Leader Bag Co is all about transparency. We love to share what we do and what we have learned. It is important to us that you know about our successes and our missteps. Perhaps knowing our story will help you wherever you are in your journey, be it as a parent, business owner or, ya know, just generally #adulting.
This is a big one. Deep breaths, people. Deep breaths.
Before we dive in, I highly recommend that you go watch this fantastic talk by Matt + Carrie Eddmenson, founders of Imogene+Willie.
I should preface this whole thing by saying… If you're reading this and you're considering manufacturing in the USA vs overseas, I can't tell you that anything Leader Bag Co does as a company will work 100% for you. I can't tell you that one way is better than the other, or that one is less confusing. All I can share is what we decided to do and why we did it… and what the results have been like.
The other thing I should point out is that I'm not going to point fingers or speak ill of anyone here. We have learned invaluable lessons from each partnership we've entered on the manufacturing side of the business. On top of that, we CHOSE these partners after careful consideration - they're great people and companies, some just didn't pan out the way we expected. In that spirit, I'm going to withhold the actual names of the manufacturers. Obviously, if you're interested, just shoot us an email at firstname.lastname@example.org and we'd be happy to answer any questions.
Let's get to it.
When we founded Leader Bag Co, we knew we wanted to build the business around FAMILY. Not only did we want to redefine the responsibility of carrying a diaper bag to a shared, family responsibility, we also wanted to be able to support families from a business perspective. With that in mind, we were determined to use as many USA business partners as we could. This included our printers, sourcing our materials and our manufacturing.
First stop was hiring a manufacturer in New Jersey. Jay (you can read more about him here) had heard about a particular company that specialized in manufacturing for huge accounts - like the U.S. Army. Our response: "What could be more American than that?" We worked with (read: paid $$$) this manufacturer to produce a few rounds of samples of our design based on technical drawings Jay provided.
Although we were ecstatic to see our vision come to life, these first samples probably should have been our first red flag. There was a raw quality that we loved, but unfortunately, that translated in “unfinished" manufacturing techniques too. We were reassured over and over that it was “sample quality" and that the finished product would be much higher quality. But - spoiler alert - it wasn't. It was partially our fault. We were asking a manufacturer that specialized in pumping out simple designs in huge quantities to generate a high-end leather and canvas backpack. They just didn't have the skill to pull off what we needed, but unfortunately, we found that out a little late.
We placed our first order and handed them money (we're self-funded, by the way). Shortly after, we launched the website and started selling… and the response was AWESOME. It seemed like our bag launched at exactly the time when the diaper bag industry needed a hard reset. People loved it. And even though the price tag was high (read: manufacturing in the US is EXPENSIVE… about 6x more expensive according to various sources I think I've probably read somewhere), people were still featuring it in magazines, in blog articles, on instagram… and they were purchasing it.
Amazing. But then the scary emails started trickling in… a shoulder strap broke off. The stroller strap clasp wasn't open. The snap was unsnapping itself on the top flap. Stitches were coming undone. It wasn't ALL of the bags, but enough of them that we started to worry about our business actually failing right out of the gate.
It was a nightmare. Meghan still has PTSD from the trauma, I think. We felt absolutely awful that these bags people had paid so much money for were just falling apart. It was sickening. We knew something would have to change.
We started looking for another manufacturer while we tried to cover the flurry of return/repair requests coming in. Although our partner at that time would offer to accept repair requests, we didn't trust that they could deliver the quality we were advertising. So we just ate the cost of the returns.
Our search led us to a rep in NYC who specializes in sourcing fine materials and connecting brands with US-based manufacturers. She was a breath of fresh air. She introduced us to all the things we were missing: super high quality manufacturing, gorgeous materials and a real manufacturing “partner" for Leader Bag Co. She even would send us canvas, nylon and leather swatches, as well as samples of the hardware and finishes. Shocker! We didn't even know we should have gotten this from the first manufacturer. We were essentially designing blind the first time around. Hindsight, right?
