Product sourcing defined

In simple terms, product sourcing refers to looking for or obtaining products for your company. These processes entail purchasing products for sale at actual wholesale prices and promoting them online with an intention of making profits. Product sourcing is therefore a basis for success as an online marketer.

In order to get the best products for your business, you need to have a firm procurement process. This will help you get the best prices in the market. For your business to experience profits, you will need to also have credible supplier network, market situation intelligence and long-term cooperation.

Business Products Sourcing

In general, businesses that are small and starting are the major sources of new products often times associated with big corporations; Bakelite, air conditioners, gyrocompass, FM radio, pacemaker, frozen food, PCs, soft contact lenses among others. Small businesses can craft a competitive edge with valuable finance or physical resources by giving the customers more value with their new product offerings.

In product sourcing, you can choose from two options; you can procure products straight from manufacturers or buy them from retailers. These two options have their respective pros and cons as discussed below;

Buying From Manufacturers

This is a fairly hard option. Manufacturers will need you to prove without any doubts that you are capable of sustaining your request. If you fail to show this, the manufacturers will deem your request as economically unviable.

It is also hard to procure products from manufacturers because this requires a lot of capital, space and facilities for storing. It is notable that if you are able to convince manufacturers that you are economically and commercially viable, the cheaper prices offered will go a long way in increasing your profits.

Why Go to the Manufacturers?

  1. Reasonable Prices: Manufacturers offer the best prices in the market for their products.
  2. Bulk Quantity: In general, manufacturers sell their products in large quantities. If you are looking for small quantities like samples, then they are unlikely to oblige.
  3. Quality for Products: Manufacturers offer the best in this.

Manufacturer Analysis

First of all, you need to be careful about the identities of manufacturers. Retailers are known to sometimes camouflage as manufacturers and sell their products to you with their own prices. Their prices may be much higher than what the manufacturers offer. Here is what you need;

  1. Reference check: it is of utmost importance to cross check so that you are sure you are dealing with a legitimate partner. Contact others who have used that wholesaler or manufacturer. You may also consider getting information from the Better Business Bureau. If you find that the manufacturer you are examining is also asking information about you with an intention of proving your legitimacy, this is good. Give them your business licenses and information about taxation.
  2. Weigh the options at your disposal: in order to make informed decision, you need to get answers from the company that is in consideration. Some of these questions include the following;
  • How much will it cost? Consider expenses incurred such as in production, shipment and other costs that may not be overtly visible.
  • How long will the process take? Time taken for production and shipping.
  • What method do they use in the shipment process? How is the management of inventory? Are they charging for shipping and storage or is this included as a service? Are there hidden charges? Get information about their timelines, terms and conditions. Who controls branding and packaging?
  • Will you need to enter into a contract? If so what are the terms? Is the arrangement flexible to accommodate the needs of your customers? When are the evaluation periods and conditions for termination?
  • How does their communications, help and support look like? Are they able to constantly update you on discounts, product changes and inventory?
  • Are there minimum order quantities or minimum amount of money that you must spend over a certain period or any time that you are making purchase?
  1. Check reports at your disposal

Source for and read all sector-specific reports and tabulations to know whether you need to research further. Some reports are in fact full of information that can help you avoid full industry research. You should be careful with these reports bearing in minds that the market is still yet to stabilize while industrial issues are always varying. You therefore need to check the very recent reports relevant to market situation.

  1. Delve into the right industry

Bearing in minds that the industry is composed different components and areas, you should be sure to focus on the one that concerns you. For instance, fertilizers, paints, pesticides, vanishes, organic chemicals are sub-industries in the chemical industry. Get the proper sub-industry to make a relevant analysis.

Buying Products via Wholesale Suppliers

Buying your business products from wholesalers is easy when stocking your business especially when you are just starting up. Wholesalers are quick at providing you with products in somewhat large volumes at favourable prices.

This is good because you do not require a lot of capital in order to buy from the wholesalers. These will allow you to order low volumes of products as you can afford unlike the case of manufacturers. Although the profit margin gotten from buying from wholesalers is smaller, it is worth it if your business is small and just starting.

What to expect from the wholesalers?

  1. Higher Price: The price here is higher than what you get from manufacturers.
  2. Low Quantity: They offer you products in low volumes, even samples.
  3. Variable Quality: The quality of products varies depending on prices.

Things you should do when sourcing product


  • Maintain┬áinventory of products sourced

In order to sustain profitability and satisfaction to your customers, you should always be adding new products in your business. Your products will still need to be replenished

  • Do Proper research.

If you get a good product that is within your affordability, make sure to do proper research to know whether it will appeal to your customers.


  • Pursue winning business models


In order to succeed in business, you must be prepared to pursue successful business models. You should also try to buy a good from your business competitor. You can check their packages and see who their sellers are. There is nothing sinister in this kind of research.

  • Go offline.

Attend forums where you can personally make business relationships with manufacturers and help you in procuring products.

SellerKai’s Sourcing helps small business owners and Amazon sellers to connect & deal with the most suitable vendors. We handle every process ourselves as your personal agent. If you want any product sourced from China, then we can help you to link with manufacturers or retailers and handle all shipment work at our end. We have access to those vendors that are not on Alibaba and have much lower price than the vendors on Alibaba.