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    1. Cath01's Avatar
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      #1

      Tips to get better Wholesale Prices - Getting Lower MOQ's

      I’m new in online trade, and have been quoted some pretty unreasonable sounding quotes from the handful of suppliers I’ve contacted. Prices that would give me an almost pointless return on my investment, with minimum orders that strain my available capital. Are these prices intended to be bargained down? Is it kosher to try and haggle for a lower price?
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      It’s rare that a distributor or wholesaler is going to quote you a price with absolutely no room to move. It does happen, but it’s not common. That said, if you’re a start-up, like many of us here, then you’re going to have a hard time convincing them to come down terribly much without proving that you can move a high minimum order quantity (MOQ) or provide consistent business over the long term. Keep these points in mind when dealing with suppliers--

      ● Don’t try to force yourself into negotiations. Like I said above, some distributors just won’t move on their prices, and continuing to berate them once that’s been made clear will just put folks off. Keep in mind that you’re in the weaker position here, as you aren’t an established vendor with a proven track record.

      ● You can’t think of this transaction only in the context of short-term profit, and you certainly can’t let price alone determine your choice of supplier. You’ve got to look at product quality, delivery time, and support. That’s all packed into those quotes, so consider this as well. If the combination of cost and a high MOQ are keeping you away, and they’re firm in their pricing, then negotiate another aspect of the deal. Go for payment options, MOQ, or delivery time.

      â—Ź Remember that negotiation is about give and take from both sides, not just your getting what you want. If you want lower prices or MOQ, offer something in exchange. Offer up-front payment, agree to purchase a certain amount each month. Both sides should feel like the deal benefited them, rather than either feeling like they got screwed.

      ● I’m sort of burying the lead here, but I’m writing points as I think of them. You want, first and foremost, to establish a long term relationship with your sources. If you prove over time that you can be depended upon for consistent trade and a reliable client, then you can leverage that capital into better prices, etc. Get to know your suppliers, especially if they’re local. Take a couple boxes of donuts to the warehouse, get friendly with the office staff, and absolutely get to know the managers. Even if you aren’t local to the distributors, you can meet up with the grand-high-mukity-mucks at trade shows and the like. Buy a round of drinks after the show, attend post-show open houses. I’m serious here, a solid relationship will work strongly in your favor. Keep in mind that you’re dealing with people here.

      ● Never accept the first quote from a wholesale supplier. This is a bit of a tradition-- the first offers given are intended to be negotiated. Go with a lower counter-offer, and you’ll likely get a better deal. In your case specifically, if the combination of price and MOQ makes the deal undoable on your end, you’re likely expected to negotiate.

      ● On the opposite end, don’t accept an offer that seems oddly low. Trust your gut, and if a deal seems too good to be true, ask why it’s so low. Is the merchandise sub-par or damaged? Is the quoted price intended to rope you in, while the supplier lashes you with ridiculous high shipping charges? Remember, price is only one aspect of the deal, and you want to make sure you aren’t so busy drooling over the dollar cost that you’re missing out on quality products, reasonable support, and acceptable delivery times.

      ● Make sure you actually need everything being folded into the price. Just like price isn’t everything, the individual product in offer, isn’t the sole determining factor in the quoted price. Sources will sometimes include things like expedited shipment, compensation for free shipment, account managers, and a number of other services in the quoted price. Don’t be afraid to ask of what the price is composed, and if it’s possible to reduce that price by stripping away a few of the perks.

      ● Always go for bulk if you can at all, handle it. A wholesale supplier or distributor is going to see better margins in large orders, and so it’s to their benefit to work bulk orders and discount prices for them.

      ● Again, remember that you’re dealing with business people with the same goals as you-- to make a profit. Treat them like professionals, and handle the negotiation process with respect. Don’t ask for ridiculously low prices just because you think you can get away with it. Both sides of the bargaining should end up feeling shiny at the end of the day.

      To reiterate the main point here, you want to build a relationship with your sources, first and foremost. Certainly, don’t let yourself get shafted just because you’re starting up, but don’t be too pushy until you’ve proven yourself a benefit to their trade. Once you’ve gotten yourself established as a reliable client, then you can start asking for a little bit extra.
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    3. Thank you for this post:

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      #3
      A lot of distributors have what’s called “customer councils”, “client boards”, or something similar. Basically, it’s a pseudo-advisory board composed of their top clients. You want to be on those things. It’s these boards they go to for answers to client-centric questions, trying out new deals, and the like. Likewise, you want to be on your source’s top 20 list of clients. Make yourself valuable, and you’ll be cut in on special deals.

      In fact, one of the ways you can establish yourself as a definite benefit to your source is by offering to take as many of the special deals and the like that they offer. Prove to them you’re willing to support them in most endeavors, and you will be rewarded.

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      #4
      Sound idea, but if you’re going to jump on a lot of these deals, make sure you aren’t putting yourself to disadvantage in the process. Tell your supplier that you’re willing to help them out on this, but ask if they’ll allow you to return the featured product for credit should it not perform as expected. Remember that bit about both sides benefiting, it applies to your end, too. Don’t let yourself get exploited, especially early in the game.

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      #5
      Holy crow! Didn’t expect an essay. Thanks so much for the insights, guys. I’ve got a much better idea where I stand in this industry now.

    7. sumlong is offline

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      #6
      if your purchase are very active, most wholesalers are happy to lower the MOQ. i think.

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