How to Find a Trustworthy Sourcing Agent
Working with a sourcing agent opens up a world of possibilities for your business.
In essence, a sourcing agent acts as your invaluable partner in locating and selecting the most suitable suppliers in a specific country. Think of them as your expert guide, well-versed in the intricacies of local business practices and customs, and often fluent in their native language.
Whether you're seeking manufacturers, wholesalers, or distributors, a sourcing agent can effectively navigate the local landscape to meet your specific sourcing needs.
However, work with the wrong sourcing company and your business will become vulnerable and exposed to risk. You’ll need to be careful when making your decision about which agent to engage.
Here is our five-step guide to finding the right sourcing agent.
Step 1: Do your research
There are plenty of sourcing companies out there, and so the first step is to do some research. You may have received recommendations from other business owners, but there are plenty of other ways to conduct your own research.
You could attend trade shows, conferences or seminars and workshops to expand your networks. You can also look around for companies with experience in your area or industry and who have a demonstrated experience in the markets you want to grow into
You could attend trade shows, conferences or seminars and workshops to expand your networks. You can also look around for companies with experience in your area or industry and who have a demonstrated experience in the markets you want to grow into
Step 2: Make a shortlist and get in touch
Once you have done the initial research, make a shortlist of candidates. It’s time to dig a bit deeper and learn more about the sourcing companies that are proving to be the best possibilities.
Many companies also offer free quotes or initial consultations, so you can get a better idea of what they can do for you before formally engaging them for their services. Have a chat with them, dig deep and make sure they are right for you.
Many companies also offer free quotes or initial consultations, so you can get a better idea of what they can do for you before formally engaging them for their services. Have a chat with them, dig deep and make sure they are right for you.
Step 3: Consider the costs and the risks
Your sourcing agent must be willing to give you clear and detailed information about costs, budget and risks. If you come across an agent and they don’t provide detail about commission or kickbacks they stand to receive, then that is a clear red flag to stay away from them.
Another common problem is where sourcing agents overstate their relationships with manufacturers and would have you believe that they own the factories that are being used. In most cases, sourcing agents won’t actually own factories – they will have relationships with third parties who do.
Another common problem is where sourcing agents overstate their relationships with manufacturers and would have you believe that they own the factories that are being used. In most cases, sourcing agents won’t actually own factories – they will have relationships with third parties who do.
Step 4: Negotiate a price
If you have found a sourcing agent you like, then see how you go negotiating a price with them for their services.
The negotiation and planning stage provides the perfect opportunity for you to see how trustworthy your potential agent is, and if they are acting with integrity and honesty.
You can also ask them if their price will be lowered if you make the same orders on an ongoing basis.
The negotiation and planning stage provides the perfect opportunity for you to see how trustworthy your potential agent is, and if they are acting with integrity and honesty.
You can also ask them if their price will be lowered if you make the same orders on an ongoing basis.
Step 5: Compare with others and ask questions
Once you’ve negotiated a price, you should compare that price to other sourcing agents you’ve been negotiating with.
However, price is not the most important thing. To make the right decision, and avoid a mediocre (or downright bad) experience, we also recommend you ask the following questions of any potential sourcing agents.
However, price is not the most important thing. To make the right decision, and avoid a mediocre (or downright bad) experience, we also recommend you ask the following questions of any potential sourcing agents.
Does the sourcing agent understand your business and vision?
Be prepared for the possibility that the goods you are after can’t be sourced. In some cases, despite everyone’s best efforts, there just isn’t a manufacturer that can produce what you are after.
If your supplier tells you that your requested requirements are not possible, that’s actually a good sign! It means they are being honest about the possibilities and what they have found through their research.
Your sourcing agent should also understand the level of quality you are after in your products, and let you know if there are any quality concerns from the proposed manufacturer.
Finally, they should also understand your pricing requirements and be truthful about what is possible with what you have to spend.
If your supplier tells you that your requested requirements are not possible, that’s actually a good sign! It means they are being honest about the possibilities and what they have found through their research.
Your sourcing agent should also understand the level of quality you are after in your products, and let you know if there are any quality concerns from the proposed manufacturer.
Finally, they should also understand your pricing requirements and be truthful about what is possible with what you have to spend.
Is the sourcing agent realistic?
Chances are you have invested a lot of money, time and hard work into your business. It is important to find a sourcing agent who “gets you” and understands the vision and goals you have for your business.
As you commence international sourcing, the quality of your relationship with your sourcing agent can make a big difference in the outcome. Find a sourcing agent who is willing to take the time to assess the opportunities and possibilities you see for your business.
As you commence international sourcing, the quality of your relationship with your sourcing agent can make a big difference in the outcome. Find a sourcing agent who is willing to take the time to assess the opportunities and possibilities you see for your business.
What commission will the sourcing agent take?
Some sourcing companies don’t like sharing the details about how they work with and interact with manufacturers. In many cases, however, sourcing agents may receive a commission when they provide work to a manufacturing company.
The kickback they receive can be quite significant, and your sourcing agent should be upfront about any commission they may receive.
When sourcing agents make decisions based on the commission they might receive, you may not be getting the best value or service that you deserve so you have a right to understand how much manufacturers are being paid.
The kickback they receive can be quite significant, and your sourcing agent should be upfront about any commission they may receive.
When sourcing agents make decisions based on the commission they might receive, you may not be getting the best value or service that you deserve so you have a right to understand how much manufacturers are being paid.
Is the sourcing agent with you for the long haul?
Using a sourcing agent to help you find your stock and products is certainly not something you can “set and forget”. You will want to find an agent who is willing to work with you on an ongoing basis, because even once manufacture begins, you will continue to need your sourcing agent.
Sourcing agents have a role to play in ensuring the ongoing quality of your products, and be your liaison if there is any drop or change in quality. Your agent can also keep you informed about changes at the factory, including new technology or product options.
Sourcing agents have a role to play in ensuring the ongoing quality of your products, and be your liaison if there is any drop or change in quality. Your agent can also keep you informed about changes at the factory, including new technology or product options.
Get to know The Sourcing Co
We understand how important it is to find a sourcing company that you can trust, and one that is well-connected.
At The Sourcing Co, we are committed to finding the best quality products at the price point you are after. When your business is ready to grow within global markets, we are here to help you through that exciting journey. We’re here to help ensure your vision comes to life and your product makes it to the market.
Get in touch with us today to discuss your next shipment, and your goals when it comes to finding the right overseas suppliers.
At The Sourcing Co, we are committed to finding the best quality products at the price point you are after. When your business is ready to grow within global markets, we are here to help you through that exciting journey. We’re here to help ensure your vision comes to life and your product makes it to the market.
Get in touch with us today to discuss your next shipment, and your goals when it comes to finding the right overseas suppliers.
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