Negotiating with a factory in a professional manner is the key to be a successful Amazon seller. Your whole business idea revolves around your dealing with the factory which would be responsible for providing you the products.
If you’re new in the business, you might be feeling a bit lost or confused in the beginning. You need to know where to start from and how to go about it on every step. No one can afford to make silly mistakes in the beginning of a business, as losing your investment money can be quite discouraging to move ahead.
1. Select the right Mode of Communication
There are numerous ways of communication and negotiating with the manufacturer. All of these have their own advantages and disadvantages. Now it’s upto you to select the one that suites you the best.
Different options for the modes of communication and negotiation with a factory include the following:
Visiting a Manufacturer Face to face: Visiting a manufacturer for a face to face negotiation can be a nice idea but it requires some preparation on your end beforehand. If you’re not clear about your expectations or business requirements you’ll be ending up making deals which won’t benefit you much. Similarly, if you’ve not done a prior search regarding the prospect vendor, you might not feel very confident or clear while negotiating face to face. So always do some homework and search a bit to make yourself clear who you’re negotiating with and what terms you should agree upon.
Negotiating through Electronic Messaging: Email, Skype, telephone, Wechat and WhatsApp are all the convenient negotiation options which provide great flexibility of time and place for the negotiation. You can stay in touch and negotiate with the manufacturer to check the progress anytime.
But make sure to sign the agreement for the business deal with all the terms clearly mentioned in it, instead of relying completely on email or Skype communication. Documenting the complete agreement in legal way is necessary before proceeding with the order or payments.
Negotiating through Alibaba: Searching for manufacturers and suppliers through Alibaba is simply the easiest first step for most of the new sellers. You can definitely find what you’re looking for on this site, as it has many great options with a variety of factories, whole sellers and agencies.
You must keep yourself very clear about your business requirements before starting your search and negotiation with any of them.
Negotiating through a Trade Show: A trade show is a place where you get to know about different manufacturers and their special products. This is the place where you can get plenty of information regarding a variety of products and their manufacturers.
You can also interact and communicate with these manufacturers and can arrange a future meeting for discussing your business demands in detail. Mostly the quality of products displayed in a trade show is very high, and so is their price. So while negotiating always ask for the best quality products at a reasonable price.
These manufacturers keep a high price of their products for the trade shows to show the quality of their goods, but once you want to place a big order they’re willing to show some flexibility as well.
2. Choose the Right Supplier on Alibaba
Alibaba is definitely the best and most popular platform with plenty of factories and product suppliers to choose from. The only tricky part is to negotiate with the suppliers very professionally and deciding all the term for proceeding with your business deal with them.
3. First Check the Sample before Placing a Big Order
You should never place a big order before checking the sample thoroughly. Always give your feedback after checking the sample products and negotiate with the manufacturer regarding your demands. If any changes are required in the design, color or features of the product, please be very clear about what you want and communicate it clearly too.
Good manufacturers always value their client’s feedback and modify or improve their product accordingly for complete customer’s satisfaction. This initial quality check is necessary for becoming a successful seller.
4. Deciding the Lead Time
Chinese factories are always an ideal option for supplying goods to be sold on Amazon or an ecommerce site, but they’re also more prone to delaying supplies for many reasons. These factories usually receive a lot of orders which are more than what they’re capable of producing.
So please do keep in mind all of these lead time negotiation factors in mind while dealing with a factory and always confirm the delivery time, as any such delays must not affect your business reputation at all.
5. Think of Manufacturer’s Capabilities
Once you make up your mind for a specific product to sell through Amazon you need to choose the right supplier. Always place your order keeping in mind the production capability of the factory or manufacturer and do negotiate with the manufacturer, keeping in mind your business requirements and their production capability as well.
A wrong estimate or an over expectation of products supply can be harmful for both parties and can affect your business relationship in the long run.
6.Negotiate Well to Get the Best Prices of the Products
Pricing is one of the most important aspects to negotiate with a manufacturer. Pricing you get for your goods depends basically on the cost of raw material used for making that product. Then there are different qualities of the same material to choose form.
If you simply ask for a low price without making the manufacturer clear about your expectations for the quality of goods, they might simply use a lower quality material to prepare the goods according to your budget. Never comprise on the quality of goods while trying to get the best pricing deal.
7.Decide the Shipping Procedure and Estimate the Cost
Do some search on the available shipping options for making a well-informed decision. Ask the supplier whether they’re going to ship the products or you need to arrange it. Then compare the cost of both options and make your best decision for that.
8.Use a Reliable and Well-Reputed Third party Inspection Agency
China Sourcing Chain for example is one of the leading sourcing agents from China. They’re not only providing excellent sourcing services, but also ensure product quality by conducting quality inspections. Once you assign the job to them, they’re there to take care of it very professionally keeping all the aspects in mind. There would be no need for you to negotiate with the factory anymore, as they can get you the best quality products at best possible pricing very easily.
You can also rely on them for tracking production of goods and negotiating with the factory. They can even reduce the whole cost of your business plan upto 10% to 20% or more. Moreover they offer two free service trial orders to check the quality of their services. What else can you ask for to become a successful Amazon seller so easily, without any hassles at all.
You need to be very clear about your business requirements and must not compromise on the quality of products for a lower price. Negotiating with a manufacturer is also tricky at times as it involves many details to be decided or agreed upon. Finding a good agency for supplying you with the products you need, is the best solution to all these issues. If you calculate and compare closely, you’ll come to know that it’s not expensive at all, but saves your time and money in many ways.
