We got many inquiries from founders who want to choose a sourcing partner, and they often face quality problems, pay too much, or have delays. If you choose the wrong one, your money, time, and trust can disappear fast. If you choose the right one, you can grow your business with confidence.
Sourcing agents work like your buying team (they charge 5–10% commission), trading companies act as middlemen (they add 15–30%), and factories offer direct prices but require large MOQs, and you have to handle quality control yourself. Each type suits different needs and levels of risk.
Knowing these differences helps you save money and reduce risk. We share real experience from years working in China, so you can make faster decisions, avoid problems, and build a strong supply chain. You can read more on Green Sourcing Blog and Green Sourcing.
Sourcing Agent vs Trading Company vs Factory: What’s the Difference?
Many people mix up agents, traders, and factories. Choosing the wrong one can reduce your profit and cause hidden problems that appear after you pay the deposit.
Agents work for you and deal with different suppliers, traders sell products from their catalogs, and factories make the goods but you must manage specifications, quality, and communication during production.
We have worked inside factories, negotiated with trading companies, and built agent systems to protect budgets. A sourcing agent is like your local buying team. They look for suppliers, check backgrounds, negotiate, set up quality checks, and handle shipping.
A trading company buys from factories and sells to you. It’s easier to work with, but you pay their markup and have limited customization.
A factory makes the products directly. You get the best prices, but you must take care of communication, management, and quality issues yourself.
For startups and brands with many SKUs, agents reduce workload because they combine suppliers, lower MOQs, and manage quality plans.
For stable, high-volume products, working directly with factories can be better if you have experience.
For simple bulk goods, trading companies are fast to work with but cost more.
In this article, we will compare “sourcing agent vs trading company vs factory” with real cases and data from our Green Sourcing internal benchmarks.
Sourcing Agent – Your China Buying Team
- Role: act as your local team for different suppliers.
- Works for: you (the buyer).
- Scope: supplier checking, negotiation, quality control, shipping, and consolidation.
- Commission: usually 5–10% depending on scope.
Trading Company – The Middleman
- Role: reseller with a product catalog from many factories.
- Offers: easy process, moderate MOQ, basic communication.
- Doesn’t offer: strong quality or engineering support.
- Markup: 15–30% added to the unit price.
Factory – Direct Manufacturer
- Relationship: direct with production.
- Advantage: best factory pricing.
- Challenges: language, quality, and engineering management.
- MOQ: usually high and based on production; 1,000–5,000+ units common.
Side-by-Side Comparison Table
| Factor | Sourcing Agent | Trading Company | Factory |
|---|---|---|---|
| Primary Role | Your buying team | Product reseller | Manufacturer |
| Works For | You (buyer) | Themselves | Themselves |
| Price Structure | Factory price + 5–10% commission | Factory price + 15–30% markup | Direct factory price |
| MOQ | Flexible | Medium | High |
| Quality Control | Full service | Limited | Managed by you |
| Customization | High | Limited | High (needs experience) |
| Communication | Fluent or Fair | Fair | Sometimes difficult |
| Supplier Options | Many suppliers | Limited | One factory |
| Best For | Small businesses, startups, multi-SKU | Simple bulk orders | Large-volume single items |
Which Is Better for Small Businesses: Sourcing Agent, Trading Company, or Factory?
Small business owners often face tight budgets, small orders, many product types, and limited experience.
For most small businesses, sourcing agents are the best choice. They help lower order quantities, check quality across suppliers, and act like your local team — making things easier without forcing you to buy too much.
Small teams need clear prices, quick action, and fewer mistakes. Many new buyers spend months searching for suppliers and lose money fixing problems that could have been avoided.
A good sourcing agent can save time by using trusted suppliers, combining shipments, and controlling quality.
If you work directly with factories, small mistakes like wrong colors or missing parts can cost extra money and delay shipping.
A sourcing agent gives you a clear picture of your total cost, including samples, inspection, and shipping.
Trading companies are fine for simple, ready-made goods, but their markup raises your cost and limits your choices.
