How to develop and manufacture new products in China? (Example of new product development process)

Step 1: How to Spark New Product Ideas?

A. Innovative products that open up markets

l Fingertip gyroscope case study: this popular little toy swept the globe in 2017, crossing age and species boundaries to become a favorite gadget. However, its inventor, Catherine Hettinger, missed the opportunity to turn it into a business empire because she couldn’t afford to pay the $400 annual patent maintenance fee. Had she been able to master the production process in China, she might have been a billionaire.

 

   

 

l Inflatable Recliner Success Story: This recliner is widely recognized for its portability and versatility. Whether you are having an outdoor picnic, resting indoors, waiting for a flight or taking a short nap, the inflatable recliner is the ideal companion. Its ability to quickly capture the market not only enhances the brand image, but also gives it an edge over the competition. But remember, well-planned marketing is equally indispensable to ensure that the product spreads quickly.

 

 

Challenges and risks:

Innovative products, while full of potential, come with significant risks. They require high R&D investments, long testing cycles, and the courage to face market uncertainty. It is always important to keep an eye on consumer acceptance before a product becomes a breakout hit.

 

Recommendation:

With a limited budget or uncertain market response, it is wise to choose products that are less expensive and easier to manufacture. Try to avoid costly plastic molds or reduce mold costs by simplifying the design.

B. Improve existing products to optimize user experience

In the world of product development, making improvements to existing products is the preferred strategy of many innovators. Successful sellers on Amazon often specialize in selling such improved products.

l The innovative design of the beer bottle cover: this design not only eliminates the hassle of carrying a bottle opener, but also makes outdoor drinking more convenient.

l Stylish and Practical Multi-Layer Diaper Bag: Designed for mothers, this diaper bag is moderately sized and is both stylish and practical. A variety of styles to choose from, allowing mothers to meet their daily needs while also showing their personality.

l The convenient experience of a self-stirring coffee mug: This coffee mug offers unprecedented convenience for office workers with its self-stirring function. No need to look for a spoon, you can enjoy delicious coffee at the touch of a button.

           

 

 

Advantage Analysis:

The biggest advantage of improved products is that they can be developed based on an existing product base, thus saving a lot of R&D costs and time. Innovators are facilitated by the fact that numerous factories in China offer stable and economical production of mature products. With an in-depth understanding of market needs, innovators can make more targeted product improvements, increasing the likelihood of success.

 

Potential Problem:

While improved products may not have the same profit margins as brand new products, they also face the risk of patent infringement. Before developing, be sure to ensure that the target product is protected by patents and that your improvement program circumvents patent restrictions.

 

Suggestion:

Focus on the inconveniences of everyday life and draw inspiration from them. At the same time, stay sensitive to the market and understand the real needs of consumers. In the process of product development, focus on ease of use and practicality and avoid overly complex designs. In addition, patent issues should not be ignored to ensure that your ideas do not infringe on others’ intellectual property rights.

 

Step 2: Prepare prototype or design documentation to contact Chinese suppliers

 

Before establishing contact with a Chinese supplier, it is crucial to prepare a thorough prototype or design document. This not only demonstrates your professionalism and seriousness about the project, but also effectively communicates your product requirements and ensures that the supplier can accurately understand and meet your expectations.

 

How to get a new product 3D design or prototype?

** **

A. Have a ready-made 3D design

Importance: A complete 3D design is the cornerstone of presenting your product vision to suppliers. It not only helps suppliers understand the product’s appearance, structure and function, but also serves as a blueprint for subsequent production and manufacturing.

 

**Design process: **Hire a professional designer to create a 3D design drawing based on your idea. During this process, you may find some design implausibilities and make them better through repeated revisions.

 

**Validation of idea: **3D design drawing is the first step to validate whether your idea is feasible or not. It lets you see the product in action from a virtual perspective, which helps you make adjustments and optimizations.

 

Increase confidence: Having a detailed 3D design drawing will give you more confidence when discussing with your suppliers because you already have an in-depth understanding of the product.

 

B. Seek assistance from a product development company to create a prototype

3D Printing Technology: Once the 3D design drawing is complete, you can quickly create a prototype using 3D printing technology. This helps you visualize the size, look, and feel of the product more intuitively.

 

Choosing a partner: Look for an experienced product development company that not only offers 3D design services, but also follows up with prototyping. Sometimes, freelance designers may also have such resources and can offer more favorable rates.

 

**Agreement signing: **When signing an agreement with a designer or product development company, make it clear whether you have plans to make prototypes and reserve the right to make subsequent changes. This ensures that you will still be supported as your needs change.

 

**Factory support services: **While a product development company may offer factory support services, this usually means higher costs. Unless you are on a budget and on a tight timeline, it is advisable to independently search for a suitable manufacturing plant.

