How do sourcing agents get paid

Top 9 Sourcing Agents. These are: Single sourcing agents who work independently Especially in China there are many sourcing agents who work on their own. However, there are also disadvantages to working with only one person. The risk of getting scammed is therefore a bit higher. Sourcing agencies Sourcing agencies are sourcing companies that employ several sourcing agents who have different product focal points. Why should you use a Sourcing Agent? Many Amazon sellers are often deterred from sourcing goods from other countries.

All this is done by your sourcing agent for you. Briefings A sourcing agent will also help you to set up a perfect briefing, which you can then provide to the supplier of your choice. Negotiations Some sourcing companies also offer negotiation services. Thus, negotiations are more efficient and faster. Verifying Certificates It is always advisable to see official certificates and licenses from your manufacturer.

And we fully agree. There is none. The risk of being deceived by the manufacturer is thus dramatically reduced. Find my Sourcing agent. What makes a good Sourcing Agent? Testimonials The more experience a sourcing specialist has, the more companies they will have served. Language One of the most important tasks of any sourcing company is to mediate between you and the supplier.

Supplier Network This point is usually closely interwoven with the experience factor. Transparency As with any other service provider, transparency is an absolute must.

Then there is factory B. Their language skills are poor Many sourcing agents claim that they speak fluent English or your mother tongue and the language of the supplier country, such as Chinese. Great question. Simply put: the more you pay, the more they make.

Hourly rate In this model, the sourcing agent is paid according to his working hours. Flat fee With this model, you pay a fixed amount that is agreed at the beginning of the project. There will be no further costs. Mixed payment structure Another common payment model is the mixed one. How to find the best Sourcing Agent for your Business — 7 Steps Checklist: 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.

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. Step 3: Choose a type of sourcing company As we have seen before, there are different types of sourcing companies. Then pre-select sourcing agents that meet the criteria you defined in step 1. Step 6: Negotiate payments Now that you have chosen a sourcing agent, you still have to negotiate payment with him.

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. Ready to Grow Your Business? Let us find the Best Sourcing Agent for you!

Find my sourcing agent. Bonus: 18 Questions to ask your sourcing agent. Where are you located exactly? How well do you speak the language of the supplier? How long have you been working as sourcing agent? Which products do you specialize in? How do you qualify the factory?

If I keep re-ordering the same products from the same supplier, will I pay less for your services after my first order? How does the process of working with you look like? Do you have a business license? Can I have a copy? Therefore, most companies operating in multiple product categories will appoint a sourcing agent in China. Some buyers already have experience importing from overseas, but most of their suppliers are actually trading companies.

But a sourcing agent is not necessarily better than a trading company, and it depends on your situation, which I will explain in detail in the following section. If a buyer purchases goods from several different suppliers and ships them in one container. The following problems will arise. There are 20 questions you can ask yourself to decide if you should engage a sourcing agent in your supply chain.

A sourcing agent can empower your supply chain in 5 main aspects, and you can consider these benefits when deciding whether to work with a sourcing agency and who you should work with.

If you have a decent order quantity, working with a factory is the next step in growing your company. A sourcing agent can help you distinguish between trading companies and factories and find a matching industrial cluster. Risks such as supplier fraud, low-quality goods, delivery delays, non-compliant goods, etc. This is an essential function of a sourcing agent to reduce the risk to the customer.

Doing everything yourself is sometimes the main reason why businesses fail to grow, and outsourcing some of the work allows you to spend more time on sales and marketing. In China, trading companies usually have salespeople who speak English, but factories only communicate in Chinese, and a local agent can ensure that the factory manufactures products exactly in the way the customer wants. Never take it for granted that the product you receive will be what you expect.

Your sourcing agent can inspect the goods on your behalf to prevent you from receiving a container of substandard products. With so many benefits to buyers working with a sourcing agent , is it always better to work with a sourcing agency than a trading company? Both have their advantages and disadvantages.

Disadvantages of working with a sourcing agent rather than a trading company:. However, if you already have a clear idea of what products you wan t, with detailed product specifications and estimated order quantities, a sourcing agent will be more helpful to you.

If the most significant advantage of working with a sourcing agent is that you can work with the factory, is it better to work directly with the factory without going through a sourcing agent if you can? Disadvantages of working directly with the factory without a sourcing agent:. Suppose your company has professional staff in charge of the supply chain, or you have a lot of import experience and can spend hours a day on supplier management.