Working with factories directly works when you already have stable orders and clear product plans, but that’s not common for beginners.
When comparing “sourcing agent vs trading company vs factory,” agents help reduce risks and keep flexibility — important when you’re testing new products or just starting.
Why Sourcing Agents Work Best for Small Businesses
- Can arrange small or flexible orders — sometimes as low as 100–500 units.
- Manage different suppliers and items with one contact.
- Create quality plans to keep defect rates low — around 2–5%.
- Cheaper than hiring your own staff.
- Easy to scale from test orders to larger ones.
When Trading Companies Might Work
- Good for simple products and medium-sized orders.
- Faster quotes because they already have product lists.
- Useful for small extra orders or backup supply.
| Case | Why Use Trading Company |
|---|---|
| Basic textile items | Fixed designs, medium quantity |
| Home products | Simple, easy to buy |
When Buying Direct from Factories Makes Sense
- You sell one or two products in large quantity.
- You know how to handle QC and factory communication.
- You can meet factory’s minimum order and manage changes.
Decision Table for Small Businesses
| Your Case | Best Option | Why |
|---|---|---|
| Many products, under 500 each | Sourcing Agent | Small order flexibility + supplier control |
| 1–2 products, 1000+ each | Factory or Agent | Choose between lower cost and easier control |
| Custom products, small orders | Sourcing Agent | Better support and follow-up |
| Standard products, medium orders | Trading Company | Simple and steady |
| Trying new products | Sourcing Agent | Low risk, small batch possible |
Should You Buy Directly from a Factory or Use a Sourcing Agent?
Factory prices may look cheaper, but hidden costs and poor coordination often make them higher in the end.
Direct sourcing fits large, steady orders. For smaller or mixed orders (under 5,000 units), sourcing agents usually save you more overall.
Many small brands tried buying directly and faced long delays, repeated changes, and miscommunication.
The factory quote is not the full cost — add samples, inspection, rework, travel, and time spent fixing unclear specs.
Agents make the process smoother with clear samples, planned inspections, and local communication — saving time and avoiding errors.
For large, steady orders, factory-direct works well. But for most small and mid-sized teams, agents bring more flexibility and fewer risks.
With a structured QC process, defect rates can drop from 15–20% to 2–5%, saving money on returns and customer issues.
The total cost matters more than just the factory price.
Hidden Costs When Buying Direct
- Miscommunication causes mistakes.
- You pay for inspections yourself.
- Checking suppliers takes time.
- High order limits tie up money.
- You handle all paperwork and compliance.
- Extra costs appear: rework, express shipping, storage.
What a Sourcing Agent Helps You Save
- Time: supplier search 2–3 months → ~2 weeks.
- Defects: 15–20% → 2–5% with QC.
- Total cost: avoid bad orders and save 10–30% on rework.
Real-Life Examples
| Case | Direct Factory | With Sourcing Agent | Better Option |
|---|---|---|---|
| 10,000 pcs, $5 each | $50,000 + $5,000 QC + high risk | $50,000 + $3,500 fee + QC included | Agent |
| 500 pcs, 3 suppliers | High order limit, more work | ~$200 per supplier | Agent |
| Custom product | Miscommunication, delays | Fast reply, local follow-up | Agent |
When to Move from Agent to Factory
- Order volume grows beyond 10,000 pcs per product.
- You have stable products and clear forecasts.
- You can provide full drawings and test plans.
How Much Does a Sourcing Agent Charge Compared to a Trading Company?
Many buyers get confused by prices and try to find the lowest unit cost. But later, they realize the total cost becomes much higher than expected.
Agents usually charge 5–10% depending on how complex your sourcing is. Trading companies add 15–30% on top. Agent fees often include quality checks, supplier verification, and logistics help; trading company markups usually don’t.
We always keep our pricing clear because it helps you plan better. Our fee includes supplier search, factory check, negotiation, quality inspection, and shipping coordination.
