93: Sourcing in China with David Hoffmann (Part 2)
David Hoffman is your guy in China. He's a total expert in everything Chinese, and a specialist in eliminating quality control problems that most companies face when sourcing in China.
In this episode, David shares some fascinating secrets including how big brands source from the Far East, how Apple made concessions for WeChat and the key to success when trying to build a product in China. Plus David peppers the conversations with compelling stories and anecdotes.
My Guest: David Hoffmann
David is a serial entrepreneur building multi-million dollar companies. He has led the international trade powerhouse Global Regency (shipping products over $200m p.a to over 40 countries) as CEO for over 15 years, and is considered an expert in China sourcing, supply chain, private label, and brand licensing.
In 2016 David launched GlobalTQM.com under the Global Regency umbrella, after he saw an incredible opportunity through helping friends and family to assist SMEs, start-ups, and entrepreneurs with quality management issues and sourcing from China with a range of educational and mentoring programs and actual done-for-you services with his resources of +57 people in China.
Experienced in business, operations, automation, digital marketing, David’s single biggest skill is his ability to master productivity and share the experience.
[02:14] You literally wake up every day stressing because you've got so much business going on and so many responsibilities and obligations around it, that you start going, "But why did I want that in the first place?"
[11:40] We tried to launch our own clothing brand, which was a mess of mistake.... what I realized is that we don't know a whole bunch about clothing. You need different sizes for every single color, so the amount of SKUs you need is insane... that was our one massive mess of oversight. And then the other oversight we had, was that it was the first time we got involved in a business, that we're kind of relying on social media to drop sales.
[20:32] I get an email that's been messed around for two and a half months on a sample. They are trying to get a sample from a factory and they're getting so frustrated. I called Jenny, one of the girls that worked for me, she speaks Chinese, she lives in Chinese. And I said, Jenny, "Do me a favor, can you just call this factory and find out what the hell's going on." She comes back 10 minutes later, "They're sending the sample to our office this afternoon. He didn't understand what the client was asking about." He was as confused as they were for two months.
[24:51] The reality is, if you're in the product business and you want to build a product or sell a product, it's got to reflect you, and that means:
-You getting on a plane
-Finding products you like
-You talking to the suppliers and trying to explain to them what changes you want to make.
It's very hard to translate that through a middleman.
[33:27] Apple even had to make a concession for WeChat. Because within the WeChat ecosystem, you can download other apps... There's no chance you can exist in China without WeChat it's like oxygen.
[40:51] There's definitely different places for different things. Vietnam is very good at ceramics and housewares and things like that, and they work well with some materials like bamboo. It's like a kind of a craft and a skill that they've developed. Bangladesh is great for clothing and fabrics. In fact a lot of the clothing industry is bought from there. Cambodia is becoming better and better for fabrics. I think China's still the best for consumer electronics.
[43:04] Where I'm struggling at the moment is actually in the digital marketing space. We haven't had to do that before in terms of promoting services and creating trust with clients.
If somebody can explain it to you in under a minute, they don't understand it well enough.
Please note: This episode was recorded before the outbreak of COVID-19.
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