what is a sourcing agent

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A sourcing agent is a person or organization that represents a buyer in finding commodities or purchasing things that are out of the buyer’s budget. Sourcing agencies or sourcing firms are frequently required in international trade.

Traditionally, a sourcing agent’s sole responsibility is to find suppliers for his clients. Indeed, sourcing agencies can provide services such as identifying the proper supplier, negotiating prices, monitoring manufacturing, quality control, product compliance and testing, shipping, and so on.

It is not stated that sourcing agents or corporations are required to supply the entire range of services. The scope of work is determined by the mutual consent of both parties.

Sourcing Agent VS Sourcing Company

In the global market, these two words are frequently interpreted interchangeably. For example, if you want to find someone sourcing for you, you can say – I need a “sourcing agent” or a “sourcing company”, it doesn’t matter. But they are actually two distinct things.

Sourcing Agent

A sourcing agent can be a single sourcing agent who works full-time for you. Individual sourcing agents typically employ one or two persons and work from a small office or home office.

Some of them may have years of experience working for a trading or sourcing organization. These individual sourcing agents can be found on some freelancing platforms (such as Fiverr and Upwork), and a few of them may have their own Google webpages.

Sourcing Company

Sourcing company is also known as sourcing agency. It is simple to understand: a sourcing organization is supported by a staff of skilled sourcing agents and organized apartments such as sourcing, quality inspection, warehouse, and shipping systems. They can integrate supplier resources more efficiently and service several buyers at once.

Sourcing companies are typically located in industrial clusters. For example, the majority of China sourcing agents and enterprises are based in Yiwu, Guangzhou, and Shenzhen, China.

Both sourcing agents and sourcing firms function as intermediaries between buyers and suppliers, and it is entirely up to you which one you wish to work with.

What Services do Sourcing Agent Provide?

Sourcing service fees vary depending on the job scope you want from the agent. So, before you begin working together, make sure you have a clear understanding of the service scope and pricing. That is why I devote one chapter to introducing the services of sourcing agents and companies.

Following are the main services most sourcing agents provide:

Sourcing Product Suppliers

Every sourcing agent’s basic service is to verify and pick suppliers who meet their clients’ criteria. And they will negotiate with the supplier on the buyer’s behalf to obtain the best pricing and confirm manufacturing details.

However, some purchasers may be perplexed as to whether the sourcing agent or corporation should disclose supplier information to them. Some believe the agent is defrauding them or making dirty money by withholding supplier information from them.

Let me explain. Whether or not the buyer receives supplier information is determined by the sourcing agent’s service model.

Individual sourcing agent

Some individual sourcing agents can be found on Fiverr or Upwork, and they are typically paid a fixed pay (per hour/day) or a fixed commission for a single assignment. This type of cooperation is similar to locating a sourcing assistant in a foreign country.

Essentially, the buyer pays the agent’s salary to obtain supplier information, therefore it is the agent’s responsibility to send the supplier’s contact information to his boss–the buyer, and the buyers will speak with the suppliers to negotiate the price.

Sourcing company/agency

If it is a sourcing company/agency, the supplier information will not be sent directly to the buyer. The following are the two main explanations.

For starters, these quality suppliers are their pooled resources (including those that cannot be discovered on B2B platforms), which allows you to negotiate a competitive price with the sourcing organization.

Second, they charge their service fees as a proportion of the entire worth of the goods, which is their business model. (I will go into the sourcing agent/company charge techniques further in question 5 later).

Although they are not revealing the buyer the factory contact information, they are willing to take the buyer to see the facility and let the buyer have a certain grasp of the production ability of the factory. However, this frequently occurs with larger orders. Buyers who order tiny values, such as $1,000 shoes or $1,000 caps, are less likely to travel to the factory overseas.

Follow-up Production, Inspect Quality, and Arrange Shipment

After identifying a suitable supplier, it is time to plan the manufacture of items. Sourcing agents/companies will assist in coordinating with the manufacturer, overseeing the entire manufacturing process, and ensuring that the facility completes production on schedule and produces high-quality goods.

They will also provide quality inspection services. They will work with the quality inspection firm to inspect the finished items and reduce the defect rate before shipment.

The final step is shipping arrangements, which need a high level of competence. Because, in addition to offering the most reasonable shipping charges, they will need to tell you of the documentation and product certificates that you must prepare for customs, such as CE, RoHS, FDA, COC, and so on.

Most sourcing agents or companies offer these services. You can select any of their services based on your own needs.

Other Services

In addition to the mainstream services mentioned above, some large professional sourcing companies also offer private label solutions, including but not limited to the following aspects:

• Customize the product
• Customize packaging/labels
• Free product photography for e-Commerce

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