Mistakes and Wins I Made Starting My Own Supplement Company
So, you want to start your own nutrition company? I don’t blame you!
The supplement industry is expected to top 60 billion dollars in yearly revenue by 2021 and even a small fraction of that pie could be life changing to say the least.
Starting your own line of supplements is, on one hand, ridiculously easy to do. For under $5,000 you can outsource label creation, work with a manufacturer to develop your own formula, get around 150 bottles (depends on how expensive your creation is to produce), launch a website and start making money.
On the other hand, if you don’t know exactly where to get started, you can end up running in circles, duplicating efforts and flat out getting kicked in the face by the most trivial, mind-boggling things which completely derail your launch.
I know this for a fact, because I’ve been there and done it.
There are a lot of articles online covering everything from how to start your supplement business to how to setup your website for sales. I’ve read most of them and I can tell you from firsthand knowledge, generally speaking, they are either written by a company trying to get your business or they are such broad commonsense overviews, it is of little use.
I’m offering you something different. I’m going to walk you step by step through how I started. What mistakes I made and what I got right.
Why would I do this when it may very well increase the already flooded market with more competition against my own products? Because I’ve been an entrepreneur my whole life. I understand the struggles of starting something great. And I believe a rising tide raises all ships.
I’m helping you because I know the best way to help myself isn’t by guarding knowledge but to freely share it. Call me a firm believer in karma!
In this article, we are going to cover the following 5 steps, which is everything you need to get started.
- Creating a Product People Want
- Finding a Manufacturer that Will Work with a Startup and Help with Fulfillment
- Developing a Logo and Label that Sells Itself
- Starting a Website and Payment Gateway that Won’t Try to Steal Your Profits
Without further ado, let’s get to work!
1. Creating a Product People Want
If you’re reading this article, chances are you already have a product in mind. But is it a product people want to buy? Just because you like it, does not mean enough others will, to make it successful.
This is where we have to test out our idea before we start spending big bucks on it.
I learned this trick from Tim Ferris in the 4-Hour Work Week and it’s absolutely genius and will save you a lot of cash and wasted time whether your idea needs some minor tweaking or a major overhaul.
Advertise your product before you invest time and money in creating a full-blown version of it!
1A. Starting the Product Testing Phase
Open a free website that’s easy to construct a one-page sales template. This can be done on platforms such as Wix. You don’t need anything beautiful for the test. You want it to be functional, simple and get the most important points across which you need to make about your supplement.
A few high-quality pictures, which you can likely obtain for free from a good royalty free picture website such as Pixabay.com should be good enough for the testing phase as well.
You will also need a basic logo put on a container to represent your product. You need people to physically see what it is they will be trying to purchase.
When I started, I made my own on Pixlr which is free to use and very similar to Adobe Photoshop. Since my graphic editing skills are remedial at best, my label was far from pretty but it was good enough for the testing phase.
If you need help in getting a very basic logo and/or need help getting it on a blank black or white supplement container, you can use a cheap service like Logomines for as little as $49.
I would not recommend going with any service over $100 for the initial logo as you will most likely want to replace it with a true, professionally designed logo and label once you’ve proven your concept. That’s going to run in the $300 – $500 range and you’ll want that done from someone who specializes in nutrition labels. More on that in Step 3!
You now have your simple 1-page sales website and a physical manifestation of your bottle represented on said page. What next?
You need a call to action on your website such as a “Buy Now” button for people to click on.
What are they going to buy when you don’t even have an actual product to ship them? NOTHING! The point is to find out how many people are actually interested in clicking on buy now.
The “Buy Now” button is simply going to take them to another page that has a form (Wufoo form is free) saying your product is currently out of stock but they can sign up for the waiting list and be notified as soon as it becomes available.
You’ll want to measure both how many people are landing on the Out of Stock page as well as how many are filling out the form. If people are filling out an out of stock notification form, they are highly interested in what you have to sell!
Even if they are just clicking the Buy Now and landing on your Out of Stock page without filling out the form, you are headed in the right direction and have a product you can work with.
Side Note: You need to have the price clearly pointed out on your sales page. Without a price shown, people are likely to click through just to see the price out of curiosity and you will have no idea if there is actual product interest or not.
1B. Creating Highly Targeted Ads to Test Your Product
Now that your testing page is ready to go, you need to drive highly targeted website traffic to your page. The quickest way to do this is via Facebook Ads.
You can get crazy narrow on your niche. For example, on my first try I wanted to target Men, age 25 – 35 who had an interest in CrossFit or Obstacle Course Racing. Simple and effective to setup for testing interest.