A trading company often hides its profit inside the product price. It looks cheaper, but you don’t really know where your money goes.
When you compare “sourcing agent vs trading company vs factory,” ask for detailed costs: factory price, service fee or markup, inspection cost, sample fee, and shipping.
Small brands work better when the service matches their needs — sometimes light support for repeat orders, sometimes full service for new items.
The best deal always includes quality standards, packaging rules, and clear timelines. Otherwise, you may think you save money now but pay more later to fix problems or delays.
Based on our data, a 5–10% service fee often costs less overall than a hidden 15–30% markup.
Sourcing Agent Fee Structure Explained
- Commission: 5–10% of product value, depending on how complex your order is.
- What’s included: supplier check, negotiation, quality plan, inspection, and logistics.
- When you pay: small upfront (if needed) + main fee after order completion.
- Samples: usually refunded after placing the main order.
Trading Company Pricing Model
- Markup: 15–30%, included in product price.
- What you get: product sourcing and basic communication.
- What you don’t get: quality checks or technical support.
- Price transparency: hard to see detailed cost breakdown.
Total Cost Comparison Table
| Cost Element | Sourcing Agent | Trading Company | Direct Factory |
|---|---|---|---|
| Base Product Price | $10.00 | $10.00 | $10.00 |
| Service Fee/Markup | +$0.70 (7%) | +$2.50 (25%) | $0 |
| QC Inspection | Included | $0.50/unit extra | $1.00/unit (you handle it) |
| Checking Suppliers | Included | Not provided | Your time |
| Sample Costs | $100 (refundable) | $200 (non-refundable) | $150 + shipping |
| Payment Safety | Protected | Risky | Risky |
| Communication Help | Included | Limited | Translation needed |
| Total Unit Cost | $10.70 | $13.00 | $11.00–12.00 (with hidden costs) |
| Risk Level | Low | Medium | High |
Real Order Cost Breakdown Example
- 1,000 units @ $10 = $10,000 for products
- Agent 7% = $700; includes QC and sample refund
- Trading 25% = $2,500; QC extra; sample not refunded
- Factory-direct: need to cover inspection and translation costs
- Bottom line: clear pricing always beats hidden markups
Cost vs. Value Analysis
The lowest quote is not always the cheapest. Always check total cost — quality control, factory checks, bad product risk, delay, and time spent.
Ask for all costs in writing before you decide.
How Do You Choose the Best Sourcing Option for Your Products?
Using one approach for everything often leads to delays, poor quality, and missed chances.
Choose based on four things: order size, product complexity, product variety, and your team’s China experience. If you have small orders or many products, agents fit best.
We help teams decide with a simple method.
First, order size — can you meet factory minimums without tying up all your cash?
Second, product complexity — do you need custom design or certifications?
Third, product range — managing many suppliers yourself increases the chance of problems.
Fourth, experience — if your team doesn’t speak Chinese or can’t manage QC, an agent can help.
Working directly with factories is good for big, stable orders when your team can handle all checks.
Trading companies work for standard items when speed matters.
For new or mixed products, agents usually save more time and money because they handle everything from start to shipment.
The 4-Factor Selection System
- Factor 1: Volume & Minimum Orders — see if it fits your cash flow and stock.
- Factor 2: Complexity & Customization — complex products need agents or skilled factories.
- Factor 3: Product Count & Supplier Mix — agents simplify working with multiple suppliers.
- Factor 4: Experience & Resources — match your team’s ability to the task.
Product Type-Specific Recommendations
| Product Type | Complexity | Best Choice | Reason |
|---|---|---|---|
| Electronics | High | Sourcing Agent | Needs testing, certification, and QC |
| Simple Textiles | Low–Medium | Trading Company or Agent | Easy to produce, few risks |
| Custom Jewelry | Medium–High | Sourcing Agent | Design Iterations, Precise Factory Matching |
| Industrial Parts | High | Agent or Factory | Precision required |
| Home Decor | Medium | Sourcing Agent | Many styles, multiple suppliers |
| Fashion Jewelry | High | Sourcing Agent or Trader | Quick Iterations, Wide Variety |
Amazon FBA & Direct-to-Customer Tips
- Follow Amazon FNSKU and packaging rules.
