Sourcing companies for Amazon FBA sellers offer tons of benefits for small businesses looking for alternate ways to market and sell their offerings. Selling products on Amazon requires a lot of document, supplier, and logistical management. These processes take up valuable time sellers could use to expand their products and services and thereby grow their business.
By working with a sourcing company, sellers that are part of the Amazon FBA program can streamline essential business processes without wasting too much time and resources on management. With that, the chain of reselling products on Amazon, also known as retail arbitrage, can bring about high revenues.
For those considering selling products on Amazon, this article will walk you through the basics of finding and working with a sourcing company. After reading this, you should know the value a sourcing company provides as well as how to properly find one that best suits your business.
Let’s start by understanding what a sourcing company is for Amazon FBA.
What Is A Sourcing Company For Amazon FBA?
A sourcing company is a business that specializes in finding and vetting suppliers of retail arbitrage products. They have the connections and experience to find suppliers that offer the best prices and products. In addition, they will also help you negotiate terms and conditions, as well as handle all of the paperwork and shipping logistics.
Sourcing companies are an invaluable resource for Amazon FBA sellers. They can help you find the best products to sell at the best prices. In addition, they will handle all of the paperwork and shipping logistics so that you can focus on growing your business.
Here are ten reasons Amazon FBA sellers should have a sourcing company.
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10 Reasons Amazon FBA Sellers Need A Sourcing Company
Sourcing companies for Amazon FBA sellers simplify the sourcing procurement process for a streamlined retail arbitrage system. As an online seller on Amazon, this is critical since your time is best spent marketing and growing your business – not searching for products or dealing with supplier issues. Working with the right sourcing company can provide several advantages and benefits, including:
1. Valuable Connections And Experience
Working with a sourcing company offers Amazon FBA sellers access to connections and experience working with suitable suppliers. Since part of being an Amazon FBA seller is sourcing quality suppliers for products you want to resell at a reasonable price point, choosing the right people to work with is crucial for success.
When working with a sourcing company, you can identify quality suppliers looking to sell their goods on various online marketplaces such as Amazon. You can work with suppliers via a sourcing company to establish a direct relationship and negotiate the best prices available on the market.
In addition, working with a well-connected sourcing company eliminates language and geographical barriers that often cause misunderstandings in a supply chain. Furthermore, these companies often have the ability to source proprietary deals that might not be accessible to the general market. Many sourcing companies will have expert teams accustomed to working with various suppliers on a global scale, such as North America, South Africa, and Hong Kong, to name a few. With that, you also gain access to overseas suppliers with better offerings than your geographical area.
2. Vetted Reliable Suppliers
In line with the connections and experience a sourcing company brings, they can properly vet suppliers to ensure they adhere to best practices and product quality standards. A reputable sourcing company can also provide valuable insight into how individual suppliers manage their orders and clients.
Part of vetting suppliers includes reviewing their audits and compliance standards in raw materials used, production practices, and shipping conditions. These suppliers can also give you insights into their operation and how they source their products. With that, you will get a chance to work with a supplier that can deliver high-quality products to you at a reasonable price.
Having a sourcing company screen potential suppliers before you work with them lets you know they are reliable and trustworthy. It ensures customers remain satisfied with the products they purchase k.
3. Get The Most Out Of Negotiations
As an Amazon FBA seller, it’s essential to always be on the lookout for ways to increase profits. One of the best ways to do this is by ensuring you get the most competitive prices from suppliers. Working with a sourcing agent that has the experience and knowledge necessary to negotiate with suppliers on your behalf will get the best possible price for the products you want to sell.
The right sourcing partners can also help protect you from supplier price increases by mitigating the amount increased for your orders. They will also be able to help you negotiate other essential elements, such as payment terms and minimum order quantities.
In addition, a sourcing company can often get suppliers to agree to better terms than what you could get on your own since they are working with multiple clients. This means that the supplier is more likely to be flexible in their negotiation if it means they can secure a large, long-term contract.
4. Manage Your Paperwork And Shipping Logistics
The process of sourcing and selling products as an Amazon FBA involves a lot of paperwork and logistics. These can be time-consuming and overwhelming, especially if you are just starting out. A sourcing company can take care of all the paperwork and shipping logistics for you to focus on cost-effectively growing your business. Customs clearance, paperwork, finding reliable procurement services, and organizing shipping schedules all fall under this category.