Run $30 – $50 in ads being as specific in your niche as you can be and see what happens. It may warrant more testing or it could be a quick scrap if you drive 50 plus visitors and don’t get a single click through.
My Personal Experience
My first “brilliant” product idea based off a recipe I personally use for both strength and endurance and very unique in terms of combination of ingredients, was a complete flop.
I don’t believe I got a single click on the Buy Now button and I had to completely scrap the idea. On one hand it was a crushing blow. On the other hand, I saved myself a LOT of time, energy and money setting up something there wasn’t enough interest in to make a go of.
My second idea did a little better but I wasn’t getting anywhere close to enough click throughs to warrant investing money into it.
Third try is the charm and I hit the jackpot. Extreme interest! Upwards of 20% of all website visitors clicked on the Buy Now button with my price point clearly shown right above it.
Of course, there is something called “cart abandonment” and most people who click on Buy Now even with the price point clearly shown, will not actually buy your product.
I would add to this, Facebook ads is not the best for actually getting sales of your product either. But the point is to gauge interest at this stage, not necessarily get sales.
I had what I needed, extreme interest. All without spending a dime on building an actual product and just $150 on ads over 3 separate tests.
2. Finding a Reputable Manufacturer that Will Work with a Startup
There is a crazy amount of nutrition manufacturer’s available with a simple google search and I recommend you talk to a lot of them to get a real feel for the process and costs.
That said, it’s hard to find a reputable company which is both an FDA Registered Facility and GMP Certified AND will work with a startup on a tight budget.
Most of these facilities want large initial product orders that can quickly run your startup costs to $10,000 or more. I don’t know about you but for me, even coming up with $5,000 to start a company in a highly competitive industry with no guarantees of success is a scary proposition.
Even if I did have $10,000 plus to get started with, I wanted to hedge my bets and enter the market with as little costs as possible because I was new to the supplier side of the equation and there is going to be costly learning mistakes you did not plan for along the way, no matter how well prepared you are.
I will keep this section short because there isn’t much more to say on it other than make sure you have a reputable manufacturing company AND that they have an insurance policy in place which will cover you while you are growing.
At some point you will need to buy your own insurance but for a startup, it’s an unneeded cost your manufacturer can initially cover which you have to have in place to protect yourself.
My Personal Experience:
After dozens of phone calls and emails, I quickly found out I couldn’t afford to work with most of manufacturing companies. I did receive price quotes from all of them though so I had a very solid understanding of what my product should cost on both the high and low end to produce.
I want to be clear that as I write this, I am not an affiliate, do not own or work for and I am not receiving any profits from either company for mentioning them in this article. Nor have I even told them yet they are going to be getting some positive PR from me.
I am literally handing you this information with no compensation or reward for it, just to help you out.
3. Developing a Logo and Label that Sells Itself
This is going to be extremely quick and to the point but you HAVE to have a professionally design logo and label. This is not optional!
In the world of supplements many buyers make their decision to go with product A, over product B, solely due to the look of the bottle or container. If you do not look amazing, you are going to lose out on a high percentage of potential sales and you may never get your company off the ground floor.
Whatever manufacturing company you decide to work with, should have a hook up for a professional designer who works in the fitness industry and knows what sells (in terms of looks) and what doesn’t.
Unless you personally know someone you want to work with, I suggest you seriously consider using your manufacturer’s recommendation.
After all, your manufacturer wants you to succeed. If you aren’t making money, they aren’t going to keep you as a customer.
My Personal Experience
Expect to pay somewhere between $300 – $500 for a professionally designed logo that makes people say, wow!
4. Starting a Website with a Payment Gateway
that Won’t Ban You or Try to Steal Your Profits
The fact I am even having to write this section brings back horrible memories. There is never ending stream of website platforms designed to help you quickly setup shop and take your product live.
I am not a programmer and have no interest in spending the significant amount of time it takes to become one, so I can have a simple but professional looking website.
Unfortunately for me, I did not have thousands of dollars to plop on someone’s plate and tell them to design and build it for me either. I had to roll up my sleeves and get to work.
Most website platforms have a plethora of point and click options now which will allow you to build something quickly that looks good.
That is not to say you won’t spend a lot of time contacting support because you can’t figure out how to do something simple such as have text aligned a certain way next to a picture.
But it does mean with a bit of elbow grease and patience waiting on replies from a support staff, you can build your own professional looking website for under $200.
If you only have 1 or 2 products to start off with, this can be done in a week. I built mine in 6 days and I own another company which takes up more than 40 hours of my time per week.
