Do You Need an Importer or Manufacturer?

Do You Need an Importer or Manufacturer?

Several factors contribute to the success of online business. Of these, product sourcing is arguably the most critical. After all, you cannot sell products if there are no products to sell. I know, really groundbreaking idea. But, the method in which one goes about getting the aforementioned product is critical. Online retailers can find goods either by working with a manufacturer, or through collaboration with an importer.

Manufacturer vs. Importer

As with anything, both options have their advantages as well as their disadvantages. If you prefer to find products to resell online through your business by working with a manufacturer directly, then you can buy the goods from manufacturers in countries where production is cheaper. In this case, you will be liable for the payment of duties on the merchandise being shipped.

The rules and regulations of importing goods not your thing? Then, your best bet will be buying from an importer in large quantities. If money is a problem, you can buy in small, affordable quantities. Importers complete all necessary legal import customs clearance procedures and formalities on commodities, saving you time and helping you to avoid stress. However, the support that they provide in the area of customs will cost you, reducing your profit margin.

Method over Madness

The quantity of merchandise that you plan to buy also determines what method you should adopt. For instance, it if you are working with a manufacturer, then it won’t make financial sense to import small quantities of goods. Jingsourcing.comstates that retailers who import a small quantity of merchandise directly from China encounter problems such as higher shipping fees.

In some cases, these fees end up being even higher than the value of the products being imported. There’s also the issue about your order falling short of the supplier’s minimum order quantity. Hence, unless you are willing to match a supplier’s minimum quantity order, it makes no financial sense for you to try at all. Wholesale suppliers rely on bulk-purchases to make a profit since they operate on low profit margins.

So, in cases where you prefer to deal with a manufacturer but are unable to meet the MOQ set by a particular producer, you may resort to smaller suppliers who do not have minimum order requirements. This option isn’t economically efficient either, as more modest manufacturers charge a higher price per unit to make a profit. Add shipping fees and customs duties, among others, and you’ll end up paying more than you would have if you bought the items from an importer.

Therefore, online retailers who wish to enjoy success should try not to limit themselves to using only one sourcing technique. Instead, try to be open to any approach that lets you maximize profit and find the best deals for your online business at any time.

Author:  Christine Duff

Christine wants to live in a world filled with cutting edge fashion, beautiful words and and an endless supply of leather jackets and boots. A product development grad of FIDM, she was the Editor-in-Chief of MODE Magazine where she reignited her love of storytelling. She has diverse experience within the industry with trend research, art direction and styling editorial spreads. She gained her most notable experience working in Los Angeles at the satellite operation for GQ and Vogue Thailand. Christine is passionate about social science and the role it plays in the consumer goods industry and apparel in particular.

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