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November 2, 2019

ABOUT 101 COMMERCE

101 Commerce is a next-generation CPG company owning a portfolio of microbrands that sell exclusively through the Amazon FBA program. Backed by the investors and executives behind HomeAway, IGN, and Dollar Shave Club, this internationally distributed team aims to become the first billion-dollar company leveraging Amazon FBA.

“I'd recommend Gembah to any company importing more than a handful of products. They speed up and simplify production, and add an extra layer of security.”

-Will Freeman, Senior Director of Product Development, 101 Commerce

CHALLENGES

1. Working in Chinese Business Hours

Prior to working with Gembah, 101 Commerce Senior Director Will Freeman had to work every day across multiple time zones while interacting with Chinese suppliers and manufacturers. 

“It was too much, I had to be on 16 hours a day working,” Will recalls. “That was one of the reasons we started looking for an outside entity to handle sourcing.”

2. Gaining More Competitive Pricing

Beyond the long hours communicating to factories in China, they ran into other bandwidth issues. 101 Commerce had over 1,000 existing SKUs they sought to increase the margins on and in some cases also tweak the items. Their team didn’t have the time to renegotiate pricing or find suppliers they can trust.

They first tried a leading online source platform for product sourcing to improve their margins. Along with not being customized in any way to their business, 101 Commerce found:

 

  • The process to submit a quote was a similar experience to working with Alibaba
  • Their sourcing solutions didn’t provide better pricing or cultivate any relationships with the factories that would produce for them
  • They weren’t going to do any QC or factory visits
  • Their services were expensive

“They were asking for 1K a month to provide no benefit in my opinion,” Will explains.

Then 101 Commerce tried working with another sourcing agency that marketed themselves as specializing in textiles and other products. It took over a month to get the first manufacturing quote back from the agency. The quoted price was higher than what they were already paying.

3. Scaling Faster

After those experiences, they realized they needed to work with a more transparent and responsive team. They also required an end-to-end service offering to help them scale quicker. 101 Commerce needed assistance with:

  • Product design for SKU updates and new items 
  • Identifying and negotiating with factories
  • Quality control of products
  • Maintaining relationships with overseas factories
  • Expediting the product sourcing and sampling process

SOLUTIONS

In January 2019, they tested the waters working with Gembah. The initial contract piloted Gembah’s product design and sourcing solutions.

“Gembah has a different model. They’re active and provide more personalized services,” Will says. “They asked us what we needed and adjusted accordingly.”

In just a few months into their partnership, 101 Commerce found a number of key benefits.

1. Exclusive Network of Factories

Gembah works closely with a network of factories and stays in constant communication with them on behalf of retailers.

“Gembah sources factories mostly through personal relationships. I lived in China for 12 years so I understand how the system works there-having an introduction come from friends really helps,” Will says. “That way the factory is accountable to someone they value rather than just a written contract, which often holds little weight in China.”

101 Commerce also enjoys a transparent partnership with Gembah. They don’t have to worry about any conflicts of interest such as kickback fees from factories, unlike some Chinese sourcing agencies.

“Gembah tells you how they know suppliers and where they’re located. If you want to go talk to or visit them it’s cool,” Will says. “It takes a lot of weight off our shoulders knowing that.”

2. Smarter Product Development

Gembah also has team members based in China, to give customers a presence in China that works with factories during their business hours. This not only helps with building relationships but also more streamlined QC.

The Gembah team in China reviews samples of new products to check sizing, durability, and other important facets. This way instead of waiting on international transit times to receive samples, 101 Commerce can iterate and list items on Amazon faster.

“Gembah just speeds up the process by being on the ground and doing QC,” Will says. “Being able to talk to people there the same day speeds up sourcing, testing, and sampling.”

101 Commerce’s new product ideas come from a wide range of data points. They may have a trending item or an opportunity to market a product in new countries. Or for more complex items with multiple component options, they have big decisions like making an item battery-operated or a plug-in device.

In each of these scenarios, getting quickly to market is key. Gembah helps them make a more informed decision faster. Within five business days, they gather quotes from their network of factories and provide the best options based on their preferences and business goals.

3. Price-Optimized Sourcing

Once 101 Commerce acquires a new microbrand for their portfolio, Gembah also works with them to identify how they can increase their margins. Whether it’s sourcing a new factory or renegotiating the expenses with their current manufacturer, Gembah consistently provides them more savings than they were able to get on their own.

“They can deal with price negotiations better than we can,” Will says. “Where we know we can get 30% margins, they’ll get us even better pricing.”

RESULTS

Since partnering with Gembah to get their portfolio of items expertly designed and manufactured, 101 Commerce has been able to get new products from initial concept to on sale at Amazon in as little as four months. Thanks in part to Gembah, they also flourish with:

1 %
Average Lower Production Price
1
Business Days To Receive Quotes
1 +%
Average Product Margins

Moving forward Gembah will play a key role in their continued expansion as 101 Commerce aims to sell in over 200 countries and scale 101 retail microbrands.

“I’d recommend Gembah to any company importing more than a handful of products,” Will says. “They speed up and simplify production, and add an extra layer of security.”

READY TO MAKE THAT IDEA A REALITY?

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