 

 

Step 3: Finding the right supplier to manufacture your product

 

There are several key steps and considerations you need to be aware of when looking for the right supplier to manufacture your products. Below is a detailed guide to help you find the right supplier in China.

 

A. Prepare a Non-Disclosure Agreement (NDA)

Importance: A Non-Disclosure Agreement (NDA) is key to protecting your creative ideas and trade secrets. It ensures that your product information, packaging information, order information, etc. will not be disclosed to competitors.

 

**What to include:**The NDA should contain your company information, product information, packaging information, order information and other key elements.

 

**Who to sign: **The NDA must be signed with the final manufacturer. If you are working through a purchasing agent, the agreement needs to be signed by both the agent and the factory.

 

B. Choosing the Right Type of Supplier

 

**Factory: **If your product is simple in structure, does not require complex combinations of components (e.g., only dealing with variations of a single material), and you have a budget that can accommodate a high minimum order quantity, then working directly with a Chinese factory may be a suitable option.

 

**Pros: **Lower price, suitable for high volume production.

 

Cons: Possible lack of focus on the final market suitability of the product, higher MOQs.

 

 

 

Product characteristics not suitable for direct factory production:

l **COMPLEX ASSEMBLY: **If your new product requires multiple components to be assembled into a finished product (e.g., perfume bottles, including glass bottles, aerosol dispensers, and lids).

**Packaging Design: **Appropriate packaging design is needed to protect and display the product.

Customization of small quantities: Smaller quantities are purchased, but a lot of adjustments need to be made to the product.

 

In these cases, factories may not be the best choice as they may lack the patience to meet your diverse needs.

 

l Trading companies: specialize in handling combined products, lower minimum order quantities, and can combine your orders with those of other customers.

**Pros: **flexibility, ability to handle complex products, lower MOQs.

**Disadvantages: **may increase intermediate links, resulting in higher costs.

 

l **Purchasing Agent: **If you are not familiar with the import process or are not sure which supplier is right for your order, a purchasing agent is a good choice.

Advantages: localized operation, better understanding of factories, able to find suitable factories for you continuously.

**Disadvantages: **may increase a certain service fee.

 

Why choose a sourcing agent instead of a factory or trading company:

If you are unfamiliar with the import process or are unsure which factory or trading company is best suited for your order, it may be wise to find a Chinese sourcing agent to handle your request.

The sourcing agent will continue to search for suitable factories for you until they find a satisfactory partner based on your cost and quality requirements. As they operate locally, they have a deeper understanding of the factory and can communicate and facilitate more effectively.

 

Example: If a factory’s origin requires a minimum order quantity of $5,000, a sourcing agent may be able to find a way to get it down to $1,000.

Sourcing agents can also help when you are unsure of the specific needs of a product line for a product. For example, it may not be appropriate to look for a factory that makes pool inflatables to produce inflatable lounge chairs, but a good sourcing agent will find you a fabric/bag factory to manage polyester fiber production.

 

C. Key points in deciding on suppliers

 

a. Price: Price is an important factor, but don’t just go for the lowest price. You need to balance price, quality and the patience and experience of the supplier.

 

b. Quality of samples: The quality of samples usually determines the quality of mass production. Don’t believe the supplier’s excuse that “the samples are bad, but the mass production will be fine”. Don’t place an order until you are satisfied with the sample.

 

c. **Good communication: **A good supplier should focus on understanding your needs and be willing to help improve the product. Choose suppliers who write good English, respond promptly, and are willing to conduct online and video chats.

 

d. Other considerations:

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Minimum Order Quantity (MOQ): Try to get a lower MOQ and try to get more color options for the same price.

 

Mold Making Time: Know the timeline for mold making and sample production so that you can schedule timely follow-ups.

 

Mold Pickup Rights: Ensure that you have the right to pick up the molds in case you are not satisfied with the quality of the samples.

 

Sample fee/mold fee refund: Discuss with the supplier about the possibility of refund after reaching a certain quantity and sign an agreement.

 

Factory qualification and certification: Ask the supplier if they have obtained ISO 9001 / BSCI / ISO 14001 / OHSAS 18001 certifications to ensure stable and reliable product quality.

 

 

Step 4: Refined project costing and retail price setting

 

Accurate costing is a central part of evaluating a product’s marketability before it goes to market. Here are the cost breakdowns you need to scrutinize:

 

A. Pre-Production Costs:

**Prototyping costs: **Cover the cost of design, 3D printing and handcrafting.

 

**Tooling Costs: **Avoid plastic tooling where possible to avoid adding an extra $2,000 to your budget.

 

**Testing Costs: **Identify which tests are mandatory and which are optional to minimize unnecessary investment.

 

FDA Registration Costs: This cost is required if the product is to be sold in the United States.

