To help you find the ideal sourcing agent for your business, we compiled this helpful checklist:
Step 1: Define what you need
The first step is to become aware of what you need and what requirements you have for your sourcing agent and supplier. It’s helpful to write a document describing what is important to you.
With your sourcing agent, this includes the scope of services, language skills, location, level of experience, payment model, etc. Your requirements to the manufacturer should also be clearly defined: Which working conditions should prevail, which material type and quality should be used, how long should the delivery times be etc.
Once you know all this, you can continue with step 2.
Step 2: Set your budget
In the second step, you should think about your budget.
How many units do you want to produce, how much can you spend on your products and how much can you pay your sourcing agent? It is best not to set a 100% fixed budget, but a range, as unexpected costs can always occur.
Step 3: Choose a type of sourcing company
As we have seen before, there are different types of sourcing companies.
Each type has its own advantages and disadvantages. Decide for yourself whether you prefer to work with a single agent, a larger sourcing company or a full service sourcing & logistics company.
Step 4: Research & Compare
Now that you know what you need and what kind of sourcing agent you want to work with, you can start your research.
But don’t just google and use the first result that pops up. Rather use platforms where you can read different independent reviews from other sellers,
Then pre-select 3-4 sourcing agents that meet the criteria you defined in step 1.
Step 5: Get different offers & ask for business licenses
Now get offers from the sourcing agents you already included in your pre-selection.
The offer should include the price for each service you want to use, the pricing structure and how the price is calculated.
Important: Get a copy of the business license together with the offers! Then choose the one that fits your requirements and budget best.
Step 6: Negotiate payments
Now that you have chosen a sourcing agent, you still have to negotiate payment with him. While larger companies usually have a fixed price structure, you can often negotiate a better price with agents who work independently.
Also, clarify whether the price for sourcing services will decrease over time when you re-order.
Step 7: Write down everything that was agreed on
In the last step, you should write down everything that was agreed upon.
Then both parties, i.e. you and the sourcing company, should agree (e.g. via mail or weChat). For example, it must be clear who is responsible in the event of poor production quality or if the delivery is delayed.
The type of payment and the amount should also be written down and confirmed by both parties. This way, you will have a document on which you can rely in case anything goes wrong.