerokun 00:58
Awesome. Well, I started sometime 2002, I had designed some shoes, some sneakers, very, you know, colorful sneakers, and I was looking for a way to make it. I was looking, you know for who to help me develop it. I have the drawings, I have the graphics, I have everything I was excited, I just got out of fashion school in New York and you know, looking, looking all over trying to find some way to make the shoes. I couldn’t find anything. Because those days, we don’t have Alibaba wasn’t really big in those days. So and we had the dial up internet, you know, those internet, you connect to your phone and hear the sound. You know, so I finally after sending out a lot of inquiries, I finally find I found somebody, his name was Johnson out of Taiwan. And he says, Hey, we can help you make your shoes. I’m like, okay, all right. What’s the process? So he walked me through the process? He says, No, you’re not, you know, you have to come here. I said, like, why would I need to come there?
Afolabi Oyerokun 02:09
Anyway, long story short, I had to fly into Taiwan to meet Mr. Johnson, in a went to meet with his team. And it was an awesome experience. We started building the mold and developing the shoes. And little by little did I know that I was going into territories that I had no clue what I was doing. So I spent a lot of money, I had to borrow money from friends to make the mold, I shouldn’t have made the molds. I’ve just started with an existing mold and just grow the market first before investing 1000s and 1000s of dollars into molds. Because when you’re doing molds for shoes, you have to make a mold for different sizes, you know, so if you’re doing size 8, in US to 12 or 13, you have to make mold for each of the sizes. So it gets really really expensive. So I had to make the molds it I had tons of designs instead of like narrowing down my design to just a few. You know, I went like 40 designs, you know.
Afolabi Oyerokun 03:23
So anyway, we got to production. And he said to me that my minimum order was going to be one full container like Wow, 7512 pairs of shoes. I still remember clearly. I didn’t know better. You know, I didn’t know I’m not supposed to get sucked into minimum order quantity, especially for an unproven market. I mean, I didn’t even have a clue how I’m gonna sell these shoes. But anyway, I went ahead did letter of credit and whatever. We made the shoes, I had to visit the factory. I did the inspection by myself. Of course, it couldn’t be perfect. You know, I wear a size 13 US the samples that I was testing was a size 9. So I couldn’t even test the samples. I just went blindly into building this product.
Afolabi Oyerokun 04:23
So we got the product manufactured and I started going to trade shows because that was all I knew at that time, you know, and then one way or the order Amazon reached out to me as like, Hey, we’re, you know, we’re starting to receive new products into our platform. We you know, we’re transitioning from selling just books. We want to start selling, you know, merchandise, we think your product is a good fit. Would you like to sell on that platform like, of course, you know, I don’t know how to unload 7500 pairs of shoes. So those were the days there was no sellers.
Afolabi Oyerokun 05:00
Central, it was really tough. Everything was by CSV file. So I got on Amazon’s platform, it was live and people were actually buying this US had no clue how they found it. There was no paid house, there was nothing. Anyway, they were finding issues. But there was no FBA either, you know, so you have to fulfill by yourself. So I had this guy, Mr. Ken, somewhere in California, that was helping me to fulfill the orders, the orders will come in.
Afolabi Oyerokun 05:32
Many times he forgets about the order it will you ship it out until a week or whatever, it was a mess, total mess. But looking back, now, I saw all my mistakes. And we sold a lot of those shoes, and it got to a point that shoes were being returned because the sizes were wrong. You know, you know, I was like, What am I gonna do? Am I gonna like, you know, run somewhere and hide on an island or whatever. So I got to a point I said, You know what, I’ll just liquidate this inventory. So I had to find a buyer somewhere in in Florida, and I sold, just liquidated the whole inventory. I’m like, I’m done. You know, later, I go back into Amazon. But that’s another story we can get to.