 

**Sample and Courier Costs: **Courier costs for samples can be much higher than the samples themselves, e.g. a mirror can cost $300 to courier, while the sample cost is only $60.

 

Patent and brand registration costs: If you have the budget, consider filing a PCT patent application. It is often advisable to start with protection in the main countries of sale and gradually increase the scope of protection as sales expand.

 

B. Costs in the production process:

**Product cost: **This is the most central part of the whole project.

 

**Internal Packaging Costs: **Quality packaging not only enhances the market value of the product, but also improves the protection of the product. For example, an iPhone box costs about $2 to produce.

 

Outer Packaging Costs: If the product is to be packaged in a separate outer box and sent to the consumer via courier, a drop test should be conducted to ensure the reliability of the packaging.

 

Combination Packaging Costs: If the product is a combination of components from multiple factories, this cost will be included in the total cost.

 

**Production wastage: **This will affect the final costing, taking into account the unavoidable rate of defects during the production process.

 

C. Post-Production Costs:

**Transportation cost: **many buyers ignore transportation cost during production, which may lead to profit being cut drastically. Please research thoroughly and choose the transportation method that suits your needs.

 

Transportation loss: Especially for fragile products, such as glass products, you need to pay special attention to the loss during transportation and reserve a certain loss rate in the cost.

 

First shipment quantity control: For fragile products, it is recommended to reduce the quantity of the first shipment, test and optimize the packaging to reduce the loss rate.

 

**Warehouse Management Costs: **If you have a reasonably priced warehouse, you can consider buying more goods at once to reduce costs. If you don’t have a suitable warehouse or the price is high, consider keeping more inventory in the factory and shipping on demand.

 

Marketing Costs: Budget your marketing costs for Amazon, SNS ads, Google SEM, etc. and spread them over the cost of each product. This is an important part of determining the retail price of your product.

 

 

After all the costing is done, you need to plan the retail price of your products to ensure that they are competitive and profitable in the market. This step requires careful planning and precise calculations to ensure the successful promotion and sale of your new product.

 

Step 5: Customize samples in preparation for mass production

 

After ensuring that the product is cost effective and expected to be profitable in the marketplace, you are ready to proceed with the customization of pre-production samples. This step is crucial because it is not only about the inspection of the samples, but also about the quality, appearance and functionality of the product. You can utilize this opportunity to sell your product to distribution customers in advance, months before the bulk shipment arrives at the port.

 

Here are some key points to assist you in this step:

A. Clarify product materials and production techniques

 

Please note that pre-production samples are different from prototypes in that it is necessary to define the actual production process and materials. Prototypes may be used as a reference only, and even prototypes made using 3D printing technology may be made of different materials than those used in mass production. You need to have an in-depth discussion with the factory or supplier who has the experience to advise on material selection and production techniques to help control product quality, costs, and reduce defect rates.

 

As an example, in our automatic mixing bottle project with a US customer, the prototype was made by a US company using higher cost US components. We helped the customer work with a Chinese factory to redesign the circuit boards while maintaining the same functional requirements, and all components were manufactured in China, successfully reducing the cost by 50%.

 

B. Managing the volume and diversity of pre-production samples

 

For metal, glass or plastic products that require custom molds, making samples on demand may not be practical because it requires the factory to pause the production line to test the molds and make samples. Therefore, you should ask the factory to make more samples early in production in order to schedule a meeting with you.

 

For products such as fabrics or bags, it is relatively easy to make samples as most of the process is done by hand. However, if you need more samples, the cost may be much higher than in mass production.

 

C. Product improvement based on pre-production samples

 

After receiving the pre-production samples, test and try them out and invite your family and friends to participate in the testing. Collect all their feedback and comments, especially negative comments. If these negative comments are justified, you should solve the problems at this stage instead of waiting for mass production to take action.

 

In addition, some experienced suppliers who make pre-production samples will provide feedback based on their experience, pointing out areas that may need improvement.

 

Step 6: Choose the right private label and packaging solution

 

Quality packaging design and materials can significantly increase the value of your product and help sell it at a higher retail price. Therefore, don’t skimp on cost when it comes to packaging design and find the right designer to accomplish a great design that matches what you put into your product.

 

Here are three key questions that customers often encounter when choosing a private label:

A. How does the brand identity apply to the product and its benefits?

 

l **Screen Printing: **This is a commercially viable way to implement logos, but you need to pay attention to the quality of the printing, as poor quality screen printing is prone to peeling off.

 

l Heat transfer printing: Suitable for designs that require multi-color representation, the printed film is transferred to the product by heat. Note that a custom bronze mold is required for each color, costing about $100-150, depending on the size of the printed area and requiring a certain MOQ.

 

l **Embroidery: **Suitable for fabric products, complex logo graphics will add to the cost.