- Keep defect rate below ~2%.
- Label and ship directly to warehouse.
- Manage returns and restock on time to protect your IPI score.
What Are the Biggest Risks with China Sourcing – And How Can You Avoid Them?
Stories about losing deposits, getting bad products, or suppliers disappearing are real—but most can be avoided.
Main risks: fake suppliers, poor quality, payment scams, bad communication, and extra costs. You can avoid most by checking suppliers carefully, using safe payment methods, doing quality checks, and working with people who know the local market.
We see risk as a full process. Fraud risk goes down when you check business licenses, export records, and confirm the factory is real. Quality problems go down when you make clear product specs, keep a sample, and check quality at each stage. Payment risk goes down when you use escrow or pay by steps. Communication problems go down when someone speaks both languages and keeps clear notes. Hidden costs get smaller when you write all details in purchase orders and agreements. From our projects, we see that orders without clear control have more defects and delays; orders with proper follow-up stay on schedule and have fewer returns. For small teams, the best protection is a checklist and a local partner near the factory. You can find templates and plans below and more tips on the Green Sourcing Blog.
Top 7 China Sourcing Risks (By How Often They Happen)
- Risk #1: Supplier Not Checked Well (business license doesn’t match their claim).
- Risk #2: Quality Problems (what you wanted vs. what they made).
- Risk #3: Payment Scams (fake firms, wrong accounts).
- Risk #4: Poor Communication (spec mix-up).
- Risk #5: Hidden Extra Costs.
- Risk #6: Can’t Handle Minimum Order.
- Risk #7: Missing Certificates or Compliance Docs.
Risk Level by How You Source
| Risk Type | Direct Factory | Trading Company | Sourcing Agent |
|---|---|---|---|
| Fake supplier | High | Medium | Low (we check them) |
| Quality issues | High (you handle it) | Medium | Low (we handle it) |
| Money scams | High | Medium | Low (safe payment) |
| Communication issues | High | Low–Medium | Low |
| Hidden costs | Medium–High | Medium | Low (all clear) |
| High MOQ | High | Medium | Low |
| Overall Risk | High | Medium | Low |
How to Prevent These Risks
- Before ordering: check license on China’s company site, check export record, do video or on-site visit.
- During production: do checks at each step; keep your sample safe.
- Before shipping: test packaging, check labels, do AQL inspection; release payment only after confirmation.
How Can You Tell if a Sourcing Agent or Factory Is Real?
Fake papers and fake factories exist—you absolutely need to check. Use these six steps: check the license, look at export records, talk to their other clients, do a live video tour, see how long they’ve been around, and send someone to visit in person before you pay anything.
Our checking system uses multiple layers. First, make sure they’re actually registered on the government website. Second, look at their export records and what products they’ve been shipping through customs data. Third, ask them for contacts of recent clients and actually call those people. Fourth, do a live video call where you record everything and ask to see the production line, warehouse, and boxes going out. Fifth, check how long they’ve been in business (we like to see at least 3 years with steady history). Sixth, when your order is big enough, pay someone independent to go visit the factory in person.
We write down everything we find on a supplier scorecard before we’ll even look at their quotes. This cuts down on scams and gives you better bargaining power because everyone’s working from facts instead of just what they claim.
For the in-person visits, well-known companies like SGS and Bureau Veritas do this kind of work. We also keep our own list of suppliers we’ve already checked; you can see more details about checking if someone’s legit at legitimate verification, and check our Green Sourcing Blog for updates.
The 6 Steps to Check If They’re Real
1) Business License & Registration — look it up on China’s National Enterprise System.
2) Export Records & What They’ve Sold — make sure their import/export business is real.
3) Talk to Their Clients — call and ask questions.
4) Live Video Factory Tour — record the whole thing, see production line, warehouse, quality check area.
