What is Product Sourcing and How to Do It?
Product sourcing refers to a business model where you get products in wholesale and sell them at a margin (profit). Product sourcing business can be done locally or internationally. You should understand the demand for the goods to avoid losses. Apart from that, you should ensure that the manufacturer is genuine, and the price of their products is fair. The most common methods of product sourcing are wholesale selling, drop-shipping, print of demand, and custom-made manufacturing. Each method has its dynamics and costs. Drop shipping does not require massive initial capital investment because you pay the supplier after selling. Other types, like custom manufacturing, are premium methods.
How to do Product Sourcing
Drop-shipping
It refers to buying products in bulk at discounted prices. It is ideal when you don’t have any manufacturers to source products. Though the business requires a warehouse to store the goods, you can make significant profits. In the wholesale product sourcing business, you can easily change your supplier. Apart from that, you can reduce or increase the size of your order, depending on demand. The profit margin is higher than drop-shipping but lower than manufacturer sourcing. You can meet potential suppliers in Prime Expo Exhibitions in Dubai, UAE.
Wholesale Product Sourcing
It refers to the process of buying products in bulk at discounted prices. It is ideal when you don’t have any manufacturers to source products. Though the business requires a warehouse to store the goods, you can make significant profits. In the wholesale product sourcing business, you can easily change your supplier. Apart from that, you can reduce or increase the size of your order, depending on demand. The profit margin is higher than drop-shipping but lower than manufacturer sourcing. You can meet potential suppliers in Prime Expo Exhibitions in Dubai, UAE.
Manufacturer
This method requires substantial capital investment because you have to show the supplier your company has a going concern. The perks of the business include control over the quality of the products. The manufacturer can make custom-made products to suit your customers. The business method has high-profit margins because there are no middlemen. If you have a warehouse, enough capital, and a willing manufacturer, this would be the best type of product sourcing.
Custom-made Sourcing
The primary advantage of this method is the monopoly. It is also known as DIY-sourcing. The process also gives you complete control over the outcome of your product. Because of the uniqueness of these products, profit is usually high. However, it is challenging to get custom-made products in bulk. Thus, limiting the gains, you can make. You should also remain creative and keep inventing new products to maintain uniqueness.