 

l Laser Engraving: Suitable for metal, wood or acrylic surfaces, provides a natural, high-end look that won’t fade or peel, no mold costs, and low starting costs.

 

l Woven labels: Suitable for textiles, supports a high quality appearance.

 

B. Individual Packaging Selection Points?

 

For most new products, color boxes are the preferred choice for stand-alone packaging, which not only has a high-end look, but also provides excellent product protection.

 

Key points to keep in mind when customizing color boxes include:

 

l Opening method: lid and tray type or normal opening type.

l Material: corrugated or cardboard.

l **Insert support (optional): **blister, foam or paper card material.

l **Color box design: **accurate dimensional data is required from the supplier.

l **Color box samples: **Confirm print color, size and other details before production.

 

 

 

C. Other Packaging Options to Showcase Product Value?

The packaging industry offers a variety of style options to enhance the value of your product, such as canvas bags, plastic gift bags, kraft cans, and more. Choose the material that expresses the idea of the product and make it a package that enhances the marketing effect.

 

Step 7: Launch product marketing with pre-production samples

 

In today’s market with a wide range of products, marketing is undoubtedly one of the key factors that determine the success or failure of a new product.

 

Based on our practical experience, here are some suggestions:

A. Build a compelling brand story.

Consumers love stories, and they enjoy learning about a product from design to final presentation. Try to incorporate these story elements into the package design to enhance the integrity and appeal of the story.

 

B. Launch marketing as soon as pre-production samples arrive.

Don’t wait until a large shipment arrives at the warehouse to begin a marketing campaign; doing so wastes valuable time and increases inventory costs.

We have observed that many of our clients who successfully bring new products to market begin selling at the finished product pilot sample stage by bringing samples to trade shows or arranging demonstrations and pitching them to multiple channel distributors.

 

C. Disseminate marketing messages through multiple channels to the extent that your budget allows.

An effective strategy is to prepare a complete set of advertising materials (including photos, videos, and flyers) and make them available as soon as a distributor expresses interest in selling in order to speed up the dissemination of the marketing message.

As the marketing campaign progresses, you may receive your first orders. At this point, evaluate whether you need to increase the number of first orders to meet higher sales expectations.

 

D. Register an exclusive domain name and set up an online store.

It is highly recommended that you register an exclusive domain name for your brand with a domain name registrar such as Godaddy.com, which will greatly enhance the market reach of your product.

If you want your customers to buy your products online, you can open an online store on e-commerce platforms such as 3dcart.com, which offer full guidance on hosting, design, pricing, payment options, marketing tools and reporting features.

It is also recommended that you set up a store on Tiktok, which will not only drive traffic to you but also provide a complete selling experience.

 

 

Step 8: Ensure Intellectual Property Protection and Compliance Certification

 

Intellectual property protection and product compliance certification are two crucial aspects in the process of bringing a product to market.

 

A. Apply for a product patent

Patents can buy your new product a longer period of high profitability, as it takes time for competitors to conceptualize and manufacture a product that is significantly different from your design.

You can choose to apply for a patent only in the country where you sell, or in both China and other countries. If you have a sourcing agent in China, they can utilize the Chinese patent to prevent small factories from copying your product, thus protecting your market exclusivity and maintaining price stability.

 

B. Trademark Registration

Trademarks are important to protect your brand from infringement. Currently, the trademark registration process is relatively simple. Please consult your country’s registry for detailed information and be aware of the examination time during the registration process.

 

C. Signed agreements to control molds

Since the mold is part of your investment, you should have complete control. If you are working directly with a factory, make sure that they properly pack and seal the molds at the end of production (you can ask for photos of when they are packed and sealed).

If you place orders through a trading company or purchasing agent, make sure they hold the molds for you and do not leave them at the factory to prevent unauthorized duplication.

 

D. Obtaining Compliance Certifications for Target Sales Countries

For categories such as toys, electronics, cosmetics and medical products, most countries have specific compliance certification requirements that must be strictly adhered to during customs inspection and clearance at the destination port.

To avoid shipments being blocked at customs and causing unpredictable losses, make sure you have all necessary compliance certifications ready before production is completed. Different countries may require different compliance certificates, for example, the US may require CPSC, FCC certification, while Saudi Arabia may require COC certification.

 

Step 9: Launch the full-scale production phase

After careful preparations and efforts in the early stages, you have finally come to the stage of mass production of your new product. This marks the point at which your product officially enters the market and begins to generate revenue for you.

 

During this critical phase of production, you will need to constantly monitor product quality and ensure that delivery schedules are adhered to. At the same time, you need to start contacting freight forwarders to arrange for the transportation of your products.

 

In conclusion

What parts of today’s guide do you still have questions about or find unclear? Are there specific steps that you would like more details on?

Whether you have any questions or need further explanation, please feel free to contact us. We’re always here to help and make sure you get the support you need.