meet Isaac commonly known as the sourcing guy on social media where his videos have racked up millions of views Isaac has become the go-to expert for e-commerce entrepreneurs looking to Source Products and he manages his entire operation from barley his journey started with selling portable fans to sority girls at parties now he's sourcing products for some of the world's largest e-commerce Brands by senior year we were already doing a few million dollars in Wells in this video Isaac shares how much he earns from his business how beginners can start a sourcing Venture and offers valuable tips on finding the best products for your e-commerce store when did you move to Bali uh it's been 2 and a half years now yeah and where did you move from from Miami that is a big change right it's a big change and a lot of people ask me they're like what you're from Miami like why would you ever leave Miami and I do love Miami and like I'm back like 3 four months out of the year but you don't get this in Miami did you just visit Bali for a holiday and she's like this is it pretty much I mean I kind of knew I wanted to go and live in Asia and I was I was on a big sourcing trip so I was visiting factories in Cambodia Sri Lanka and Thailand yeah and I was kind of burnt out after that and I went heard B was this you know amazing place to go and work from so I came out here to come try it out and immediately after like 3 days was like okay I can actually see myself living here so what were you doing before sourcing I've always been sourcing so my dad when he was my age moved to China and opened up an Electronics Factory and then before that my grandpa and my mom side we had a small apparel Factory in Canada where I was originally like born and grew up and then would always go and work for the factor from like being like a toddler helping out with the Fabrics doing Swatch cards and then when I was older going to China with my dad helping manage the factory there and then decided rather start an agency to help other people Source Products and become like a sourcing agent and so I started my agency eight years ago now I started the business freshman year of college by accident I brought these little cell phone I would always like order gadgets on AliExpress I thought they were fun I brought this little cell phone fan that plugs into your phone to a party just cuz it was genuinely hot in Gainesville Florida University of Florida and um I go and I you know start using it at the party and all these girls start coming up to me like oh my God where do you get that that's so cool I need that for sority Rush and I kept on giving them some of them like ala link or that Ali Express link and then like the fifth person they were like where do you get that and I was like I'm I was kind of drunk I was like I'm Isaac the fan guy I sell fans they're $5 would you like one and they're like yeah I'm like well I'm sold out right now just completely like off rip then I ordered the 100 sold down a week and it wasn't the was it the you were just slinging fans this is just me this is like freshman year at College me just slinging fans but then very quickly bought 100 bought a thousand had people sign them all around campuses had some news articles about us then my hometown reached out and they're like hey can we buy 2,000 fans with our logo on them I'm like yeah sure you know they'll be 20% off but we made like $6,000 just off that little bulk order and I was like wait this is a way better business than selling to drunk stor girls like I should be selling these to businesses this is a fun part about Bal you can come in G makes my clothes oh really yeah okay so one of the benefits about Bali is that we have lots of access to you know fabric markets and we have like awesome tailor this is the issue with like manufacturing and Bali it's an island so you're not going to have all these big fabric mills to be able to go and get your the Fabrics a lot of them are going to come from China either way you're going to have uh from like a labor cost perspective it's going to be naturally higher than almost anywhere else in Indonesia because it is like a touristy kind of Zone and you have lots of holidays and so like all these different elements make it a very slow expensive place that makes it hard to scale but the thing is great brands have started here yeah of course because they have people like GE to be able to go and they test out fabrics and they're able to do small runs and get going um but I'm helping like eight of my friends right now with brand and Bali move their manufacturing outside move mostly to China because it's just it's too hard to scale this is David he uh does all my video work yeah so you has been growing hates fast is H hey is that how you get all your clients yeah exactly for the most part we have some other like we have sales reps and stuff like that yeah but you know obviously you know the best is inbound so we're making a series about popular products and then how much they actually cost we were having a hard time in the beginning going to socials because it was very education focused if I don't make the videos that are interesting to everyone I'm never going to get the eyeballs and never be able to actually grow my personal brand so it took us a while of trial and error to find the types of content that was going to work yeah uh and then once we found the series that worked we just kept on repeating and now we're doing a lot more travel stuff going over to Vietnam going over to China doing more YouTube long form last month we grew like 120,000 followers uh fully organic that's crazy yeah and how many clients would you get from that 300 inquiries a month probably for sourcing and we'll take on like one to two and what's that life the lifetime value of the clients oh I mean a lot of them are going to be six figures yeah so it's crazy assing hundreds of thousands just a off social media yeah it's it's great awesome these are our sugar gliders no way they don't look real they're so cute they're super cute so if you were starting out how would you get your first s and classs so I found like we started out uh doing corporate sourcing so we were doing like custom t-shirts custom water Bots hats cuz you know most businesses are going to need some level of like swag and giveaways and that's a pretty low you know low hanging fruit it's lower volume it's going to get you kind of comfortable going and sourcing products and delivering the customers uh and you kind of just grow from there you start working with bigger and bigger businesses you work on uh like getting all those deliverables in place and