In our latest podcast, Amy Wees, ex-air force officer and inventor of the Amazon best-selling SiftEast cat litter cleaner, shares a refreshing perspective in today’s China-heavy e-commerce sourcing landscape – why and how she decided to make her products in the USA. 

Watch on YouTube:

Listen on Apple Podcast:

🎙️ Tune in to hear about:

• How to use social media, landing pages, and other tools to gauge demand before investing in manufacturing.

• Taking a “total cost perspective” on domestic v.s. overseas production.

• Weighing profit potential among different e-commerce channels and fulfillment methods.

• Choosing a dominant sales channel for launch based on consumer behavior.

• Amy’s “inventor mindset”

📝 Have a question for or want to share your thoughts? Drop a comment below and let's keep the conversation going!

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If you prefer reading, here is a summary of our conversation:

In today's fast-paced and inflationary environment, validating ideas before diving into development, manufacturing, and launch is paramount for success. 

This blog explores the critical importance of validating concepts before investment, citing the use of social media ads as a prime example to gauge demand before committing resources. 

Understanding consumer behavior, particularly within different niches in the pet space, is crucial for selecting the optimal sales channel. Moreover, maintaining a robust online presence is emphasized, regardless of the chosen sales avenue. 

How to validate ideas before investing in developing, manufacturing, and launching a new product

Before you invest in any manufacturing, it's important to validate consumer demand. This step can save you from expensive mistakes. Design firms charged $30,000 just to turn a sketch into a more detailed drawing. Then, there might be additional costs for molds, websites, and branding, often adding up to hundreds of thousands of dollars before a product is ready to sell. 

Ways to validate a product before launch:

• Social media and “fake” websites make a helpful test. You could run a simple ad featuring your products’ mock-up images. Then, gauge how many people arrive at your landing page and sign up for your “waitlist” or, better yet, complete a pre-sale order. This also helps refine ideas based on real feedback.

• Use survey/polling tools – such as PickFu or PollFish – to define your target audience and have them choose among prospective products. 

• Of course, we could always go back to the old-school consumer interviews and panels used heavily in the FMCG industry.

Made (and packed) in the USA v.s. abroad

When it comes to deciding whether to manufacture domestically or abroad it’s crucial to compare the total logistical costs across the entire value chain instead of just the cost of manufacturing, storing, and packaging of the products. 

Making products in the USA might burn a bigger hole in your pocket, but it's got perks, especially for bulky items. Take Amy's litter box cleaner, for example. Its big plastic sifter is made in Texas—complex and costly, but it made sense for her because shipping large items from overseas is so expensive. Her plastic injection molds cost $42,000 in the USA but only $13,000 in China. However, the total logistical cost of shipping large plastic items from China to the US outweighs all the cost savings achieved at the factory level in China. So in Amy’s case, local production was the move. 

Not all products are created equal when it comes to assembly and packaging in the USA. The challenges of producing items like plastic injection molded products or those with multiple components are notable. Unlike simpler goods such as supplements or skincare products, these complex items require additional handling, kitting, and packaging, which many US manufacturers are hesitant to undertake.

One option is to lean on third-party logistics services for outsourced warehousing, kitting, packaging, shipping, and refunds. But, this convenience could get costly. Amazon’s popular FBA program charges 30~40% of revenue on all products fulfilled by Amazon and upcharges for low-inventory SKUs as well as larger items. Many brands have reported 3PL total costs not dissimilar to that of Amazon.

Amy chose an interesting middle-ground where she manufactures in the US but instead of a 3PL, rents a local warehouse where she and her family could easily access and assemble at costs that are a fraction of outsourced labor. DIY packaging for Amy costs around under a dollar per unit, but if she had outsourced to a 3PL, she would’ve paid close to $6. This drastic difference underscores the importance of understanding the complete cost structure involved in bringing a product to market.

While the allure and credibility of 'Made in America' is undeniable, the decision to really make in America must be balanced against the practicalities of cost, efficiency, and consumer demand.

Selecting a primary channel for launch by understanding consumption behavior. 

With almost any product, there is likely a dominant sales channel that could prime the business for a successful launch. 

For example, fur parents may prefer buying everyday pet essentials from big stores like Amazon and Walmart, where they are already purchasing other essentials for their home.  On the other hand, a trusted neighborhood pet boutique might prevail as the primary sales outlet for freeze-dried raw dog food. 

Interestingly, we learned that for GNight Fetcher’s memorial keepsakes, pet parents prefer to shop online for pet urns because they may not always have the emotional strength to do so in a brick-and-mortar store with others present.

When deciding on your primary sales channel, consider the following:

1. Consumer Trust: Pet parents often prefer purchasing pet essentials or food from well-known platforms such as Amazon, Chewy, or Walmart. For niche, single-SKU brands think eco-friendly bamboo toothbrushes for pets – a dedicated e-commerce website such as Shopify might not be cost-effective or necessary. In certain cases, a branding-focused website built on a cheaper platform, such as Squarespace might suffice. work if you can effectively drive traffic.

2. Marketing Budget: Launching on a platform like Shopify requires substantial investment in traffic and ads. Certain brands may choose to grow Shopify as a secondary channel after a handful of “hero SKUs” have been stress-tested and graduated from third-party e-commerce platforms such as Etsy, TikTok Shop, Instagram Shop, and Amazon. 

3. Consumer Behavior: Conduct thorough market research to understand how pet parents make purchasing decisions for your type of product. For example, Amy’s research on the litter box cleaner revealed that pet owners prefer buying such products from major trusted retailers where they are already shopping for a home and personal cleaning products.

Regardless of the sales channel, an online presence remains almost non-negotiable. A professional-looking website that represents your brand could significantly boost your credibility and serve as a customer touchpoint.

The Bottom Line: Enjoy the view

The most inspiring aspect of Amy's journey is her attitude towards failure. She sees it not as a roadblock but as a stepping stone to growth. From failed products to pivoting business ventures, Amy's resilience shines through. The refreshing mantra, "enjoy the view," serves as a compass through the uncertainties and “grind” of entrepreneurship. Amy reminds us that just like raising a child, building a business doesn't come with a manual. It's about embracing the challenges, learning from mistakes, and finding joy in the process of invention.

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