sourcing business

**atanabe** · 08-14-2009 08:09 AM

dear all,
i am planning to launch a sourcing business here in china, and connect people from my country who want to source products, materials or manufacturers here in china into some list of suggested industries. But one question is just holding me back before launch if its valuable to do the business or not: Why people will come to my company to source the would be product and pay commission instead of just going directly to canton fair and source themselves directly their suppliers?
I was really thinkin it could be a good business cause i don't see yet any company here sourcing professionally for my country.
If somebody have had sourcing experience, or want to exchange or share ressources, advice with me, feel free to P.M.
Thx

**dinhquanghuy** · 08-15-2009 10:47 PM

hello atanabe ,I'm new to this forum but I'm very interested in your idea and I think you will get success immediately with this idea .Why? because sourcing is the most import task for all wholesaler and retailer ,they can get scammed at when sourcing in internet . I got scammed twice and I think a sourcing business is very helpful with wholesalers like me . in internet ,there are people who selling real source and contact list of manufacturer for making money ,so you will make money with this sourcing service . The most important to attract customers in crisis time is decrease your mark up .
Do you work in electronics section ? We are looking for consumer electronics and mobile phone sources in china ,so we will be your first customer if your service is at acceptable price .
Contact me in MSN : metalner(at)gmail.com for more detail in sourcing business and our request for source.Thankx

**atanabe** · 08-16-2009 08:50 AM

hi dinhquanghuy , thank you for your support. I was really thinking thousand time before realizing that sourcing business is a compromise for low budget entrepreneurs to start up. anyway I think this business is not out of risk because you share some risk between manufacturers and buyers, you should satisfy them both.
For my question, I am still waitin for objective reply and help from those who had some experience in sourcing. I plan also to widen my business as a transit later as my sourcing business will works fine.

**inle** · 08-17-2009 03:18 AM

What values can you added to your customers with the sourcing?

**rpermana** · 08-17-2009 04:00 AM

Why they don't go direct ?

1. They will not come to you unless your price is competitive. To obtain a good price, you must know your supplier very well which your customer does not have. Because you order a lot from that suppliers, means you must have discounted price from them.

2. Customer comes to you because they do not know where to get the cheapest deal & best quality.. US, China, India, Singapore ?? This is what you need to have.

3. Customer usually has their own business to run, and do not have time to source for all these. So, they basically look for a buying house / sourcing company which do all the work for them with certain percentage. They do not care where you get them around the world, they just want to have the products in front of their table and safe all the hassles.

4. Trust.. They know you and they won't get scammed.

5. They do not need to do wire transfer payment to overseas suppliers all around the world. They just make payment to you... This might save time also.

6. Language barrier.. This is what im facing sometimes. I planned to build a relationship with a supplier in Japan, but i can't speak their language and their english is hard to be understood.

7. Protect price. This is the most powerful strategy. If the supplier is my best friend, i can tell him to protect the product / price from all my customers and also my competitors. If they want, they have to go through me.

Edit : When you say connect people in your country. Which country are your referring to ?

**atanabe** · 08-17-2009 04:58 AM

inle> I can save my buyers' time, because while thiy stay busy with their business, I prepare for them the best deal for the best quality at a resonable price, It save also many headache for new customer who never sourced in China. Money saving is also a point because customers doesn't spend money to travel for big deal and stuff since I have also offie in my home country, this is very strategic, trust is increased because they can always get in touch with us and with manufacters via our local office. ...
rpermana>thank you for those very meaningfull advice, its noted.
when you say best deal at the best price, I think it's the key argument for this kind of business, we know many suppliers so we can compare price & quality for buyers. that's it!
-Let me to unveil later the country i am referring to for business purposes, I hope you will understand me.

**rpermana** · 08-17-2009 11:44 PM

Originally Posted by atanabe

rpermana>
when you say best deal at the best price, I think it's the key argument for this kind of business, we know many suppliers so we can compare price & quality for buyers. that's it!
.

that's when all the tactics come in, including my last point (talk with manufacturer & protect price). If you have the best strategy / tactic, you will be the winner...