Sourcing services can also help you track your inventory and keep tabs on your supplier’s stock levels. This is important to avoid selling out-of-stock items and missing out on potential sales.
Having a sourcing company handle the grunt work clears up more time for you to focus on expanding your offerings and analyzing exactly what your business needs to stay competitive as an Amazon FBA seller. A sourcing company will also work with your suppliers to ensure that your products are shipped on time and in good condition. If you’re sourcing products from overseas suppliers, this is particularly important.
Moreover, Amazon FBA sellers looking into international sourcing will experience higher documentation and paperwork requirements. Product sourcing efforts from countries like China and Vietnam can benefit from working with FBA Sourcing Services In China or other country-specific agents.
To streamline paperwork and logistics management, you can set up your communication platform directly with the sourcing company for all your suppliers instead of individual supplier contacts. Such a system makes tracking and managing your orders and requests easier since they are all with one contact person. With that, you’ll have some spare time to focus on other business aspects or take a breather and play a scrabble word game.
5. Keep Updated On Trending Products
The eCommerce landscape is constantly changing, and new trends are always emerging. As an Amazon FBA seller, it’s crucial to stay on top of these trends to offer your customers the latest and greatest products. A global sourcing company and its agents often keep track of trends in eCommerce by watching social media and analyzing buyer patterns on platforms like Amazon.
While you can use these same methods to keep ahead of trends and work with a network of boutique affiliate influencers to market your products, you won’t be able to make the sale if you don’t have them in stock. Popular trends often run out of stock during the first wave of purchases. Those who could buy from suppliers then have the upper hand in the market, leaving the rest to wait until stocks return.
With that, sourcing companies can ensure you get popular stocks before they run out again , a first-mover market advantage. These trends are significant for seasonal products that suppliers may discontinue after a certain amount is sold.
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6. Handle Product Returns
Product returns are a reality of selling online, but they don’t have to be a headache. A sourcing company can help you manage product returns to focus on marketing and growing your business. They can guide you on handling different returns, processing refunds, and even help you find new suppliers for products that are frequently returned.
Additionally, working with a sourcing agent helps you keep track of product return rates so that you can identify issues early on and take steps to prevent them from happening in the future. This information ensures that you offer high-quality products and maintain a good reputation with your customers.
7. Ensure Quality And Authenticity
When selling products on Amazon, it’s vital to ensure that they are high-quality and authentic. Even common items like walking canes for the elderly need to have Amazon standard quality before they can be sold on the platform. Purchasing products from overseas suppliers can be challenging. Using a sourcing company can help with this by screening suppliers and providing they are trustworthy and reputable. They can also help you negotiate contracts, including quality control measures.
As part of their sourcing services, sourcing companies can also guide clients on how to spot counterfeit products and how to prevent them. Having this information is important for protecting your business and reputation. Remember, your Amazon products must also meet certain quality and safety standards. If not, your Amazon FBA contract might be breached, and you will no longer be able to sell on the Amazon marketplace.
Health, safety, and quality inspection are all essential elements to adhere to when selling online, especially if your products are health supplements like pre-workout whey protein. These products not only need to meet strict requirements but should also have Food and Drug Administration (FDA) approval. Otherwise, Amazon sellers MUST include a disclaimer in their descriptions to avoid liabilities if a buyer experiences issues.
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8. Increased Customer Support
As a client of a sourcing company, you’ll get access to increased customer support. When you encounter issues with your suppliers or products, they can handle communication and liaison directly. The customer support team can help you troubleshoot problems, resolve disputes, and find new suppliers if necessary.
Sourcing agents will also handle other aspects of supplier relationship management on your behalf by being the direct contact. They will have the proper tools, channels, and country coverage to keep a direct line with the suppliers you choose to work with through them.
9. Remain Viable In A Highly Competitive Marketplace
eCommerce marketplaces like Amazon are becoming more and more competitive. To succeed, you must have a sourcing strategy that allows you to source high-quality products at an affordable price.
Creating a sourcing strategy that meets your specific business needs is easy with the help of a sourcing company. They can also help you implement this strategy to remain viable in a highly competitive marketplace. A sourcing company can also help you adapt your sourcing strategy as the marketplace changes. Plans include changes in consumer behavior, new competitors, and shifts in the overall economy, which you can monitor through proper stock market news channels.
