24/03/2021
SOURCING FOR THE BEST PRODUCTS WITH THE BEST DEALS.
What is product sourcing?
Product sourcing is the process of finding good quality products to sell from reputable suppliers at good prices. Within that process, there are a number of different stages, such as researching the chosen product, calculating the price and cost of the product, and then negotiating with suppliers in order to achieve the best deal. Ultimately, the goal of product sourcing is to locate the best products, from good suppliers, at prices reasonable enough that they allow for a distinct profit margin.
There’s never been a better time to be an online seller. Global e-commerce sales are projected to top $6.54 trillion by 2023, according to Statistica. No matter what channel your business started out selling on, a multi-channel strategy is key to capitalize on today’s global e-commerce growth.
After all, the more places you sell, the more buyers you reach. But it’s not enough to simply be present on multiple platforms—your products need to resonate with consumers, too. That’s why smart research and product sourcing will be critical to your future success.4 product sourcing strategies to take note of
If a product sourcing agent isn’t available to you, or unnecessary for your e-commerce journey, then there are ways to learn and undertake product sourcing strategies yourself.
1. Work with a wholesaler
If a good relationship can be developed with a reputable wholesaler, there is a world of opportunity waiting in the form of being able to sell unlimited, unique products without the cost of needing to manufacture them yourself.
Additionally, many wholesalers will only produce products they know are guaranteed to sell well because of the huge quantities they make at any one time - so you already know there is an established need or market for your product. However, due to the nature of wholesalers, products will need to be bought in bulk which means bigger initial costs upfront, as well as inviting potential undercutting competition from other sellers procuring products from the same wholesaler.
2. Work with a manufacturer
Establishing direct working relationships with manufacturer’s cuts out any potential middlemen as you are shipping the product to yourself with no additional incurring fees. Whilst you will be able to attain products at lower prices than working with wholesalers, you will still need to buy in bulk because of the minimum order quantities manufacturers work to which could prove too expensive for a starter business with a smaller budget.
3. Try handmade products
A recurring trend, the appetite for artisan, handmade products is growing year on year as buyers aim for originality and uniqueness in their products or furnishings. A majority of the time, most sellers will be small independent businesses, so there is no need to pay bulk fees and the margin for competition is lower as the products sourced are likely to be completely unique. However, inventory could become a problem if the demand out surges the rate the seller can produce, or if the seller is unable to continue manufacturing the products.
4. Visit a trade show
Trade shows, exhibitions, and conferences can not only be great places to conduct market research, but also identify and establish relationships with manufacturers, wholesalers and other independent retailers often selling unique products that are not yet common market knowledge.