In that case, I suggest you try working directly with the factory. You can compare your A-values with your B-values to determine whether you should work directly with the factory or through a sourcing agent :. If you are importing from China or have plans to do so, you must know about alibaba.

But why are there still many buyers working with sourcing agents even though alibaba. If you found a supplier at alibaba. Both sourcing agents and freight forwarders can arrange the logistics for you, and none of them own ships.

Only when the forwarder has many customers shipping to a certain country, they can use the shipping volume to bargain with the shipping company to get a good price for that particular shipping route. Therefore, a forwarder that is not focused on your country route is unlikely to offer you competitive prices. On the other hand, sourcing agents control logistics costs very similar to the method used to source suppliers.

Based on the priority of different variables, such as transport time, unit price per cubic meter, number of transits, weight limits, etc. Because shipping route conditions change every half month, a professional sourcing agent needs to compare and analyze more than 10 logistics options to ensure that cost, lead time, and safety are the best. As a buyer, there is no standard answer as to whether you should ship your goods with a freight forwarder or a sourcing agent.

It is in your best interest to consider both as equal logistics solution providers and compare their logistics solutions in advance before making a decision. A good sourcing agent can add value to your supply chain , but a bad one can increase your costs and be of no help to you. As a buyer, you should know how to identify these bad sourcing agents and prevent them from hurting your business.

However, some bad sourcing agents ask for kickbacks from suppliers, and they select suppliers based not on the quality and price of their products, but on the amount of bribes they offer. Some sourcing agents operate as trading companies, and they hide information about real manufacturers and use various excuses to prevent buyers from visiting factories. There is no standardized fee structure for different sourcing agents.

The specific costs are related to their charging model and how much they charge for a particular product category. The way how a sourcing agent charge is closely related to the cost you end up paying. Below I will explain how different types of sourcing agents charge for their services. Sourcing agents who charge an hourly or monthly fee are usually individual freelancers or one-person companies. They often act as virtual assistants to buyers and handle day-to-day communication with suppliers.

Some purchasing agents quote their clients a fixed price for each of their services before working together. Charge a percentage of the order amount Free Quote. Under a percentage commission charging structure, the sourcing agent does not charge for product sourcing services before working.

However, they quote the product price to the customer and receives a percentage commission for supply chain management only after the customer approves the sample and quotation. When choosing a sourcing company, look not only at which one charges a competitive rate, but also at what services they offer and how they will perform those services.

If the candidate sourcing company gives you a vague response, even if you get a good feeling from their website, think twice about choosing them. Some sourcing companies charge an initial fee before searching for a product and then charge a percentage of the order amount after the order confirmed.

But there is a downside to this fee model for sourcing agents, as the free quote model attracts many buyers who are not yet ready to import. Even though the sourcing agents have quoted competitive prices, the buyers did not place any order because of their own reasons. This results in a lot of wasted manpower for the sourcing company, especially for those who spend a lot of time and are serious about finding suppliers for their buyers. Some agents do not charge a flat fee for their services, nor do they charge a percentage of the order value.

If you have good guanxi with your supplier, it means you understand each other and are likely to help each other out in your business dealings. If you have bad or no guanxi, it means your partnership might not be mutually beneficial.

A sourcing agent is that all-important link that creates good guanxi in your dealings in China. They have the ability to do this through their local presence, communication skills, business insights and, perhaps most importantly, knowledge of cultural nuances.

This makes hiring the right China sourcing agent integral to a fulfilling sourcing experience and, eventually, to business success. However, working with a sourcing agent is also about getting the most bang for your buck. The right one will help you negotiate the best price for your product, but without compromising on quality and lead time. Striking a balance between the two is what needs your utmost effort.

Your sourcing agent will handle the rest, for the right price, of course! Sourcing Allies is a team of expert China sourcing agents that has helped western customers manufacture and source products from low-cost regions since For more on China sourcing visit our website or write to us at info sourcingallies.

White label products are generic products that you sell under your own brand. You can source the goods from China through several channels. This read will walk you through it. There is a growing realization among companies that moving manufacturing out of China may be possible, but it will not come cheap. Find out what that could mean for your business and how you can benefit the most by OEM and China sourcing.

Production Expertise. Chris Schell. Made in China. Sourced from China Go East! Flat fee With this model, you pay a fixed amount that is agreed at the beginning of the project. There will be no further costs. By First-rate Mold Solution Co. One Comment. Raymond January 15, at pm - Reply. Leave A Comment Cancel reply Comment.

Go to Top.