Minimum Order Quantity (MOQ) – What Is It About?

Minimum Order Quantity or popularly abbreviated as MOQ, is an absolute term you should be accustomed to if you’re into the art of business. As a business enthusiast who wants to import and resell, MOQs kind of rules that industry. So, it would help if you understood the basis of its operation.

An MOQ is an acronym that refers to the minimum quantity of goods a manufacturer is willing to produce and supply at a particular time. It is the least quantity a supplier will sell to a buyer at a time.

You may ask, “Why is it so necessary to operate with this?” It is simple. The supplier needs to ‘break-even.’ Operating with MOQs helps regulate the production costs and profit generation for the supplier.

A supplier might not go below this quantity, so they don’t incur losses after production.  The number of units produced should cover the cost of production and still make a profit. This is what is referred to as breaking even.     

So, it would be best if you weren’t disheartened when you find out that you cannot afford the MOQ of a particular supplier. Others may have MOQs you might be able to meet up with. Otherwise, there are ways to meet up with MOQs of suppliers you are interested in. This is when negotiation comes to play. Yes! Negotiation is allowed.

Here are some tips you can use to meet up with MOQs of suppliers:

  1. Suggest to the supplier that they should use lower quatity materials in the production of your product order. This might cost less, and you will be able to meet up with their MOQ.
  2. Partner with another buyer. You can split the MOQ into parts, and you all get the quantity you need. Sounds great?
  3. Find suppliers who work with installments. You can order the whole MOQ and get them bit by bit.
  4. Consider products that are not custom made. Custom made products will have higher MOQs than those that are pre-produced.
  5. Consider buying easy-to-produce goods. Lesser time and lesser cost of production will reduce the MOQ of the supplier.
  6. Be polite and straightforward when making such demands. Some suppliers will appreciate the idea of long-term relationships. Hence, good manners will be needed.

With these, approach the suppliers and give it a try. You might never expect the outcome. Remember, MOQs are bendable and adjustable. You have to find the right suppliers suitable for your needs.

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