How to negotiate for MOQ

A lot of potential retailers seem to ponder if there actually has to be a need for a minimum order quantity. This is because plenty of manufacturers insist on Minimum Order Quantity before they commence production. There are some things that buyers need to take into consideration while buying negotiating quantities with manufacturers. MOQ is the term allocated for a quantity of the minimum number of products he can sell so as to comfortably make a profit. The MOQ could vary according to the product in question and the most costly the item is, the lower the MOQ would become. This is vice versa in the case of less expensive items. The MOQ is set by the vendor or the manufacturer in a majority of cases and is based solely on production batches. The reasons why manufacturers request for a minimum order quantity are several. The MOQ is calculated with a view of securing the profitability of the business. Usually the fixed cost of the manufacturer will never justify the tiny orders. Every time an order is processed, the manufacturer needs to develop the item and invest a significant amount of time and cash into the designing and execution of the product. This also includes of purchasing equipment and the necessary tools that are needed. Time and energy is needed also to make individual samples, and prototypes as a lot of potential buyers insist on that all the time. Even the manufacturer needs to purchase his raw materials on a MOQ basis from his raw material supplied. If the product is a t-shirt, then the apparel used to make it might be sold to him on a minimum order quantity. When the batches are pre-ordered, the factory will get a longer commitment than the one that has been offered. Manufacturers generally prefer producing to larger orders because it is far easier to process. If you are looking for a small quantity, it is better to consult a small timer who would take your order seriously and would be able to attend to the work efficiently. It’s important to negotiate with factories that match your requirements. It does not have to be a full container in order to negotiate MOQ.

Author: Todd Johnson
Email: Todd@australianwebsitedevelopment.com.au
Mobile: 0449 041 815