Ben Donovan 06:21
Definitely, yeah. So a lot lots of lessons learned and particularly around sourcing which, you know, is the old saying, you know, that we learn the most from our biggest mistakes and, or biggest challenges and you obviously, you learn some things the hard way and are now putting that into practice into really bringing a valuable service. So that’s something we’ll definitely dig into a bit more. To get to know you a bit more love to just do our lightning round with you our favorite five lightning round. It really helps digital marketers, ecommerce brand owners learn new tactics and also get to know you a little bit more. So firstly, do you have a favorite e commerce brand?
Afolabi Oyerokun 07:02
Yes, I I love apple. Because I’m very visual in terms of height I like I really appreciate simple designs. And I love packaging when something is cleverly designed and packaged to I’ll pick Apple as my number one ecommerce brand.
Ben Donovan 07:24
Nice. What about a software or tool that helps you run your business or life
Afolabi Oyerokun 07:28
I use a little to meet people may not know about it that much. But it’s called whimsical. It’s workflow a, you know building when I’m building workflows to launch a service or to launch a product or to design you know, our, you know, 3PL workflow, I go to this tool. It’s like a mind mapping tool flow chart tool. So I really love it. It’s what whimsical?
Afolabi Oyerokun 07:57
Yeah, definitely. That’s quite unique one, I’ve not heard that before. And I’m sure there’ll be plenty of our listeners that could find that useful, though and planning things out and mapping things out. So that’s great. Great. Okay, what about an organic marketing channel?
Afolabi Oyerokun 08:12
You know, as, even though the the security reasons that this app is facing a lot of problems now, I still prefer TikTok. Because of the level at which you can go viral and which you can drive traffic to your listings or to your product. I will say TikTok still is one of the best if not the best for me at the moment.
Ben Donovan 08:40
Nice. in one word answer. Do you think it will get banned or not?
Afolabi Oyerokun 08:46
Ha, I think they will force a sale. I don’t think it will get banned. Because there’s such a lot resting on that app, that it has a little bit of a political pool as well, because the young people you know, kids and teenagers are using TikTok and I feel that if they ban it outright, I think it’s going to affect the current administration politically, because they’re looking towards the younger, younger people’s vote. So that’s my take. I think they’re going to form a sale but it’s going to be very hard for them to ban it.
Ben Donovan 09:33
Yeah, I agree. I think I don’t think you’ll get banned but we’ll see. Okay, number four, a favorite paid marketing channel.
Afolabi Oyerokun 09:43
I will still pick Instagram at the moment for return on investment. Purpose. I still feel Instagram for me does better.
Ben Donovan 09:55
And then what our business book
Afolabi Oyerokun 09:57
The good old reached out Poor Dad by Robert Kiyosaki as always been the most transforming book for me. I was in college when I read it. And I felt like just quitting college and just going somewhere else to go start a business. So, to me, that’s still gonna be my best book so far. Good, good. Love it. Thanks for doing those appreciate that some helpful information for our listeners. So talking then of product innovation, it’s something that you as you mentioned, with your backstory, you have learned some things the hard way, but you’ve obviously learned some lessons, and are really excelling in this area now with everything you’re doing in your day to day business. So how can our listeners really stand out with with product innovation? Obviously, the e Commerce Industry selling on Amazon, for example. It’s a maturing industry, so there are more people doing it. So to stand out, our listeners will need to innovate, can you speak to how people can innovate with their products.
Afolabi Oyerokun 11:01
So thanks for that, I would want to start with my story of how I knew that product innovation was going to be very key for small brands, or micro brands. I was in China, like six, seven years ago, and I saw how Amazon was starting to invite factories to come and sell on their platform. When I saw that, I’m like, Oh, wow, game over, game over. Game over for the smaller guys, that is just selling a me too product that is just selling a, you know, average private label product, that you’re just going to slap your label on it, it looks the same as everybody else, just put your label on it and start selling. I knew the time was over and I started getting on podcasts, I’m like, Guys, you gotta wake up, the factories are gonna start competing with you very, very soon. The only way you can outsmart them is by
Afolabi Oyerokun 12:05
creating innovative products. And for me, an innovative product is a product that is most driven, Mo HC, which is a product that has a unique selling advantage. You don’t want to go to war unless you have a competitive competitive advantage over your enemies, right. So is the same way you want to build any brand, you want to sell any product. These days, you need to have a product that will save you money in fulfillment in storage cost in tariffs, you need a product that will look different solve problems that your competitors products are in solving at the moment, it’s going to be a product that is unique to you and product that you can protect one way or the order so that nobody can knock you off.