5) How Long They’ve Been Around — we prefer 3+ years with no gaps.
6) Actually Go There — pay for a third-party visit when the order is worth it.
Checking an Agent vs Checking a Factory
| What to Check | For Sourcing Agent | For Factory |
|---|---|---|
| Business License | Service company papers | Manufacturing license |
| Export License | Might use supplier’s export | Must have their own |
| Tour | Office + their supplier network | Full factory floor |
| Client Contacts | Ask about service results | Ask about product quality |
| Money Situation | How long operating, payment terms | Equipment, how much they can make |
| Certificates | Service credentials | ISO, product certificates |
Warning Signs
- Won’t do a live video or let you visit.
- License info doesn’t match their bank details.
- Pushing you to pay right now with a special discount.
- Price way below everyone else and specs aren’t clear.
How Green Sourcing Checks Suppliers
We do all six steps on every new supplier, add quality check plans based on AQL standards, and keep a scorecard updated so we can track how they’re doing over time.
What Are the Real, Hidden Costs Nobody Tells You About?
Looking only at the unit price hides the real total cost—teams blow their budgets by 20–40% this way.
Hidden costs include: samples, quality checks, checking if the supplier is real, fixing problems, storage fees, payment and currency exchange fees, plus all the time you spend managing suppliers and dealing with issues.
We figure out the total cost of ownership (TCO) for every single project. The obvious costs are easy to see: factory price, shipping, customs duties, taxes. Then there are semi-hidden costs like agent fees or the markup trading companies add, quality check inspections, factory audits, and samples. The really hidden costs are things like redoing work, sorting through bad products, replacing defects, and paying for storage while you’re trying to get the supplier to fix things. And the invisible costs? That’s your time—searching for suppliers, managing production, and putting out fires.
When you manage orders yourself, all this adds up fast—especially when you’re forced to buy way more than you need because of minimum order requirements. Our case studies show that when you have organized quality checks and properly vetted suppliers, you get way fewer defects and solve problems faster, which means better profit margins and better ratings from customers.
We tell everyone to build a TCO worksheet into how you do quotes and look at it before you actually place the order. You’ll make decisions faster, won’t get surprised, and won’t blow all your cash. You can grab templates from our Green Sourcing Blog.
All the Cost Categories
- Direct/obvious: unit price, shipping, duties/taxes, payment fees.
- Semi-hidden: agent commission or trading company markup, quality inspections, audits, samples.
- Risk/quality: replacing bad products, redoing work, storage, giving refunds.
- Time/missed opportunities: finding suppliers, all the back-and-forth, fixing problems, sales you lose.
Real Example: What an Order Actually Costs
| What You’re Paying For | Managing Factory Yourself | With Trading Company | With Sourcing Agent |
|---|---|---|---|
| Products (1,000 @ $10) | $10,000 | $10,000 | $10,000 |
| Markup/Commission | $0 | $2,500 (25%) | $700 (7%) |
| Samples | $150 | $200 | $100 (you get this back) |
| Quality Check | $800 | $0 (they don’t do it) | Included |
| Checking the Supplier | $500 | $0 (they don’t) | Included |
| Cost of Bad Products | $1,500 (15% defects) | $1,875 | $200 (2% defects) |
| Your Time Talking to Them | $2,000 | $500 | Included |
| Payment Fees (3%) | $300 | $375 | $321 |
| Currency Exchange (2.5%) | $250 | $313 | $268 |
| Storage While Fixing Issues | $200 | $300 | $0 |
| WHAT YOU REALLY PAY | $15,700 | $16,063 | $11,589 |
| Real Cost Per Unit | $15.70 | $16.06 | $11.59 |
| Your Time | 60–80 hours | 20 hours | 5 hours |
How to Figure Out Total Cost
Track all this stuff: unit price, shipping, duties, quality check fees, audits, samples, chance of needing rework, hours spent talking, payment/exchange fees, storage. Then compare agent vs. trader vs. factory to see the break-even point.
