The Hoverboard rush of interest was profound enough that factories were appearing in China, as if out of nowhere, and seemingly on a daily basis, offering manufacturing rates that were not, strictly speaking, competitive. Factories were working 24/7 and STILL struggling to meet demand.

The demand rush created significant risks. Typically, small to medium factories are better described as assembly plants, meaning that they are able to transition very easily from producing different types of products. While this keeps costs low by creating a larger supply of producers, it also creates risks – products may not be produced competently or strictly adhering to standards, while a specialized and dedicated larger factory might be safer.

IMEX Advantage:

• Being on the ground in China with a team of skilled bilingual negotiators, we were able to ensure that we were working with the best possible factory out of the available options in China.

At first, Hoverboards were selling just as well as we had expected – which was, to say, they were selling quickly, and left us in a consistent rush to fulfill more orders – and collect more and more money.

As time wore on, however, major issues began to crop up within the distribution stage.

The first big problem came when The United Kingdom completely banned the use of Hoverboards in public spaces –legislating that they could only be used on private property.

With the Hoverboard effectively being a “transportation” device, things looked grim… until sales paradoxically increased! Probably because of teenagers, who likely saw the product as edgier and cooler than before.

However, that was before reports of Hoverboards started exploding. And then exploding Hoverboards became a trending media phenomenon. Injuries were reported, kitchens were destroyed from the resulting fires, and soon enough, Hoverboards became synonymous with “fire” and “explosion.”

NONE of our products had exploded, as we had sourced the highest quality parts from known and vetted factories. But we would nonetheless soon be affected by the Hoverboard chaos.

The United Kingdom instituted strict compliance measures by placing Hoverboards under “Trading Standards” scanners, and random inspections were increased on all Hoverboard shipments. Soon after, we learned that one of IMEX’s shipments was among those being inspected.

We were confident in our product, but, nonetheless, a single issue was detected: the UK standard plugs were non-compliant with UK requirements. The manufacturer was not aware that these cheap, five cent components were not compliant.

The takeaway is NOT that we had a poor product, as we had placed QC as our biggest priority. Ordinarily, this and other defects – such as fake batteries, non-compliant adapters, non-compliant plugs, irregular labeling, etc. would be ignored while bad products would leave the market owing to market economics.  The takeaway is that this could have happened to anyone! And, it turns out, was happening to not just anyone, but everyone. But for us, it was a problem.

Sadly, trading authorities decided to send a strong message – we were not allowed to replace the plug/fuse, or given the option to send the Hoverboards back to China. Instead, the whole shipment was to be made an example, and was destroyed.

We mention this to encourage you to think of what was happening to other manufacturers – especially those without quality control obsessed teams on the ground in China.

We went back to our factories in China and had the issue immediately addressed, and no further problems happened.

For us, the sales game was finally on.

IMEX Advantage:

• Absolutely none of our products had exploded, as we had sourced the highest quality parts from known and vetted factories.
• IMEX was able to immediately respond to portside demands for documentation.

While these compliance issues created a giant nightmare for Hoverboard vendors, it also had the effect of significantly narrowing the market, pushing out all the factories vendors in the market who hadn’t paid enough attention to compliance to survive the stringent measures in place at different markets. Our factory, being one of the bigger ones and properly vetted, had survived.

It was now prospering, too.

With the market completely clear of competition, our client decided to put resources into building their brand. By April this year, our client was selling one 40ft container per month, and now it has gone up to 3x40HC containers per month – or about $400,000 worth of purchases every month and about $1.6 million in sales. The product continued to evolve to where we now have a 1.5% return rate – quite impressive for a product that had a reputation for exploding.

IMEX Advantage:

• Our client is now the biggest seller of Hoverboards in the UK, and is in talks with Amazon to supply their Hoverboards as a Vendor under their Vendor Central programme.