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Private Label Nightmares – What not to do

23 Feb 2016

Do the research, so it doesn’t bite you back years down the line.

Both of these are present day events…

Case Study 1:
Lumber Liquidators sourced from China..shares have fallen over 83% since last year.
http://www.winknews.com/…/lumber-liquidators-stock-plunges…/

Case Study 2:
Hoverboards – sourced from China – now forced to halt distribution

-$1,600,000 Worth of hover boards seized by U.S Customs
http://counton2.com/…/1-6m-worth-of-counterfeit-hoverboard…/
-This is a big private label outfit making these mistakes
http://www.chicagotribune.com/…/ct-hoverboard-seizures-met-…
-16,000 hoverboards seized – counterfit – over 6M

“Some hoverboards came from an ocean container, while others were discovered in air shipments, Ferrara said. A number of shippers and importers were involved.”

Sound familiar? ocean containers…air shipments.. this is sourcing gone wrong.

Lessons Learned:
-Be wary of chemical based products.
-Be wary of lithium based products.
-Always be very knowledgeable in what you are buying and distributing to -your customers (humans), or (pets -animals).
-Any type of product that can potentially harm a human, has major liability, and a chance of a company imploding due to public awareness.
-Don’t create products that are someone else’s brand (common sense, but obviously people with lots of money forget)

Robert Weisberg When I was in China I saw the hoverboards. While I did not expect some of the issues that happened with it, I could clearly see that sort of item can bring grief. Grief and huge losses.

Kapil Ochani I also read about hoverboards getting really hot and then burning. Never could have imagined that. These were really popular during Christmas and they will still be when Christmas comes. Its just a matter of who makes them with high quality this time. They were quite expensive to source as well. Thanks David Aladdin for sharing your lessons learned. They surely are the ones to keep in mind while sourcing.

Dotti Templeton I’ve only sourced in the US so far, but am planning my next product will be from India.

Robert Weisberg These sort of items bring undue risk. Keep in mind when/if they are pulled completely by Amazon a rookie seller can be out hundreds of thousands. Furthermore the customer can get a refund at any time for a broken unit. Anyone without a strong stomach and alot of money can be wiped out with these sort of things.

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