#395 - Mastering the Art of Supplier Negotiation and Sourcing with Lyden Smithers

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May 16, 2024

Join Lyden Smithers, an Amazon seller and negotiation expert who guides sellers through supplier negotiations. He shares his transformative journey from novice to negotiation wizard, revealing a six-step strategy for achieving win-win outcomes. Delve into the complexities of sourcing in China and the significance of building trustful supplier relationships. Learn how to craft unique products, protect intellectual property, and navigate global sourcing challenges, all while emphasizing the vital role of community in seller success.

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ANECDOTE

First Amazon Success - Dog Clippers

Leiden Smithers shares how he first succeeded with dog nail clippers on Amazon, achieving bestseller badges in eight countries.
Despite this, he learned the crucial lesson of truly understanding numbers as six of those markets lost money.

ADVICE

Strategic Supplier Negotiation Approach

Prepare by understanding your numbers and showing suppliers current and forecasted order volumes.
Present how better payment terms grow your orders, making it a win-win deal.

ANECDOTE

Building Supplier Trust In Person

Meeting suppliers in person in China led to excellent payment terms: 20% deposit, 80% paid 180 days later.
Good supplier relationships help during stock shortages and grow mutual business success.

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Join the remarkable Lyden Smithers and myself as we embark on an explorative journey into the world of master negotiations and strategic sourcing. Lyden, unfolds his transition from a novice Amazon seller to a negotiation wizard capable of securing the best supplier terms. Harnessing the power of preparation and financial knowledge, we dissect his proprietary six-step strategy that takes negotiation talks beyond surface-level discussions, aiming for growth-driven, mutually beneficial outcomes. Witness how his personal growth, transformed him from a hesitant speaker to an influential global presence, and soak in the tales of leading China Magic trips that embody the spirit of true product engagement and supplier relationships.

Venturing into the realm of sourcing, we tackle the complexities of navigating China's manufacturing landscape, comparing it to the business infrastructure in the UK and US. I recount firsthand experiences and strategies that reveal China's unparalleled capabilities, even for smaller-scale orders, and discuss the delicate balance of fostering lasting, win-win partnerships with suppliers. Stepping further into innovation, we examine the tactical moves necessary for crafting unique products and securing coveted exclusivity deals, emphasizing the significant role of strong factory relationships and the art of protecting one's intellectual property while maintaining a competitive edge.

As we close the episode, we pivot towards the pursuit of business profitability and the nuanced strategies that can lead to a lucrative exit. He’ll share insights into optimizing financial metrics such as EBITDA margins, COGS, and advertising spending, all while keeping an eye on the broader picture of portfolio profitability. The conversation wraps up with a look at the rise of TikTok Shop in the e-commerce ecosystem and the immeasurable value of community in accelerating business growth. Finally, a gentle reminder that a well-curated mental diet, rich in quality information, is as vital to your success as the nourishment you choose for your body.

In episode 395 of the AM/PM Podcast, Kevin and Lyden discuss:

11:05 - Navigating Supplier Negotiations Successfully
16:50 - Building Relationships in International Business
19:00 - Challenges With Production Costs
22:09 - Sourcing Challenges in Global Market
30:07 - Product Development for Better Pricing
33:49 - Navigating Innovation and Supplier Relationships
36:04 - Product Development Supplier Relationships
42:04 - Identifying the Biggest Wastes
40:18 - Strategies for Business Profitability and Growth
45:56 - Portfolio Optimization Through Quintile Analysis
49:39 - Diversifying E-Commerce Market Strategies
50:42 - Mastering Amazon and Building Communities
52:53 - Importance of Like-Minded Networks
57:00 - Kevin King's Words Of Wisdom