On the topic, remaining viable in the eCommerce marketplace also means giving your customers a reason to choose you over competitors. One way to do this is to give them
discounts and coupons for referring their friends and family to your products. With that, they can avail of discounts when purchasing from you, and you get a list of leads and new potential customers to work with.
10. Scale Your Business
As your business grows, you will need to scale your operations to meet the demands of your customers. You can find new suppliers, negotiate contracts, and set up logistics with the help of a sourcing company. Sourcing companies can assist you with troubleshooting. In addition, customer satisfaction is affected by issues with product quality, delivery times, and delivery dates.
Best Practices For Choosing The Right Sourcing Company For Your Business
Not all sourcing companies are created equal. When choosing a sourcing company for your business, you must consider your specific needs and requirements. Here are a few practices to help you choose the right sourcing company.
A. Define Your Sourcing Goals
Before you start looking for a sourcing company, you should define your sourcing goals. If you want to scale your business quickly, you will need to consider how you will handle orders soon. Before you look for a sourcing company, you should establish what kind of business you want to run. Do you want to be a wholesale supplier? Or do you want to sell directly to end users?
Applying a SMART method to this process can clearly outline what you want.
Outlining the basics of your Amazon FBA business is vital because it will help you to set clear expectations with the sourcing company you choose. For example, suppose you want to sell your products to a wholesaler or retailer. In that case, it is crucial to clarify whether or not you are willing to handle order fulfillment or prefer to outsource this task.
It’s essential to be clear about your goals because your sourcing company will help you achieve them and can even give you good advice on how to go about certain matters.
B. Consider Your Budget
Starting a business as an Amazon FBA seller comes with the required investment capital, just like any other business venture. Considering your initial operational budget narrows down supplier options that the sourcing company you work with will target. Providing budget guidelines to sourcing company agents also makes sure that the suppliers they recommend to you have sustainable and reliable pricing.
Sustainable pricing means that the supplier’s product prices do not fluctuate consistently. If it does, you will constantly need to adjust your pricing, which can prevent some customers from purchasing.
C. Evaluate Their Expertise And Experience
Amazon’s FBA program is highly competitive and saturated with products for consumers to choose from. A sourcing company’s experience and knowledge are crucial factors that will help you to make the right decision on the best products to the front and which suppliers provide those products.
Ideally, the sourcing company you choose will have experience and expertise working with Amazon FBA sellers. e Amazon has its own guidelines, requirements, and standards that sellers must meet before selling a product on its platform. A reliable sourcing company will have the proper knowledge to ensure that you can complete your order fulfillment tasks.
Sourcing company agents have extensive knowledge in shipping, warehousing, inventory management, and sales techniques. A reliable sourcing company will also have knowledgeable agents who can provide you with ongoing assistance and guidance.
D. Research References
Researching references for your chosen sourcing solutions is important. You should ensure that the sourcing company you select has a good reputation and a good amount of experience. It would help if you researched its previous clients and their references to supply chain management.
Visiting their websites to check out any testimonials and comments posted online is a great way to start your reference check. These testimonials and comments give you an idea about their capabilities and consistency in ensuring their clients receive the best solutions for their businesses. If you are not comfortable with what you read, you should move on to another.
E. Get A Written Agreement
Once you have decided on a sourcing company or buying agent to work with, you should ensure that you have a contract that states clearly what is expected of you. Otherwise, you may have to deal with problems later on if you don’t have an agreement. The formal agreement will protect you from legal issues in the future.
Ensure that the sourcing contract you sign with the company is not too restrictive. If this happens, you may be placed in a difficult position. The terms and conditions you agreed to can prevent you from taking advantage of the opportunities the sourcing company has offered you. In turn, you may experience a harder time managing sales and growth potentials for your Amazon FBA business. Before signing the contract, you must be familiar with these terms and what you will be expected to do.
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Conclusion
Amazon FBA sellers who work with a reliable sourcing company can achieve high-profit margins and business scalability. Sourcing companies make the retail arbitrage process more accessible by providing valuable support in outsourcing supplier vetting, management, and communication.
Many successful retail arbitrage sellers have started using a sourcing company to manage their supply chain and sourcing needs. Amazon FBA is an amazing opportunity for aspiring entrepreneurs looking to start a business with high potential for growth and profit. If you plan to launch your own eCommerce business, having your sourcing needs met with quality assurance and low cost can be done by working with the right sourcing company.
Visit us at LeelineSourcing for a complete list of sourcing services for your Amazon FBA business.