Ben Donovan 12:58
Yeah, that’s really good. And how do I know it’s a hard question to answer? My immediate follow up is then how do people build moats in their products? Because we would obviously say the last thing you want to compete on is price because a race to the bottom is one that nobody wants to win. Can you give us with your experience? And I know you do. You haven’t sort of touched on it too much. But you do a lot of sourcing work where you have your agency, is it? Is it sourcing agency, or can you give us some more info on that
Afolabi Oyerokun 13:29
Supply chain. So we kind of put everything together instead of instead of just doing sourcing, we discovered that the brands and the customers that are coming to us they just want a more holistic approach to their product. So we offer them product development, sourcing, inspection, shipping, clearing, tariffs, reclassification and warehousing, and 3PL and order fulfillment, we put everything under one roof, so that you don’t have to deal with seven different vendors, you can just streamline your operation. And we’ll get we’ll get to that with you just streamline your operation, and you can save yourself a lot of time and effort in your business.
Ben Donovan 14:11
Yeah, smart. That’s good. Okay. And so in terms of that moat, what are some of the most common ways or the opportunities I suppose for sellers to go in and build a moat around their product? Is it a case of having to innovate with brand new products? Or Can someone take a yoga mat is the example I always use and build a moat around a new kind of yoga mat? Give us some some thoughts on that.
Afolabi Oyerokun 14:37
Awesome. So when you’re building a product, when we’re talking about product innovation, people always think oh my god is going to be so expensive. It’s gonna be a product that is so complex, no. Building a moat around your product just could just be changing the materials. I had a customer that was really big on, you know, in puzzles. You know, she’s like, how can I make my puzzle better? You know, she’s like, what are the, you know, what other materials can I use? I’m like, What’s everybody using? You know, everybody’s using paper. Okay, what can we use? Can we use PVC? Can we use wood? It’s like, yeah, wood wood is good. I know, a very few very few companies are using wood. I said, Okay, let’s do wood, and let color the wood inside every other puzzle has like a, you know, like a brown color inside? Like, how about you have like a felt material on the inside? How can you color it blue, so that when they see any blue puzzle, they know it’s yours? Right? So these are simple stuff that you can, that you can come up with, that you can introduce into your product to make it completely unique. Some some might be if the product is so big, why don’t you turn it into like a telescopic version, whereby it fits into very small packaging, instead of fitting into a large package. You know, why can’t you use other alternative materials like, you know, PVC, like composite materials, you know, when everybody else is using wood, guess what, you could use something else. And also, you could redesign your product to be flatpacked. You know, you can make the customer assemble the product by themselves. So there are tons and tons you can add music, you can add, you can add likes, you can add, you know, sound, you can you can put remote control function to your product, you can add app to your product, you can make your product do two things, if you have a frequently bought together products, let’s say you’re selling a knife, I all of a sudden notice that some people are also your frequently bought together product is a pillar, you will have you know what, maybe I can create a knife on the pillar together in one single product, you can design it that doesn’t cost much, these are really simple products that you can come up with, by reading what the problem is, and looking at what is missing in the market and also finding what you’re passionate about.
Afolabi Oyerokun 17:19
So if you marry passion, with what’s missing in the industry, and two solutions that you want to create, you want to solve the problems you want to solve, you will be able to create a really good product that it’s going to be hard for anybody to knock it off. But remember to protect it.