Choosing the wrong platform can cost you a ridiculous amount of time because you didn’t read their Terms and Conditions carefully enough.
Now I have a story to tell you so let’s jump straight to my personal experience.
My Personal Experience
How did it all go so wrong so quickly? I had done so much due diligence. Yet somehow, overnight (literally I woke up at 5am to an email that crashed my world) my website went from being a finished first design ready to go live and start sales in 2 days, to a website I couldn’t afford to keep.
How did it happen?
Shopify is one of the biggest web commerce platform online. They have pre-designed templates that are a bit restrictive but professional and easy to use and come fully equipped with a shopping cart and payment gateway connected to one of the biggest and most trusted companies on the planet, Stripe.
After reading several reviews on multiple platforms I decided Shopify was right for me. They even have articles on their own website explaining why they are the best choice for a supplement company to go with.
After a nearly a full week of personally building my website in all the spare time I could muster and setting up the payment gateway, I received an email in the middle of the night which explained to me that supplements are not allowed to use the Stripe payment gateway.
Wow, that’s frustrating right? Not the end of the world but frustrating. I now have to figure out who to connect my Shopify account with so I can accept payments.
A few phone calls and lots of time spent on research into Payment Gateway alternatives, I quickly discovered few companies out there will let a supplement company use their payment gateway without wanting a high percentage of each sale.
This higher percentage is to cover the industry wide rampant returns and cancellations caused by less reputable supplement companies then I or you intend to offer.
I Switched to PayPal or PayPal with Braintree
PayPal has highly competitive fees and no restrictions on supplements so you won’t find yourself paying for ads to drive visitors to your website, then realize one day you’ve been “turned off”.
So, Everything Is Good Now Right?
I thought so! I setup my PayPal account and connected it to my Shopify shopping cart and thought ok, that only took 2 days to get all figured out. Not what I wanted to be doing last minute but not the end of the world right? WRONG!
Reading the fine print with Shopify I quickly discovered they charge a high percentage fee on every item you sell, if you don’t use their already installed platform, Stripe!
That means I would have to pay a fee to PayPal for every item sold, which is only fair since they are the one’s doing the credit card processing, BUT I’d have to pay Shopify a fee for every item sold on top of that.
What that meant to me, is my advertising budget just went right out the window. I was already paying Shopify a monthly fee for their service and now to have to pay them a fee on each sale was too much.
I would never get my company off the ground if I was handing over all of my hard-earned profits to them each time I moved a product.
Making the Switch to Woocommerce and WordPress
I had to buckle down and get back to work finding a new website system. I finally settled on the Woocommerce shopping cart system which does not charge fees and is pretty well limitless in design options thanks to the WordPress platform which is open source.
It also allowed me to quickly and easily integrate with PayPal.
The one drawback is developing the website is a little tougher on WooCommerce, in large part because the templates are not so restrictive.
Of course the bright side is more options to build it how you want.
I used their StoreFront theme which comes free to start with and I ended up spending way too much time trying to force it to accommodate my VERY simple sales page.
After a couple weeks of frustration at being unable to get a few small but important items to align correctly, I changed themes and purchased “Flatsome” from ThemeForest.
Once again, I had some quick learning to do but the theme is simply amazing!
There is certainly a learning curve because there are so many options available but for the most part it is all point and click design. Once you get the basics down, you can quickly and easily build any page however you want.
There are some upgrades you may or may not need to purchase with Woocommerce, like the ability to have subscriptions, but WooCommerce is free and Flatsome is only $59.
You will also need to purchase a host for your website.
Personally, I use WPengine.com. They are lightning fast and I’ve yet to see my website go down or offline for even a second.
A cheaper host may mean unreliability and occasional or even frequent website outages. There is no bigger sales killer than an offline website.
They also work solely with WordPress so there are some additional benefits to them, albeit out of the scope of this article.
Just as import in terms of fast download speeds and great uptime, is they provide you with a free SSL Certificate pre-installed so you do not have to purchase your own!
And there you have it. The simplest, yet most capable all-encompassing website solution for a new startup supplement company that won’t ban you in the middle of the night or hit you with outrageous unexpected fees.
Depending on where you are at in the process of starting your supplement company, this article may have been a mountain of information to try and absorb.
I hope you found it useful and at the same time encouraging.
While you will inevitably make mistakes if this is all new to you as it was for me, you can in fact, with a little bit of luck and a lot of heart, make your dream of owning your own successful supplement product line, become reality.
Let me know in the comments what questions you have I didn’t answer in the article?
Best of luck in your new venture!