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Purchasing goods from suppliers is not as simple as adding them to the shopping cart and then paying. Generally, suppliers set MOQ (minimum order quantity) , especially suppliers on Alibaba. Their MOQ is usually very high, which is completely unaffordable for novice sellers. However, it is not difficult to solve the minimum order quantity problem. Sellers should understand the supplier's concerns and then adopt corresponding negotiation strategies. In today's article, we will look at how to negotiate with suppliers and get them to accept your proposed MOQ. If you really can't reach an agreement, you will also know when to let go. MOQ (minimum order quantity) is the minimum order quantity, which is commonly encountered by sellers when they are looking for suppliers to purchase products. For an order, the supplier is willing to start production only if the order quantity exceeds the MOQ. The minimum order quantity generally depends on the cost required for the supplier's production, which includes not only labor and material costs, but also machine operating costs, and even other special costs. It is not only complicated and time-consuming, but also has a higher overall cost. Because the production volume is large, the cost of each product will be lower, so the unit price provided by the supplier is usually the most favorable. The minimum order quantity for each order is usually at least thousands, or even up to 10,000. But there may be some suppliers who would be willing to provide a test order, usually in quantities of 50-200 pieces. B2B suppliers have higher minimum order quantities because their customers are not ordinary small sellers, but large enterprises with stronger purchasing power. This type of supplier is not very suitable for small sellers. How Amazon Sellers Determine Minimum Order QuantitySmall sellers need to calculate based on the quantity and price that the supplier is willing to produce . If you purchase too much at once, you will incur a lot of storage fees, whether it is FBA or FBM sellers. You also need to determine whether the supplier is reliable, test the products, and ensure that you do not receive defective products. A low minimum order quantity is better for small sellers, and large orders are accompanied by high risks and high losses. What determines MOQ is the seller's purchasing cost. If the MOQ is small, the supplier will increase the unit price of the product to avoid losing their own interests. You can place an order with a small supplier, but you cannot get the goods at the most favorable ex-factory price. So, is there nothing that small sellers can do? Actually, many sellers have negotiated with suppliers to resolve the MOQ issue. The following five strategies will help you succeed in the negotiation process with suppliers: Some suppliers set their MOQ higher than the actual MOQ because they want to discourage small orders to keep their profit margins high. As a seller, you will definitely understand this, which will help you get the right mindset to start the negotiation. Before placing an order , be sure to ask for samples from suppliers. After confirming the quality of the products produced by each supplier , calculate the minimum order quantity. Note that the quotation and minimum order quantity of each supplier's products may be different.
Note that when you place a sample order with a supplier, you should tell the supplier that you intend to continue the cooperation. Tell him that you are asking for samples to inspect the goods first, and the size of the final order will depend on the quality of the samples. 2. Say you are a first-time buyer As a seller, I believe you can consider the supplier's business perspective. Therefore, don't tell the supplier that you are not sure whether the product can be sold or that you don't have enough funds to purchase more. The supplier will ignore you and will be unwilling to cooperate with you. You should say that this is your first time to purchase products from him, and you want to buy a small order for testing, the quantity is about 20-25% MOQ. Generally speaking, suppliers will accept this request immediately, and they will think that you really want to buy and not just ask for the price. But be prepared that the final price of a single product may be higher than the MOQ price. If you think it is okay, you can place an order. If your product needs to be customized, suppliers generally will not accept small orders because they may have to purchase special parts to produce customized products. But you can still try to negotiate with the supplier to reduce the minimum order quantity by 30% or even more. Let the supplier know that you attach great importance to the successful completion of the first order. First put forward your requirements for product production, and then negotiate with the other party to reduce the minimum order quantity. Tell him that you want to collect market feedback first to improve the product before preparing to place a large order. Note that when negotiating, the reduction range should be controlled within 30%. If the minimum order quantity you quote is too low, the supplier will not be able to recover the cost, and it is unlikely that the negotiation will be successful. If the supplier is unwilling to compromise, then try the next strategy. 