Sourcing Agent Vs Distributor - AsianProSource.com

www.asianprosou... - If you're wondering what the difference is between these two common terms in the outsourcing industry, you should be clicking this video now.
Buying products through a distributor and getting them sourced via a sourcing agent are two of the most popular solutions for stocking inventory but not all sourcing solutions are created equal. Since your product source has a significant impact on your margin and overall business, it's important to determine what method is best for your needs.
The following factors should be carefully considered when choosing between a sourcing agent and a distributor.
Variety and Selection
When you buy a product thru a distributor, you are limited to the inventory selection that they have on hand. For example, if you want to sell a coffee maker, a distributor will offer you a few varieties of finish coffee makers to choose from. Alternatively, if you were to approach a sourcing agent with the same needs, the sourcing agent would have to find the best way to source a coffee maker with your specifications. This may include individual parts or components from multiple factories.
Customization
One of the biggest drawbacks to use a distributor is the lack of customization. While some distributors may carry custom-finish products produced by other companies, they cannot make any changes to these products. A distributor may be licensed to sell a custom brand coffee make on behalf of another company, but cannot change it in any way.
When you work with a sourcing agent, you can change any aspect of your product to suit your needs. In addition, you have the final approval on quality, adjustments and other specifications.
Prototyping
If you need help developing a prototype, a sourcing agent is the best choice. Since distributors can only carry finish products, they cannot assist with the prototyping process. On the other hand, a sourcing agent can assist you with prototyping, quality control and price negotiations with the factories.
Cost
When you work with a sourcing agent, they will help you develop a contract manufacturing agreement between you and the factory. Since there is no intermediary step through a distributor, you are essentially getting your product at factory direct pricing. Although there is a markup for both distributor and sourcing agent, markup prices are typically lower through sourcing agents. This is because a sourcing agent will negotiate an exact markup percentage in your contract. In contrast, distributors often add a fixed price markup and the original factory prices may or may not disclose to you.
Time
Since distributors carry items ready to be sold, they can often be shipped quickly. In addition, distributors do not invest in molds or production so smaller quantities are often feasible. If you need your items quickly or you want to order a small quantity, this might be a good option for you. However, keep in mind that your margins may be reduced due to additional markup.
Quality Control
A sourcing agent will provide you with the complete control of your inventory. Therefore, the quality control for your products are built around your specifications. When you buy through a distributor, you're getting the finished product sold as is.
So Which is The Best Option?
There is no one size fits all approach for every business. The best choice depends on which of the above elements are most important for your particular project. If you need your items quickly, do not require any customization or if you want to order a small quality, a distributor may be the right option for you.
If you need more control over you product, need help with a prototype or if you want to increase your margins, a sourcing agent is the best for you.
We made this video to specifically provide value for business out there who are planning to get help with the manufacturing side of their business. We sure hope this has helped you. If you want to learn more, give us a call to share your thoughts and we'll share our experience back to you. For more information, product quotations and other information about sourcing products in China, please feel free to visit our website at www.asianprosou... OR call us at 702.616.2298
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[@SD-rg5mj]

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[@Classic_literature]

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[@SD-rg5mj]

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