What is Sourcing agent?

Small Shopify stores often use a sourcing agent when they buy from factories abroad and cannot visit in person or speak the local language. The agent handles supplier vetting, price negotiation, quality checks and sometimes shipping arrangements, which saves time but adds a fee or commission to the cost of goods.

Use a sourcing agent when you are scaling up private label or custom products and need someone on the ground to catch problems before goods ship. Once you have a reliable direct relationship with a supplier, some store owners drop the agent to save on fees, though this depends on how complex the sourcing is.

Example

A candle store owner wants to source custom tins from a factory in another country. She hires a sourcing agent who charges a 5% commission. The factory quote is $2 per tin for 2,000 units, so $4,000 total. The agent's fee adds $200, bringing the total landed cost before shipping to $4,200.

Common mistakes

• Treating the agent's fee as free, when it is usually built into the unit price or billed separately.
• Not clarifying who the agent represents, since some agents are paid by the factory, which can create a conflict of interest.
• Skipping a written agreement on quality checks and responsibilities, which leads to disputes if a shipment arrives wrong.

Sourcing agent and SteadyShelf

SteadyShelf does not manage sourcing agents or production, but once you have a supplier and a lead time in place, it tracks reorder timing and drafts purchase orders for that supplier.

SteadyShelf is launching on the Shopify App Store. Join early access to get the install link first.

Related terms

Supplier · Private label · Contract manufacturer · Co-packer · Landed cost

Full inventory glossary

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