3. Worry about others' worries, and others will also worry about their worries If the previous negotiation fails, then show that you understand his position. Tell the supplier that you will never let him lose money and that you want long-term cooperation. Negotiate from the supplier's perspective; if they understand, they may accept your proposed MOQ. 4. Appeal to the feelings and enlighten the mind Continue to communicate with suppliers in an emotional and rational way to establish harmonious relationships. You don't have to be very professional, as long as your overall tone is sincere. When talking, you can proactively explain your ability to sell the product and assure them that you are a buyer with real purchasing intentions. If their minimum order quantity seems to be more difficult than other companies. Reiterate what you will spend to promote this new product. Provide details, such as the percentage of the free gift and how much you will spend on advertising. Be direct. During the negotiation, you need to let them know clearly that although you think this supplier is the most suitable, you currently have other suppliers to consider. If they cannot meet the MOQ value you proposed, you will have to look for other suppliers. The best time to respond is 48 hours. If the other party is just an employee, you will have time to ask your boss before giving you a specific answer. You can also buy the spot goods they have already produced. Generally, factories only produce when there is an order demand, but occasionally orders are temporarily cancelled or there is excess production. In this case, you can usually purchase the products at the MOQ you proposed because the manufacturer wants to sell this batch of goods as soon as possible. 5. Modify other conditions Some manufacturers may still be unwilling to provide you with products according to your MOQ. However, they may not necessarily be unwilling to cooperate with you, but just cannot accept this MOQ. At this time, you can still make slight changes to other conditions and continue to negotiate. Specifically, it depends on which of the following aspects the manufacturer has difficulties: If the supplier says the problem is the cost of starting up the machine, you can tell them you are willing to share some of the costs. This shows that you are flexible and that you are serious about working with them. Maybe the supplier can't accept your MOQ because they have to buy the special part to customize it. In this case, you can ask them if they can accept your MOQ if you are willing to pay for the part for this order. After all, your first order must ensure that the part is suitable. If the supplier cannot accept your MOQ because they cannot recover the cost, then you can increase the product quotation or increase the MOQ value, such as from 30% MOQ to 50% MOQ. Attach a purchase order to send it to the other party to let them know that everything is negotiable. If they still refuse and don't offer any other terms, then you can be sure that they really can't lower the MOQ. What to do if negotiation fails If you cannot reach an agreement with this supplier, you should look for other suppliers to negotiate with. The key to negotiation is the price point you can accept. If you want to conduct market research on your product first, you can start by cooperating with a small supplier. Once your business develops slowly, you can then look for a large supplier with a higher minimum order quantity. Remember to leave things open when negotiating with suppliers, and don’t end the negotiation on bad terms, as you may have to come back to them. Don’t feel pressured by a high minimum order quantity, and politely tell the supplier that you need to release the product for testing before placing a formal large order. Three major platforms for finding suppliers Alibaba is the best platform for finding suppliers, because these suppliers are generally manufacturers and usually sell at the most favorable prices. In addition, Alibaba has strict supplier verification measures, so sellers are less likely to encounter fraud when purchasing. However, if you still cannot reach an agreement with the supplier on the minimum order quantity, you can also look for suppliers on other platforms. The main websites are: 1. Dunhuang.com (https://www.dhgate.com/) DHgate is a product wholesale website that mainly cooperates with small sellers, so the minimum order quantity is generally small. You can pay the supplier after confirming receipt of the goods. Although the unit price of the product may be higher, it can reduce the risk.
2. AliExpress (https://www.aliexpress.com/)AliExpress is a well-known B2C website where you can find small suppliers and the minimum order quantity is not high. However, it is difficult to verify the suppliers here, and it is difficult to tell whether the other party is a supplier or a small seller, so be careful of fraud.
3. Global Sources (https://www.globalsources.com/)Global Sources is a third-party platform for sellers and suppliers to trade. If you can't find a supplier yourself, or can't find a supplier yourself, you can check this website.
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