**Evac** · 08-18-2009 02:37 AM

I am a manufacturer, and I do not pay much attention to sourcing company, except they are sincere to cooperate.

The main reason is very simple. When they source, they did not understand what the buyers really need sometimes. Then I ask some more details of the request, like function, appearance, material or others, they are uncertain and have to ask the buyers, and then they are disappear, whatever I asked some times after that.

Otherwise, some sourcing company is very professional, save much time and energy to understand the details. I really appreciate that.

**rpermana** · 08-19-2009 04:20 AM

Evac.. sourcing companies do source like 10,000 + over materials... of course it is not possible for them to know all ... like me, i do source from home appliances, oil & gas factory parts, tricycle, to tug boat parts

they don't come back to you, because they might be a better manufacturer who is more open and willing to help.... they usually list out like 10 different specs with 10 different price for me to choose.

**atanabe** · 08-19-2009 01:03 PM

I was deeply thinking about this business. The key of key is the value added that you can give to your customer. here make A difference will boost sourcing business. here are some listing I was thinking about these value added:
-provide translators for free, I can do so by paying monthly salary to my translater.
-provide zero commission transaction: really give to buyers, the prices as is from the manufacturers. (in china exporters are encouraged to export, so government give them back the product taxes form each item exported, here is my benefit).
-deliver goods locally: I could do myself, and include in my business the transit of all orde r like ship all good ,pay import taxes. (This is not anymore sourcing but is a logic continuation of it, I will quote it with extra fee)
- and so on...
evac> the advantages of sourcing companies is: they now where are buyers and the bring it to you, so i some ways, they lighten your business and contribute to your development, isn't it?

**Mark Jackle** · 08-25-2009 04:32 AM

Business sourcing, company phone people. Business sourcing, people: this faculty should be referred by the roots that was associated when the song business was done.

**eileen521** · 09-01-2009 04:48 AM

Originally Posted by rpermana

Why they don't go direct ?

1. They will not come to you unless your price is competitive. To obtain a good price, you must know your supplier very well which your customer does not have. Because you order a lot from that suppliers, means you must have discounted price from them.

2. Customer comes to you because they do not know where to get the cheapest deal & best quality.. US, China, India, Singapore ?? This is what you need to have.

3. Customer usually has their own business to run, and do not have time to source for all these. So, they basically look for a buying house / sourcing company which do all the work for them with certain percentage. They do not care where you get them around the world, they just want to have the products in front of their table and safe all the hassles.

4. Trust.. They know you and they won't get scammed.

5. They do not need to do wire transfer payment to overseas suppliers all around the world. They just make payment to you... This might save time also.

6. Language barrier.. This is what im facing sometimes. I planned to build a relationship with a supplier in Japan, but i can't speak their language and their english is hard to be understood.

7. Protect price. This is the most powerful strategy. If the supplier is my best friend, i can tell him to protect the product / price from all my customers and also my competitors. If they want, they have to go through me.

Edit : When you say connect people in your country. Which country are your referring to ?

Very good analysis

**Shokoya** · 09-02-2009 07:18 PM

We live in an age where people are prepared to pay good money for information. As a sourcer, you are providing valuable information that allows 2 or more parties to connect and do business. This makes you a 'connector'

Good connectors make good money. One of my businessess is real estate investment company that connects investors with opportunities all over the world. I source, they buy from vendor and I get paid for my services.

Based on my understanding of what you want to do, the key to your business success lies in having the right contacts, exposure and level of service (go above and beyond).

Your start-up costs should be relatively low (mainly time investment), so if i were you, I'd tell the little cautious voice in your head to take a back seat for a moment, then I'd get out there and start building contacts and gaining exposure.

A lot of people from all over the world are looking to China for their products. And all you need is a few lucrative clients/contracts to make some serious money.

**atanabe** · 09-11-2009 10:57 PM

Shokoya> sounds good, a step back, a valuable connection, I will consider that too.
But connection is mostly established as a mouth to mouth voice. So don't you think, setup first the business is a preliminary step? even if it works only virtually?