Sourcing products can be a huge pain for entrepreneurs.
The Basics: What Do You Want?
In this post, a supplier is anyone who can provide inventory and products. It may be a distributor, wholesaler or manufacturer.
First, understand what kind of supplier you want. When you figure this out, you will know what to type in when searching. These are the most common options:
Overseas Vs Domestic Suppliers
If you want to wholesale or manufacture, you have to decide whether you will source from abroad or domestically.
Typically, overseas suppliers are in Taiwan, India, China and other Asian countries. They are popular because they offer cheap options. However, cost is not the only factor worth considering when making this decision. There are advantages and disadvantages of sourcing both domestically and from abroad.
Where to Begin Searching
The internet is a great place to begin your search. However, if you are looking for specific places, try the following.
Directories: free supplier directories can be found online and they tend to be very helpful. You will find thousands of profiles for suppliers, wholesalers and manufacturers. The best domestic directories include Kompass, MFG, Maker’s Row and ThomasNet. The best overseas directories include Sourcify, IndiaMart, AliExpress, Alibaba and Oberlo.
Google: supplier websites are not the most attractive. You may have to go to the second page of the Google search results to find them.
Local library: you would be surprised how useful local libraries can be.
Referrals: feel free to ask your professional networks for recommendations. If you can find successful people in your niche, the better.
Other Research Tips
Another useful way is searching for the NAICS (North American Industry Classification System) code of your products.
Suppliers and manufacturers sometimes list their products using the NAICS code. This makes it easier to find the supplier for your specific products.
The NAICS directory is easily accessible online or at your local library.
Once you have a list of several possibilities, research further to check their credibility.
The Better Business Bureau (BBB) will show you if any complaints have been filed against them. Facebook and Google reviews will also tell you a lot.
Requesting a Quote
Approaching your supplier is the next step. The price they will charge is probably the biggest issue in your mind. However, make sure you plan your questions and words beforehand.
In your email, consider these important factors:
- Your MOQ (minimum order quantity)
- Your sample pricing
- Your production pricing
- Your turnaround time
- Your payment terms
If you are doing this for the first time, you will soon hear about MOQs. Manufacturers may require you to buy thousands or, at least, hundreds of units as your first order. This depends on the manufacturer and the product.
When you do not have much money, MOQs can be difficult. Fortunately, they are negotiable in most cases.
Before you get into negotiations, understand the position of the supplier first then offer a lower MOQ.