then the bigger jump is then working with actual e-commerce Brands yeah uh and I took it took us a few years of like getting really comfortable with working with factors overseas with overall production process making sure everything was perfect and then we can start taking on you know seven plus figure Ecom so you basically have to find factories vet them make sure that good and then put the clients in look is that basically what you do that's what we like to do so our whole thing is that we've been curating the best factors around the world because it's it's pretty easy for Brands to go and find like mediocre products you can go on Alibaba you can filter you can find like a decent product but if you want to find like the best t-shirts in the world the best hats the best of whatever the product is that's the hard part but then once you go and do all that work to find the best of the best then you can bring on a client and then easily go and plug and play how do you charge that to a customer because obviously they can eventually find those factories it just takes trial and error you're just saving them time right and helping them manage that relationship exactly we're saving them time and reducing their risk because a big obviously it's not just the cost of the product but it's also the risk that you might take by doing it wrong so if you do a production run for $100,000 and the production's wrong then you have to you know not only do you lose all the time yeah and the market opportunity of selling the product especially if your Brand's growing really quickly but now you're going to lose the actual product that's was supposed to be blue and came out green so could a beginner just G Alibaba find a couple of factories organize the samples and stuff like that or do you need to actually go to China you build the relationships again I think that a beginner can go and make mediocre products but if you want to make the best product in the world that's where the kind of experience and then the whole kind of blueprint that we built like that's where you have to go and follow to really execute it's funny like you and Daniel like you guys are exploding on social media it's almost like sourcing is becoming sexy like it's always like cool now like finally the most boring thing well it was my like least favorite part of like managing the Eon PR like why do you think it's getting so beig I think people are interested in like where products are coming from right they love behind the scenes especially with Tik Tok and social media people want to see like the get ready with me the behind the scenes of The Olympian you know at the Olympic Village eating their muffins and all that kind of stuff social media infection point I think so yeah and then it's kind of a perfect uh Cross Point because everyone wants to start a business everyone wants to have a brand right and they don't know how to do it and then you also have the behind the scenes of how these bigger brands are manufacturing and where they're getting their products from it makes it feel very tangible yeah you know I I can do this to relable relatable right it's just like they see us selling your product for $80 and they're like how they even making this possible seeing it be made for $10 and just like wow I'm actually going to be able to do this exactly what your main tips of dealing with like China and the supplies there you want to keep them on their toes as much as possible so a lot of people go and they think like oh I have my Factory in China I'm good with them I don't I don't really need a backup and I'm scared to let my factory or my agent know that I'm looking at other factories because it's going to hurt the relationship my opinion it's only going to strengthen the relationship because if they know that they can take advantage then they probably will so you H them knowing that you have contingencies you have other factors you're negotiating with you're showing them the pricing you're getting from other factories they know that if they don't you know act as an a level supplier someone else you know it's a very competitive game someone else is going to take the business so I would say always have that back up and then from a production standpoint you really really have to like that's why we built like like an 80 step process to go and Source Products and the team has to go through and check off like 80 boxes because there's so many little ways where you can mess up but if you follow the steps like you will not mess up one of the biggest things is is clear communication so can you build a specification sheet can you build a tech pack can you build exactly how the product is going to look exactly how you're going to imprint it something I like to talk about is centering just because you tell the factory this is centered doesn't mean they're going to center it properly they're not really going to is is it centered this way is it centered this way it's better to go I want 4 in here 4 Ines here 2 Ines here 2 Ines here then say centered so again as specific as you can go don't let them make any decisions for you try to make them all what techs are tell me about the progression of the agencies like first year what did you make second year what did you make what was like the major turning point yeah I mean so started off in college doing like you know few 100K just going and selling some merchandise by the time you know graduated in college but by senior year we were already you know doing a few million dollars in sales so it was a big growth a lot of that came from starting to work with more e-commerce clients yeah so what happened was we started in corporate and the corporate business was great it was really fun but we were doing everything direct to factory we had a different model of how we were sourcing the merchandise because all my friends kind of you get it like when you're a young entrepreneur and you you know have a cool business who are the other ones in their 20s it's normally the Ecom guys so a lot of my friends are these Ecom guys and then Co hits all their supply chains break right but their sales are growing because ads are performing so they're like they call me and they're like Isaac can you go in can you help me here so I'm like yeah sure and then we went and started taking on these like huge projects taking over company's entire Supply chains and it really was like a test because it was the hardest time to ever source and ship product but we were able to do it successfully So Co it also accelerated demand but of the complexity it got your hate to CL they realize how fragile their supply chain exactly