But the white-label stuff is so popular because it’s a ready-made product. Benefits (compared to DIY) include:
+ No RnD costs (staff and space, failed designs, prototyping)
+ No plant and equipment required
+ Smaller number of units required initially (no other outlays, so the number you have to sell is smaller)
+ Smaller time between investment and return
Negatives:
+ No innovation in the product
+ No control over manufacturing (quality, methods & materials used)
+ Higher risk of returns from customers (can’t control quality)
+ Higher risk of hurting or killing customers (product malfunction)
+ Loss of reputation due to the above three points (well deserved)
+ Inability to update design based on feedback
+ No control over price. You are at the mercy of your people in China after you’re established.
+ more. It’s a shitty practice if I’m brutally honest.
My point is: those upsides are appealing to both big and small players. No big upfront costs? I can just whack a label on a shiny piece of shit and make 2x ROI? Sweet! Reputation? Couldn’t care less, I’m small-time and can switch up if anything hits the fan.
+ No RnD costs (staff and space, failed designs, prototyping)
+ No plant and equipment required
+ Smaller number of units required initially (no other outlays, so the number you have to sell is smaller)
+ Smaller time between investment and return
Negatives:
+ No innovation in the product
+ No control over manufacturing (quality, methods & materials used)
+ Higher risk of returns from customers (can’t control quality)
+ Higher risk of hurting or killing customers (product malfunction)
+ Loss of reputation due to the above three points (well deserved)
+ Inability to update design based on feedback
+ No control over price. You are at the mercy of your people in China after you’re established.
+ more. It’s a shitty practice if I’m brutally honest.
My point is: those upsides are appealing to both big and small players. No big upfront costs? I can just whack a label on a shiny piece of shit and make 2x ROI? Sweet! Reputation? Couldn’t care less, I’m small-time and can switch up if anything hits the fan.