Whether you’re a new business or an established company, it’s essential to have a solid product-sourcing process in place. With one, you’ll likely experience faster sales and even failure.
There are many strategies for managing a successful product sourcing process, but keeping your product mix fresh and relevant is critical. This means you must keep your eyes on the market and always source new products for your store.
Identify Your Needs
If you’re a small business owner, you understand that process of product sourcing is essential to your success. You must source products to sell to your customers in an online storefront or a brick-and-mortar retail business.
The first step in managing a successful product sourcing process is identifying your needs. This includes identifying your customer’s needs as well as your own business needs.
You can identify your needs through keyword research, focus groups, and social listening. Distribute this information to your stakeholders so they can craft and implement features that address those needs.
Next, analyze your current sourcing model and determine how it aligns with your desired sourcing strategy presently and long term. This involves evaluating how well each supplier meets your expectations and how much you’re paying them.
It’s a good idea to ask suppliers if they’d be willing to supply sample products for you to test and evaluate their quality. It can help you to get a clear picture of the quality of their products so you can make informed decisions about your future purchases.
Identify Your Suppliers
Identifying your suppliers is an essential step in the product-sourcing process. There are a few ways to do this, including searching online directories, attending trade shows, or asking other businesses in your industry for recommendations.
Once you have a list of potential suppliers, you can compare them. This can help you determine which ones offer the best prices and quality.
One way to do this is to request samples from potential suppliers and conduct a thorough review. It would help if you also took note of their shipping and handling costs.
The more information you have, the better off you will be. This will ensure you can find the best supplier for your business needs.
Using a supplier with high-quality materials and a well-established manufacturing process will be helpful when it comes to creating your products. In addition, a good supplier will be flexible when supplying small quantities and large volumes of products. This will be important when you are starting your business and need to expand quickly. Choosing a supplier to handle your growth will help you avoid unnecessary stress and costs.
Conduct Market Research
Market research is collecting and analyzing information about your target audience to determine their needs, wants, and preferences. It’s a valuable tool that can help you develop products, create marketing campaigns, and improve your overall business.
Your research will vary depending on your needs and goals, but key strategies can be used to round out your market research efforts. To get started, identify a problem you’d like to understand better and establish your budget for research.
You’ll then need to design the research you want to conduct, decide on the type of research method, and collect the data you need. Finally, you’ll need to analyze the data and present it in a way that communicates your findings.
Primary research is the first step in your research process. It involves reaching out directly to customers or potential customers to ask about their experience with your product, services, or company. This is the best way to learn about buying habits and preferences and identify any challenges your business may face.
Request for Samples
Requesting samples is crucial as it gives you a natural feel for the product and how well it would sell. This is a great way to build relationships with suppliers and get valuable feedback from their teams.
As a buyer, you often need help to visit a supplier’s factory or check on their production process due to distance issues, so requesting samples is vital. This also allows you to ensure that the quality of the sample is as good as the product will be when mass-produced.
Another great thing about sampling is that it allows you to test products and see how they would fit into your business and your customer’s needs. This can help you identify any potential problems with the product and if any adjustments can be made.
Once you’ve shortlisted a few suppliers and know they have a good reputation, you should send them a brief with details of the product you are interested in. This includes quantity, specifications, features, color and sizing, and other extra information.
Negotiating a successful product sourcing process involves a range of different strategies. These include understanding your supplier’s position, knowing how to use the right tactics and establishing a positive relationship with them.
Before negotiating, establish your objectives and list the factors you are prepared to compromise on. This will help you focus on the things that matter most to your business.
It also makes finding the right balance between price and quality, delivery times and terms easier. It’s also important to remember that negotiation is a two-way street, and both parties should feel comfortable and happy with the result.
Collect quotes and offers from suppliers to use your time best. This will allow you to compare them and decide which 5-10 offer the most value for your business. This will also help you avoid wasting time with companies that don’t meet your needs or aren’t willing to negotiate. The more often you deal, the better at it you will become. Check out our checklist, Negotiate Right, to find additional tips on how to get the most from every supplier negotiation.