Ben Donovan 17:40
Yeah, that’s awesome. And it really aligns with our philosophy at Brown University, we talk about creating high quality products that solve problems for a specific group of people. That’s kind of like the Brand Builder blueprint as such. And so I think that’s really aligned with that. And, you know, finding something that you’re passionate about solving is something that, you know, sometimes people shy away from because they think, Well, yeah, I know, I’ve said in the past, don’t sell the products, you know, don’t just jump into a product that you’re passionate about, because the emotion of that can allow your, you know, the data to be skewed by your emotions. But if the data does support that passion, then that’s a perfect combination. In terms of finding those opportunities there, you you listed loads there, which is super helpful, and definitely is going to help people start to think of ideas. How do they start to narrow down like how much innovation is too much innovation? You know, like the yoga mat, for example, someone releases a wooden yoga mat that’s got remote controls and lights and sounds and you know, that’s gonna be a bit much right. And I know, that’s a silly, a silly example. But just from that perspective, how much is too much? How far do people need to go with innovation? To really stand out?
Afolabi Oyerokun 18:54
Well, I have a rule of thumb, which is innovation should make things simpler, not make it more complicated, not make it harder. It should be simpler, and simpler and simpler, where your customers are finding it hard to even understand what your product does. When you’re when they find it hard to know if this is a yoga mat, or a music mat. I have this guy in New York and he comes up with some weird products you could put like it could put out is the kind of person that will put a speaker on a yoga mat, like why would you do that? You know, oh, I want to make it Bluetooth. And I also want to be able to throw the mat up there. And I want to be sliding to have a little wheel match. You don’t have a wheel. So when you start overcomplicate things, your product is getting complicated and harder. Instead of making it simpler than what’s already in the market. You know you’re going too far
Ben Donovan 19:59
Yeah, definitely. Okay, that’s helpful, very helpful. And then in terms of making those innovations or improvements or reality, obviously sourcing is another big part of the challenges for sellers getting started, if they’ve never dealt with a manufacturer before. Do you find much resistance when you go to manufacturers and say, actually, we want to make these changes? And if you do, how do you overcome that kind of resistance?
Afolabi Oyerokun 20:26
Yes. So when you’re looking for when you’re when you’re going into product innovation, and you’re looking for a supplier, how do I go for suppliers that are called ODM, which is original design manufacturers? Those are the suppliers that can actually modify structurally a product, they when you come up with your innovation when you tell them about what you’re about to do. They’re excited. They’re excited. So they ODM suppliers, if you go to an OEM supplier, which is just somebody that wants to do private label for you, then you’re going to face a lot of resistance and the project is going to take so long. So when you’re searching for your suppliers, make sure you filter your search by looking only for ODM suppliers. In fact, when you’re sending your first inquiry to your supplier, I can list all these things down in my new sourcing course. When you’re going into Alibaba make sure you’re looking for an ODM supplier so that when you’re sending your first inquiry email, it says hey, I’m looking you know, are you an ODM supplier? Because I have my own design that I want to do once you narrow down and you’re only dealing with ODM you know kinds of suppliers, they will be happy to to help you with your product. And some suppliers may say, Look, we will need a we will need the help of a mold maker or we need the help of a mold designer, you know, then you can source for product development firms in China as well. There are you know, a few of them there that can actually design and develop prototypes for you. And once you do that, then you take it to your main supplier and say I want to replicate these these are the files helped me redo helped me replicate these in your own way.
Ben Donovan 22:25
Yeah, nice. You mentioned mold there and getting one grated early in your career. It is quite a daunting process for a lot of new sellers. The idea of doing one is well I can create a moat and create this unique product. It’s great. Firstly, in your experience, how much should someone expect to pay for a mold process? And then B. when does that become worth it? In your opinion?
