Sourcing From China is more and more popular for online sellers, however, it’s daunting many new importers. Below are 5 basic steps I have learned from my 20-year experience in sourcing industry:
1. Conducts an initial research
This is the first stage where you decide what your primary activities are, what are the needs of your clients and who your competitors are. These steps help you to determine your business goals and your position in the market. You and your sourcing partner need to design a business plan to determine the performance measurement system and primary work strategy.
2. Evaluate supplier and market
Your sourcing partner, which offers global sourcing service helps you to make a supplier selection benchmark. When you have the list of criteria, you can make further changes in the sourcing strategy and determine the final cost. Given the fact that you already have information regarding clients and prospective markets, you can identify the economic and operational benefits of the project and decide, if you at all want to source from a foreign base.
3. Select suppliers
You can create a request for inquiry and send it to your selected suppliers. After you get back the quotations from suppliers, you can make a final list of suppliers. Then, you can conduct a price negotiation depending on the final supplier list and determine how much you can save.
4. Implement decisions
In this stage, you have to create a performance analysis schedule. Your sourcing partner is going to be a part of the implementation team where you will have to decide resources, shared supply and logistical arrangements. You should keep an account of the performance of every supplier in case of more than one supplier.
5. Monitor supplier performance and take necessary measures.
You must make sure that you, along with the company offering global sourcing service carries out regular performance check and reports it. This will assist you in realizing whether the suppliers are sending products as per your requirements or not. You will also get to know if the suppliers are following your criteria of quality and safety or not.
