When to contact potential suppliers?

[Dean Bufton]

Currently working on a business plan for an e-commerce business and am wondering when is the best time to contact suppliers to understand product margins and MOQ’s etc?

The catch-22 for me here is if I contact a supplier before I have registered a Ltd and got a test e-commerce website up and running, will the supplier take me seriously enough to begin a business relationship?

Or do I need to invest an element of start-up capital into the website, company registration etc before I make initial contact, so that I appear (to the supplier) to be a serious and viable long term business customer.

Would be interested to hear from the approach taken by others and finding out what has worked or not.

 

[WebshopMechanic]

Hi Dean, there's no problem contacting suppliers now. You are sounding them out for MOQs on products you're likely to order and you also need to know the costs on the product and shipping in order to be sure of your numbers. If you ever look for investment then the investor will want to know that you know your numbers.

Just tell your supplier of your plans and go from there. Maybe give them an idea of launch date to make them realise you're not a tyre-kicker.

Hope that helps.

Matt

 

[Mr D]

To appear to be a serious and long term viable business its a good idea to already have the business set up for several years and be easily found so they can see how viable you are.

As new businesses can't meet those requirements then don't bother. Just be yourself, looking to set up a business and you have a couple of questions about product.
Honesty works and many a good business relationship has started from simply some newbie getting questions answered.

Margins are not really going to be something a supplier gets into. They may give you an idea but its you setting prices, not them.
If you want to buy at £1.50 and sell at £2 most places will let you. Think you are a fool maybe but let you.
You decide to buy at £1.50 and sell for £7.99 then that's up to you - decent margin perhaps.

You could ask 'what do these normally sell for' when discussing a particular item, maybe they'll give you some idea or maybe they won't know. Its really not their business and customers may not be telling them that information.

If you come across a sales rep they can be a good source of information. Just be wary of giving them too much information - they are the gossips of the business world. Useful and they can sometimes point you in a direction you wouldn't have considered - and a good source of info on competition.

If importing then also need to look into the import process - and perhaps using a shipping agent in the UK to deal with matters on your behalf like customs paperwork, shipping etc.
Expensive at times to ship so initially its also worth looking at smaller quantities of more local stuff - there are tons of suppliers in UK and EU who can supply usually with much smaller MOQ and cheaper shipping costs.

 

[DontAsk]

Currently working on a business plan for an e-commerce business and am wondering when is the best time to contact suppliers to understand product margins and MOQ’s etc?

As soon as possible. How else can you create a meaningful business plan without knowing what your costs are going to be?

 

[Larry Fong]

My company's website have a blog post talking about setting up a new e-commerce with sourcing from China. It may give you some ideas.

The article: Three Tips When Starting Online Sales

 

[Dean Bufton]

Many thanks for taking the time to reply with some solid advice, it's very much appreciated

 

[computerbeing]

Not necessary to register a company or build a website but perhaps registering a domain name and a single mailbox under it, would look better than using a free email provider as to ensure more companies would respond.

 

[Furqan721]

contacting supplier is not a problem. You can find ton of suppliers on alibaba or sedex and many other platforms for the potential product you are going to sell.

You will definitely have an idea of the product price including all taxes paid and reach to you. So, find 2 - 4 suppliers and get samples made first and analyze product, cost and everything before setting up everything else.