Afolabi Oyerokun 22:52
Yes. So mold is a very sensitive part of product development. I’m going to use like a cell phone case, for example. So let’s say you want to make a mold for the cellphone cover, it could, this could be maybe $2,000 or less, it’s going to be injection molded. When is it worth it. If you’re making a big product, then the mold can be 30, 40 $50,000. So I would advise before you even get into molds to can 3D print your product first, test it in the market, make sure it’s good before you even invest in mold. And then when you decide to invest in mold, make sure that the ROI makes sense. There are different materials that are used for mold in I’ve seen brass mold before I’ve seen copper mold before I’ve seen aluminum mold and steel mold. It depends also on the lifespan of the mold. There’s a mold that can create only 300,000 pieces of this product. And then they they’re not they’re not good anymore. There’s a mold that can make a million pieces of these and they’re not good anymore. So you have to work out your rate and say okay, if I’m spending 10 grand on a mold, and it can only make 100,000 units. So what’s my return? What’s my amortization on my mold? You can also say okay, if I pay $2,000 More, and I get a brass mold, and that can do 500,000 units, then you say oh, okay, all right. So a brass mole is actually more, you know, has more ROI than the other one they wanted to do for me. So I think you should punch your numbers when you’re looking at the mod and say, Okay, how many pieces of this product can I comfortably sell in a year or in two years or in five years time before my mold expires? If you don’t think you can move a lot of volume and that product, then I wouldn’t invest so much money into the mold.
Ben Donovan 25:05
Yeah, and it’s interesting to note, I think for a lot of our listeners, you know, not all molds are created equal, like you say there’s great differences between them. So that’s something that’s should definitely be investigated in that process. Wow, what I know a lot of people would ask about the protection of that molds, then a supplier, potentially using that for somebody else. So that’s obviously a big no, no, from our side of things. Does that happen? Or is that just a complete no no for suppliers as well?
Afolabi Oyerokun 25:35
They do, they try to do. So when you’re building a mold, you have to have a mold ownership agreement in place can make sure that you own that mold. And that it’s not a modified mold. Because if your supplier is modifying a mold for you, they can lay claim on it, or they can buy it off of you, they can say, Well, look, we cannot release this mold, because it’s a modification or it’s a modified version of our own mold. So for that reason, we cannot release it to you. So be very sure that before the at the very beginning, everybody’s clear, you have a mold ownership agreements, you can take your mold anywhere you want. If you want to relocate it to Europe, and do your manufacturing in Europe, or the US or Canada or Mexico, you’d be able to relocate it anywhere you want.
Ben Donovan 26:24
Yeah. Awesome. There’s so many more questions I feel we could go into but for sake of time, we’ll move on. But obviously, we’ll be leaving your details in the show notes, if anybody did want to reach out and take advantage of your services, because you know what you’re talking about this for sure. But let’s let’s talk about 3PL operations briefly, because I know that’s another area of your expertise. And it’s something I want to dive into because it’s becoming more important for sellers to really get a good 3PL strategy in place, or a good supply chain management strategy, you know, regardless of 3PL or direct to Amazon, or direct to consumer, whatever that is. But from a three Beals perspective, how should ecommerce owners really optimize that part of the process? Can you give us some some expertise and insight into how you’re really optimizing that stage of the process and keeping costs down when it is a really costly aspect of having to sell on, you know, selling on Amazon used to be able to just send everything straight to Amazon, as you know. But now with more and more 3PL costs coming through it does affect margins? How can sellers navigate this effectively?
Afolabi Oyerokun 27:39
Yes, so 3PL and supply chain management. Smaller brands or ecom brands are just warming up to that phrase supply chain management. It’s a phrase that bigger companies have really figured out several years ago and the US supply chain is just the path of the journey your product travels from conception, to manufacturing, to shipping to QC, to warehousing and to order fulfillment till it gets to your customers hands. That’s just what supplies and that’s like a fifth grader definition of supply chain that I can give it. 3PL is part of that supply chain and they do the logistics part that means the receiving the safekeeping storage and fulfillment either to send it to Amazon or to fulfill directly to your consumer. So these day, there are different types of 3PL’s many people don’t realize it there is order fulfillment 3PL. That’s what they’re good at. They’re good at fulfilling your order. So if you’re selling on Kickstarter or all these places, they can fulfill your order for you they will store and fulfill.
