How to Find Low MOQ Alibaba Supplier? Here is the complete guide
Why can’t you get the Chinese low moq alibaba suppliers for just starting off personal branding?
How to find a lower MOQ Alibaba supplier ?
Now, we will talk about negotiating with Chinese suppliers for a lower MOQ step by step.
As a first step, you need to understand
what is MOQ?
MOQ means minimum order quantity. Usually, it is involved with customized goods or the goods not in stock.
a supplier has a women’s watch in stock without a requirement for a MOQ initially, but you want to customize the packaging, appearance or some other functions of the watch, the supplier will then ask a MOQ for it.
Why MOQ is important?
Of course, when you buy spot goods, there is a low MOQ or even no MOQ requirement, but it will be a low margin business. Imaging that all competitors can easily sell the same products, it could cause serious product homogeneity and fierce competition.
Then why supplier needs MOQ?
Subjectively speaking, some factories don’t like small orders and they want to make more money by asking you to meet their high MOQ requirement.
Objectively speaking, suppliers indeed need a MOQ for their business. In certain cases, they may have a MOQ requirement for a manufacturing component or raw material from their upstream suppliers.
Take pillowcase for example, a fabric supplier requires a textile factory a MOQ for fabric dyeing, typically 300kg. Say the textile factory can produce 1000pcs pillowcases with this 300kg fabric, they will have a MOQ requirement for you as 1000pcs. If you only need 300pcs, they would lose money.
Sometimes, there is a machine-setup fee for products like poly bags, memory foam, etc. The set-up cost is fixed regardless of the order quantity. So if your quantity is lower than the factory’s MOQ, they would also lose money.
After understanding the reasons for MOQ, let’s move to the next step:
how to negotiate with suppliers.
Do not negotiate MOQ at the beginning. Instead, you should let suppliers know you are serious about doing business with them. You could start with introducing yourself and asking common questions about sample availability, price, order lead time, payment and shipping options, etc. When you start to negotiate, show your confidence and strength, so don’t say words like I don’t have a lot of money or I’m not sure if the product is going to sell.
I recommend choosing 3, or at least 2 suppliers for comparison. Ask them the same questions and get their samples. Usually, suppliers can offer a sample, sometimes even for free if the sample is not expensive, and normally you need to pay the shipping fee. You can ask suppliers whether they can cover the sample fee later after the order is placed. Some suppliers are willing to cover the sample cost for you.
The reason why we want a low MOQ is to control the business risk and cost, especially for new products. For example, whether the product will be popular in the market or not? Can this supplier keep making good quality product consistently?
After checking every detail, you are readyto negotiate the MOQ with suppliers. Keep in mind that it is reasonable to lower MOQ from 1000pcs 500pcs, but probably not from 1000pcs to 200pcs.
Let’s say we are expecting a MOQ of 300pcs.
The supplier may not agree with the 300pcs quantity, because it is way too lower than the required MOQ of 1000pcs.
You should negotiate several rounds to know the real acceptable MOQ and the reasons for that.
In the first step, you just ask them to reduce MOQ. You can talk to themlike, “The only problem is the MOQ. I only need 300 for a market test at the beginning. If it goes well, we will make a big order next time.”
Or, “The first order is a test order for quality, packing, and service. We really hope to find a good supplier for a long cooperative relationship, can you make the MOQ to be 300pcs for us?”
If the supplier says no. You may change a wayn and can say: “We waste money on the previous order, you know the shipping fee is expensive for small orders, we hope to earn money in the next order.”
If the supplier still says no, we can know the MOQ of 1000pcs is obviously real, otherwise, the supplier will lose money, that’s why they require on the requested MOQ.
Then we should let the supplier know they have a chance to make big money in the next order. We are helping them to sell this product.
“Our brand has a great scale in this bussiness area, if we cooperate this time, your factory will be one of our suppliers for other products”.
Or you can say like this
“We invest money on ads, design, package and photography. we think we have a big change to win and it will be a much larger order next time.”
At this point, some factories will reduce their MOQ more or less, say 800pcs.
But it’s still much more than the expected 300pcs. You should let him/her ask the manager/boss again, and give him/her a deadline.
If the answer is still no, it’s highly possible the number is a real MOQ and there are two options for you now. The first one is to give up this product and choose other products instead. But if you really want it, you can choose the second option.
Negotiate with the supplier for the last time. Do something to narrow the gap with the supplier’s expectation and here are some choices:
1. increase the MOQ. The supplier won’t change MOQ or they lowered MOQ to 800pcs after negotiation. You can increase MOQ from 300pcs to 500pcs and give it a try.
2. offer a little bit higher price. If you really don’t want that much, you can increase the price, like from 2usd a piece to 2.2usd.
3. Send order to supplier to show that your negotiation is not fixed, it is flexible.
Take my real case of buying a customized steel-made accessory as an example.
Background: I chose 3 suppliers and asked the price and MOQ already for comparison.
Below is a brief dialogue.
Me: Can you make this and what’s the price?
Supplier: Yes, we can do that, the price is 5 Yuan/piece. But if it is a customized product, the MOQ is 3000pcs.
(the other 2 suppliers’ MOQ ranges from 3000-4000pcs, so I know the real MOQ should be around 3000pcs)
(the other 2 suppliers’ price ranges from 5-6 Yuan, so I know the price should be around 5 Yuan)
Me: Give me the lowest price as you can, I am looking for a long-term supplier.
Supplier: 4.5 Yuan.
(First bargaining of the price. Do not let the suppler know your real expectation of the price and the quantity you gonna order at first. Conversely, you should know his price, quantity and other information)
Me: MOQ is too high for us, can you make it to be 2000pcs?
Supplier: No, the MOQ is not big.
(But I only need 2000pcs, it is an accessory, if I order more than 2000pcs, the extra ones are useless. Therefore, I cannot increase MOQ. I can increase money, I know it has MOQ for machine setup)
Me: I need 2000pcs in this first order, but if it goes well, we will buy this accessory regularly. (Give supplier a hint that they will make more money from regular orders)
Supplier: My boss said ok, but the price will be 5.8 Yuan.
Me: I can offer 5.3 Yuan, if you agree, we may place an order.
Supplier: I asked my boss and 5.3 Yuan is ok. (actually, this accessory needs a mold fee for 1000 Yuan, I also cut the price down to 700 Yuan)
This is an easy case for your reference.
In conclusion: low moq alibaba suppliers
1. you want to compare different suppliers, 2-4 suppliers typically , at least 2. It helps you know better about price, quality, service and industry knowledge, and you can get the best result after comparison.
2. If you know nothing and just go ahead to cut the price from 5 Yuan to 2 Yuan, or cut the MOQ from 3000pcs to 300pcs, suppliers would think it’s a joke, you don’t mean to cooperate with them seriously.
3. Lastly, remember that negotiation is a process of compromise. Sometimes, you need to compromise a little bit to get more compromise from your suppliers and believe it or not, you can always get lots of benefits from it.
Also you can find a sourcing agent to help you find Low Moq Suppliers in China or Alibaba.
Leave a comment to tell us your MOQ alibaba thoughts.