and I think that it's still at this point where Brands now know that they need to have contingencies and we're coming in and we're building out those contingencies for them yeah so what year was that that yeah was your third year of the agency that was my yeah my third year of the agency third or fourth year I like my agency what we're trying to do is we're trying to again offer more solutions for smaller Brands because I mean you get it like the impact that we can make is going to be very much tied to like the overall scale yeah also a lot of what we do is move stuff out of China Cambodia Sri Lanka Vietnam Thailand we're going to um a little bit of Northern Africa so Egypt has been great uh we're doing some stuff in Pakistan it's really like an an observation of you have to look at where the raw material is coming from you have to look at the labor cost you have to look at overall taxes and you know where that kind of country is progressing so you can kind of run onun a little bit of analysis and look at the volumes and say okay like if you go and you move over to Egypt your lead time is going to you know increase by 30% but your cost basis is going to decrease by 30 so what's worth it I think it's the cost basis what's the kind of good first year in terms of income creating like a sourcing agency I think you could off of first year you could make like probably 60 Grand pretty easily if you go to any like decent sized business they're probably going and they're spending $100 $200,000 on like t-shirts and mugs and those kinds of products if you're able to run a 50% margin all you really need to do is get $120,000 in sales get majority of one business's book of business and you can make like you know a decent salary how do you get that first client should like obviously it's corporate as you said do you just DM them or do you like Source their product cheaper like so well I think that sourcing going with price isn't how I love to sell but I think when you're getting started it's the best way the whole thing with the corporate merchandise is that majority of people don't Factory Direct they're going through these this domestic supplier networks so these big suppliers in the industry that go and they're going to stock you know millions of t-shirts millions of water Bots millions of hats and then the domestic industry you just go and you submit a purchase order to a warehouse in the US they decorate the product and they deliver it to your client for you but if you're if you go direct to factory you can easily get like 30% less yeah so all you need to do is go to any business i' recommend going in your local area so you can go door knocking you can go up to them and say like hey you know we're different we Source merchandise for brand but we're different because we're going Factory Direct so we typically can get pricing for way cheaper can you just go and tell me the products that you're going and and making right now and let me price it out for you right and then they're going to go and they're going to say yeah for the hats you're paying $12 and then you're going to go on alib Baba and you're going to go and you're going to find a hat for $3 and then you can go and sell to them for seven would you go get a sample from that factory like let's say we've got the udy on a hat yeah do you need the actual sample from the company first to then send to the supplier to get the actual final sample or you just like these are my actual prices and you can just do it without touching into so I always recommend trying to get samples from factories if you never worked with them before because you don't want to go and pitch a product that's going to be low quality um you want to send reference samples of if the clients very happy so if the client's like I love this hat it's perfect it's just too expensive great take that sample ship it over to China um and have the factory go and try to replicate it the best they can what's a really really good sourcing agency like make how much cash can they produce I mean I know sourcing agencies that do hundreds of millions of dollars in sales a year wow I mean like yeah I know people with sourcing agencies that have $80 million houses in Hong Kong you know incredible so you can make a ton of money I met a guy in Hong Kong recently and he started like at my age pretty much just going to China starting to sling products he was growing the sourcing agency eventually got to the point where you started buying minority Stakes into some like headwear factories and started really uh focusing on that category then close you know like people like New Era as clients so you start going after really really big business there's kind of two ways you can go with it you can either resell the product and have your margin baked into it or you can have a flat percentage basis and then make the money off of all the production that you're managing so he kept on growing growing getting bigger and bigger clients really understanding Niche having the best pricing out there at the point for this quality of hat and then built it built it built it into doing you know he does hundreds of hundreds of millions of dollars a year now that's crazy what's the main thing when you buy a factory that you need to know or buy interest in a factory it's a tricky thing it's it's something I don't recommend you just start out like okay this what I'm going to do I'm going start buying a factory because most people that I know that Bond factories have failed miserably and have burned themselves pretty significantly unless you're going to go and live there at the factory and I going to be able to do things that times samples getting created like was the main I would say pricing and also quality uh so like for example my dad the benefit of him having the factory in China was to be able to produce the highest quality power inverters in the world so that he could get the licenses for the big Brands and and really offer you know a product that wasn't available in the market so he really focused on engineering and R&D uh and that was his main stress was that he kept on going to China he had an e-commerce brand uh he was selling these inverters and he kept on going to China and was really stressed out because he could never get the quality that he wanted to in the market so we just said screw it I'm just going to make open up my own Factory and make sure the quality is perfect yeah that's incredible well man you know your very uh very happy to have you own daily menoy your guidance has been crazy for for all of these uh Brands as well so I appreciate yeah of course man it's been a pleasure ch