Afolabi Oyerokun 28:57
There is a product prep or Amazon you know prep 3PL now whereby they will store your goods and they will send it to Amazon for you. They are not set up to do order fulfillment. You know, it’s going to take them forever to do order fulfillment and it’s going to be very expensive for them. And the first repair that I defined which is the order fulfillment 3PL. They do not like receiving containers. They want you to sip the ship them just boxes, little boxes, they will receive it in they have to tag and put label on every single unit that you ship to them. They don’t like receiving containers they don’t like getting big trucks. They only want small items. And they don’t like sending products to Amazon because most of them don’t have loading docks.
Afolabi Oyerokun 29:50
And the third type of 3PL is the hybrid one so they do a little bit of these and a little bit of the other one. They can do your Amazon prep. They can show fulfill your Shopify orders, and they can do massive D to C fulfillment. So you first you have to talk to you have to interview different VPS know what you want? What kind of business are you building? Do you want to just sell on Amazon? That’s fine. Do you want to just sell on Shopify and you’re looking and you’re looking for a fulfillment 3PL, they know that that’s what you’re going for. But if you want to add a little bit of both, you get then you’re looking for a Hybrid 3PL, which is 80 90%, Amazon, and 10% of Shopify, or other channels, Walmart wherever else you’re going to be selling, right? And when picking 3PL, I have a have a list of questions you should ask. So for everybody listening today, you know, you’ll be able to download it, I’ll see you know how to make it available for you guys to download this cheat sheet for you to talk to your 3PL about. And I’ll say the best way to get a 3PL is through maybe a podcast like this or referral will be my number one. Most of the people I will say 90% of the people of brands that we carry in our 3PL they came by referral. I think you know, when the 3PL is doing a good job, people will naturally refer them and say hey, this is what I’m using. This is a 3PL I’m using. So please ask your friends, you know if they’re happy with their 3PL that’s the number one source of finding a good Threepio. Another one is communication. If you’re talking to a 3PL and it’s taking them forever to reply you that’s problem. Third one software, do they use software? Can you see your inventory? Like can you? Can you create orders? Can you create, you know, work orders directly from the software? If no then problem, how flexible? Are they? is another issue? Are they flexible to help you bond, do they do killing for your product? Can they help you? If they if your product has issues? Can they help you fix it? You know so many things in flexibility, automation, accessibility, cost saving solutions, can your 3PL sit with you and discuss how you can save the goal of your 3PL is not to suck out as much as possible from you, You usually get to be a partnership, that should be an extension of your business. So you guys should sit down together and see how you know if 3PL should look at your workflow and say no, you’re gonna, you’re gonna be wasting money on, you know, logistics costs. If you keep doing this, we have a lot of brands come to us. And I’ll say, tell me what you’re doing. Now. Let me see your Let me see your workflow. So I’m going to bring this product, and I’m going to send it to North Carolina, and I’m going to I’m like, why are you sending it to North Carolina? I don’t know.
Afolabi Oyerokun 33:01
Oh, and then and then I’m gonna do the inspection when he learns not? Why are you doing inspection in the US? It’s expensive. Why don’t you do your inspection and your labeling? You know, from the origin? So there’s so many things to take into consideration. Do they have turnkey services house? The speed at which they send your goods out? Are they reliable? So all these interview questions will be in the cheat sheet that we’re going to make available to all our listeners.