How to Cut Costs (The Smart Way)
Spend money on quality checks and checking suppliers properly; this saves you from rework and delays. Combine shipments to save on freight. Make packaging standard across orders. Be careful negotiating payment terms. Use super clear specs so they can’t make "creative changes."
What’s the Best Way to Source for Amazon and Online Stores?
Amazon and direct-to-customer sellers can’t take risks with defects, wrong labels, or missing compliance docs—mistakes will destroy your ratings.
Sourcing agents work best for Amazon/DTC: they already know all the FNSKU and prep rules, keep defect rates under Amazon’s ~2% order defect rate limit, handle all the paperwork, and set up direct shipping to FBA warehouses.
E‑commerce is all about reliability. We set up your packaging, labeling, and box marking so they work for Amazon, Shopify, and whatever new platforms come up. We handle FNSKU labeling, poly bag requirements, suffocation warnings, carton labels, and booking shipments direct to FBA. We also take care of compliance documents—things like CPCs, test reports, certificates—so you don’t get your inventory stuck at the warehouse. For direct-to-customer brands, we customize packaging for that unboxing experience and reduce damage by testing boxes and using the right inserts. Because e‑commerce usually means lots of products with small minimum orders, agents are perfect for this. Trading companies can move standard items fast but they’re not great at customization. Factories can be excellent partners once your volume gets stable. For a complete checklist and templates, check out our Green Sourcing Blog.
Why Amazon & DTC Sellers Need Special Sourcing Help
- Amazon prep rules: see FNSKU & Prep Requirements.
- Low defect tolerance is critical to protect your ratings and ad spending.
- Compliance and safety docs prevent your inventory from getting stuck.
- Lots of products means you need one place handling quality checks and timing.
Why Agents Work Better for E‑commerce
- Handle FNSKU labels, poly bag rules, carton labels.
- Ship direct to FBA and handle restocking.
- Packaging customized for each sales channel.
- Flexible minimum orders so you can test; fast reorders when you need them.
What Each Platform Needs
| What They Require | Amazon FBA | Shopify/DTC | TikTok Shop | How Agent Helps |
|---|---|---|---|---|
| Labels | FNSKU, Amazon labels | Your own branding | Platform rules | We handle all versions |
| Defect Limit | <~2% ODR | <5% | <3% | Quality checks keep it <2% |
| Packaging | Poly bag, warnings | Premium branded | Social media friendly | Custom for each channel |
| Compliance Papers | Required | Depends | Getting stricter | We manage it all |
| Minimum Order Flexibility | High (for testing) | High | Very high | We negotiate low minimums |
| Shipping Speed | Critical (affects IPI) | Important | Super fast | We speed things up |
Private Label & Developing Your Own Products
We help with design changes, samples for product photos, and packaging concepts. If you’re worried about someone stealing your design, we use NDAs and only work with suppliers we’ve vetted to protect your IP.
Real Example: How an Amazon Seller Grows
Start with 1–2 products around 500 units, make sure quality and reviews are good, then grow to 10+ products. Switch factories or combine suppliers as your volume grows, but keep the quality check systems in place.
How Do You Switch Sourcing Partners Without Creating Problems?
Switching in the middle of running your business can create gaps, quality drops, and unhappy customers.
Do it right by running both suppliers at the same time for a while, testing small orders first, setting clear quality standards, giving yourself 3–6 months for the transition, and comparing quality side-by-side before you fully switch over.
We plan transitions like we’re launching a new product. First, look at your current supplier with real data: how reliable are deliveries, what’s the defect rate, how responsive are they. Second, make a short list of other options and get real proof—samples, talk to their clients, do audits. Third, do a test run with 20–30% of your normal order size to check quality and timing. Fourth, run both suppliers at the same time so you don’t run out of stock and you can build trust with the new one while keeping your backup option. Fifth, gradually move more volume over once the new supplier proves they’re reliable. Write everything down: specs, how to test, packaging, labeling, what you’ll accept or reject. Finally, keep a backup supplier qualified and ready in case something goes wrong. This reduces your risk while keeping the benefits.