The difference with this rep was that she required a retainer, and it was expensive. And honestly, we couldn't afford it, but we were panicking about losing the business. So we signed on with her and started paying. First red flag.
Second red flag: our new rep partnered us up with a manufacturer in NYC. And, surprise: she was the owner of that manufacturer. Maybe hers is the absolute BEST bag manufacturer in the US and was the perfect partner for us. Maybe.
The samples she created for us were exceptional (and again, pricey). We started to breathe a sigh of relief a little bit and felt like we could actually win back some of our customers… and confidently start to try and attract new ones.
Our first order with her went really well. We got beautiful, “made in the USA" bags that we still personally use and are so proud of. We really wanted to make it work.
But our margins were RAZOR thin. Between her retainer, the cost of the manufacturing, the “storage fee" we were charged monthly (red flag #3), etc, we just could not make it work. We didn't want to keep raising the price of the Julien Set - it was already super high at $625 - but we also weren't making any money to grow the business. We couldn't explore new colorways, hire a photographer to help keep our brand and website fresh, or sample new product concepts we had.
We felt stuck… and to make matters worse, when we were ready to place another manufacturing order (super lucky to have the customer demand for it), the unit prices were raised again. We could barely afford to place the order. Honestly, as a family and a self-funded company, we were deflated and financially tapped. We felt taken advantage of.
The Leader Bag Co team got together to discuss it for countless hours. We spoke to other business owners and did research online. We talked to our customers about “made in the USA" and how much of a driving force that was for their purchase.
Ultimately, as a group, we decided to look overseas. We were exhausted trying to make it work in America. We were sickened by the boxes of unusable inventory in our parents' basement (still there, by the way). We were ready to move on.
I'll stop now to emphasize that our SAVING GRACE through all of this has been our customers. Honestly, if it hadn't been for you gorgeous people buying the bags and shouting from the rooftop about the brand, we might have hung it up at this point. Between the positive feedback we were getting from our LBC bag owners and the media, plus our own deep-down belief that this product was REALLY GOING TO WORK, we decided to push on.
And this is where our story changes. Serendipity. We asked the universe for an answer and it fell in our laps. Meghan's friend/neighbor's brother-in-law is the cofounder of Hatley, a children's company that manufactures overseas. Megs was explaining our plight to him and he basically said “I know of a factory in China that would be perfect for this". He very generously shared the contact information and reassured her that this was a reputable company with fair business practices that produced great quality products at good prices. It sounded to good to be true.
We reached out to our new China rep shortly after and sent him a sample to recreate… and when we got it back, we were shocked at the quality. It was SO GOOD. It was *almost* indistinguishable from the most recent USA-made version. He didn't charge us for the sample. The partnership was simple and straightforward - he gave us prices and dates, and he stuck to them. He gave us a quality sample and it carried over completely to the full manufacturing order.
His is the company we use today and we love it. We're able to communicate easily and make requests, and he quickly, professionally and efficiently delivers suggestions, samples and swatches to us. His product is affordable and allows us to be priced competitively so that we can position ourselves for growth. We have had zero red flags. Zero. It's a complete 180 and we couldn't be happier.
There's a little pang of sadness that we couldn't stay true to the original idea to be made in America. But as we've grown the business over the years, we meet more and more companies who went through the same pains. We are happy that we tried - and, as I mentioned in the beginning of this article, the lessons we learned along the way are invaluable.
On our Leader Bag Co team, we try to remind each other that we've grown slowly for a purpose. If we had been faced with handling, for example, a celebrity endorsement during that first round of manufacturing, we wouldn't have been able to handle it. We might have even lost the business.
The company has always been manageable, and we've grown over time and organically. Although it feels too slow sometimes, we are ultimately confident that it's the right pace for us. We need to experience the things we've experienced in order to appreciate what comes next.
For now though, what comes next is a trip to China to meet our favorite manufacturers and their families. 2018 goals.