Ben Donovan 33:33
Awesome. That’s perfect. Thank you for that, in terms of keeping costs down, you said about, you know, working with them to find ways to make it manageable finance wise, one of the big expenses, and one of the big challenges is the extra step that it creates having to whereas you used to be able to just send direct to Amazon. Now you have to send some stock to sometimes to 3PL. And there’s obviously then the receiving costs there. And then there’s the pick and pack to send those cartons to Amazon as you send them and the shipping fees to Amazon. So there’s extra costs involved there. All right, What strategy do you run in order to optimize that do you send you say you have a client that their restock limits or their you know the cubic feet system that is now Amazon? They are you know, getting towards limits so they can’t send everything to Amazon? Do you try and then just send everything to a 3PL and then everything onto Amazon? Or do you try and send some direct to Amazon to save on costs? Or does that end up becoming such a nightmare that it doesn’t save on costs? Do you have any kind of insight you can give us there
Afolabi Oyerokun 34:41
I think it’s by case on a case by case basis. First your supplier that is going to be shipping your goods out if you’re sending directly from let’s say from China, to Amazon, your supplier better know what they’re doing. Because I’ve heard a lot of oral stories by by default, that’s the most cost effective way to do a split your goods and say, Alright, this one’s you go direct into Amazon and this one should go to my 3PL. But if you don’t trust your supplier, if they don’t have a lot of English speaking people, or people that can manage that floor over there, it could become a nightmare. They could send the wrong items, slap the wrong labels on the wrong box, ship it to Amazon and create a lot of mess and problem for you. So I would say it depends on when you know, when do you order the products, time your orders very well, to maximize if you trust your supply, to maximize how you send it from, you know, your supplier first into Amazon, and then the rest can stay with your 3PL I used to be a good I used to be a promoter of keeping your stock in China because the warehousing is cheaper. But with the COVID What COVID thought every one of us, you know, I don’t want to leave my goods over there. I don’t know what’s going to happen. So I still like to have it on US soil as close by as possible so I can react to market changes and market trends. I had this lady, she she ships from China directly to Amazon all the time, until somebody on TikTok did a review on our product. And she’s sold like who knows 5000 units in a day. She’s like, I don’t know what I’m gonna do. Yeah, you have to go order either. She is calling from China and everything because she couldn’t react because she doesn’t have a 3PL here. So she learned in a hard way. Another reason you might want to put into your workflow for your 3PL is the returns. Now that Amazon does not reimburse us for returns damaged returns anymore, we found out that most of the products that Amazon calls damaged and not actually damaged goods, they were just opened and maybe the packaging was bad. So you can talk to your 3PL especially if you send if you sell products that are $30 or $50. And above tells you a 3PL about receiving a lot of theory, three pills don’t like doing receiving, that’s part of my questionnaire to ask your 3PL before you commit, if they don’t handle returns, then you might not they might not be a good fit for you.
Ben Donovan 37:37
Okay, and what do you think about this strategy? Because I’ve been thinking about basically doing every other shipment. So one shipment asked, send you know, because we try and order about once a month to keep a regular flow. And so one order send it direct to Amazon, if they’ll let me and then one order send it to a 3PL one order to Amazon one order to 3PL. So it’s kind of like half and half, but it saves the splitting of each ship. Does that sound good? Or am I going crazy? What am I missing?
Afolabi Oyerokun 38:11
If you send directly to Amazon are you sending by LCL? Or you’re sending my air cargo?
Ben Donovan 38:18
Afolabi Oyerokun 38:20
Okay, so you sending LCL directly? Another question is why do you want to why don’t you put everything in 3PL before saying okay, you want to you want to cut out the 3PL side for some products, I think it’s good because I see a lot of customers do that a lot of brands do that. I don’t see any problem with it. Because it’s only that as long as you can time it very well. If you can time it very well create some buffer into your timing, I think it’s going to work, I think, you know, obviously works really well. But if you don’t have, if you don’t time it very well, you can end up with a lot of inventory on Amazon and they will charge you excess storage because 3PL storage is usually cheaper than Amazon for in most cases. And the reaction to market is it’s just a big one for me. You know, let’s say you send stuff to Amazon. And in most it sells really fast and you don’t have anything waiting and your 3PL to react within a one two week period. Then it becomes a problem but it’s a good problem to have.