When You Should Think About Switching
- Quality problems keep happening (more than ~5% defects).
- Communication delays all the time.
- Much better pricing or support somewhere else (more than ~15% savings).
- Minimum orders are holding back your growth.
- Your business has grown beyond what they can handle.
Warning signs you should NOT switch: communication problems you can fix, small price differences (less than 10%), or just because something new looks interesting.
The 8 Steps to Switch
- Phase 1 (Month 1): look at your options, figure out what you need, do research, list all the costs.
- Phase 2 (Months 2–3): get samples, test quality side-by-side, do a trial run.
- Phase 3 (Months 4–5): run both suppliers and compare how they perform.
- Phase 4 (Month 6): gradually shift more volume, keep the backup supplier ready.
Managing Risks When You Switch
| Risk | What Happens | How to Prevent It |
|---|---|---|
| Running out of stock | Customers can’t buy | Overlap orders by 1–2 months |
| Quality isn’t stable | Returns, bad reviews | Quality checks on both sources side-by-side |
| Communication breaks down | Everything gets delayed | Clear rules and weekly check-ins |
| Unexpected costs | Budget problems | Detailed quotes with everything in the purchase order |
| Damaging relationships | You lose your backup | Be professional and document the exit |
Switching Between Different Types
- Factory → Agent: remove the management burden; hand over drawings, BOM, golden samples, quality check plan.
- Trader → Agent: lower cost, more transparency; check out their factory network.
- Agent → Factory: when your volume makes it worth it; build in-house quality checks and hire bilingual staff; keep the agent as backup for busy seasons.
Transition Checklist & Templates
Supplier scorecard, timeline plan, quality check worksheet, communication procedures. Download versions on our blog.
How Green Sourcing Helps with Transitions
We manage running both at once, standardize all your specs, and handle timeline risks while you keep your customers supplied without interruption.
Conclusion
Picking the right sourcing approach determines your profit margins, your risk, and how fast you can grow. Match your partner to your volume, how complex your product is, how many different products you have, and how much experience you’ve got; focus on total cost of ownership, not just the unit price.
If managing suppliers, quality checks, and logistics feels too much, let someone local handle it for you.
Want a clear breakdown of what your products will really cost? We’ll work it out for you.
Ready to source smarter from China? Talk to our team based in Shenzhen.
FAQ
Q1: What’s the difference between a sourcing agent and a buying agent?
They’re usually the same thing. We typically handle checking suppliers, planning quality checks, doing inspections, and coordinating logistics, while some buying agents just focus on completing the purchase.
Q2: Can I negotiate the commission rate with a sourcing agent?
Yes. Normal range is 5–10%. The rate depends on how complex it is, how big your order is, and what you need them to do. Bigger volumes or repeat orders often get you lower rates.
Q3: How long does it take to find a reliable factory with an agent vs. doing it yourself?
Searching yourself can take 2–3 months. With a network that’s already been checked, we usually show you options in 1–3 weeks.
Q4: What kind of minimum orders can a sourcing agent get?
Agents often negotiate down to 100–500 units in the right product categories, while going direct to factories usually means minimums of 1,000–5,000+ units.
Q5: Are sourcing agents only for people just starting out?
No. Startups use us for guidance and support; established brands use us for efficiency, managing multiple suppliers, and launching new products faster.
Q6: What happens if there’s a quality problem?
If you’re going factory-direct or through a trader, you negotiate fixes yourself. With agents, quality standards, inspections, and how to fix problems are all built into how we work.
Q7: Can a sourcing agent help with customization and product design?
Yes. We coordinate technical drawings, materials, and samples; for complex engineering work or branding, we work with your designer.
Q8: How do I protect my product design from getting copied?
Use NDAs, be careful what info you share and with who, work with suppliers that have been checked; consider getting design patents in your main markets. We enforce written agreements and hold suppliers responsible.