Ben Donovan 39:37
Yeah, definitely. Definitely. Good. Okay, now that’s helpful. Thank you for that. And I’m sure hopefully it’s helpful for some some of our listeners, I’m just getting a bit of private consultancy here. So appreciate it. Amazing. Listen, we’re coming up to the end of our time together and I know you’re you’re a busy man. So I don’t want to take up too much more of your time but just in terms of if you could sort of summarize your journey and your advice is everything you’ve been talking about today, Is there any kind of final bit of take home advice that you would give to our listeners before we close?
Afolabi Oyerokun 40:09
Well, the way I can rephrase that question is, what will I do differently, if I were to start all over again, having all the bad and good experiences, I think I’ll innovate more, I’m going to protect my innovation, I’m going to automate using tools and software more, I’m going to diversify. So I’m not just going to be heavily reliant on China, I’m going to look at other places, you know, look into wholesale looking to Canada, look into different places, Euro, you know, in Mexico, wherever else I can diversify into. And I’m also going to outsource. So whatever I’m not good at, I’m not going to be Jack of all trades, I’m just going to get the best of the best to handle different parts of my business. And then I’m going to partner up, I found out that businesses that have partners, they grow faster, and they’re more stable. So if you have if you have witnesses, and you have somebody that can complement that, that will be ideal. And the last of everything is to enjoy every single day.
Afolabi Oyerokun 41:22
A lot of a lot of us, you know, quit our day jobs and come to ecommerce, because we wanted freedom, right? And then you get into E commerce and you’re spending 100 hours a week, you know, and there’s no rash. You don’t spend time with your kids. You can spend time with your wife, your family, nothing, you’re always glued to your computer you’re looking at, you know, talking to suppliers talking to vendors. So what’s the point on you know, what’s the point of leaving your day job in the first place, you’re not really enjoying life, you’re not living the kind of life that you had always imagined you’re going to do. So I would say innovate, protect, automate, diversify, outsource partner up and enjoy every single day do not postpone your enjoyment leave. Now.
Ben Donovan 42:10
There’s some value packed advice. There is the best answer. We’ve got to the final question of an episode. Yeah, I think so. You’re a legend. Thanks so much for for sharing your insights with us. And for lobby. It’s really insightful and helpful. And I’m sure there’ll be lots of our listeners that will be wanting to find out more and and get in touch and connect with you. Where’s the best place to do that, obviously, we’ll leave all the details in the show notes in the description. But just for anybody that’s listening on audio, where’s the best place to connect with you?
Afolabi Oyerokun 42:43
The best places to go to our website, honuworldwide.com. That’s H O N U? Worldwide, that’s wo r l d, w i d e.com. Or you can just send us an email at [email protected].
Ben Donovan 42:59
Nice, awesome. So we’ll leave that in the show notes. We’ll also leave the link to you got a new course sourcing mastery, I believe it’s called. So people can people can grab that. And then also the 3PL cheat sheet will live there in in the description as well. Some value to be hard for all of our listeners of a lobby. Thanks for coming on the show today. Really appreciate your time.
Afolabi Oyerokun 43:22
You’re welcome. Thanks so much for having me. I really had a great time. Thanks. And I wish every listener you know, great and successful 2023 and beyond.
Ben Donovan 43:34
That’s amazing. Amazing. Well, thanks everyone for listening as well. I’m sure you got loads of value out of this. Keep on pushing hard in that supply chain. And you know, keep working hard to better yourself. Learn the things Afolabi has been talking about today is a lot to learn there is a lot to get ahold of in the E commerce space. But if you do master it, there’s incredible businesses to be built. So go back listen to this episode. Again. If you need to reach out to Apple lobby, reach out to me if you need any help. We’d love to hear from you. And we’ll see you in the new episode.