Understanding Product Sourcing Needs--Key Questions

Written by Strand Davis Sunday, 22 May 2011 07:06

Is product sourcing for your home micro business a constant bother as it is for many others? There is no doubt that product sourcing is vital for any home business, and both you and the suppliers with whom you deal must give it proper respect. Part of the problem is not understanding the scope of the field. Many people think of product sourcing only in terms of wholesale suppliers and drop shipping. Moreover, many think of selling only on eBay without realizing that as big as eBay is, it is only one option out of many that exist within the ecommerce market.

Is product sourcing for your home micro business a constant bother as it is for many others? There is no doubt that product sourcing is vital for any home business, and both you and the suppliers with whom you deal must give it proper respect. Part of the problem is not understanding the scope of the field. Many people think of product sourcing only in terms of wholesale suppliers and drop shipping. Moreover, many think of selling only on eBay without realizing that as big as eBay is, it is only one option out of many that exist within the ecommerce market.

Your product sourcing needs will be determined by your business. That may be obvious, but many people miss that point. The product you sell follows from your business plan, and your product, to some degree, will determine the logistics of supply. For example, if you sell mass market auto parts, then you will probably rely on a conventional wholesale supplier who may or may not provide drop shipping for you. In that sense, your sourcing problem is handled, and if the supplier drop ships, your means of delivery is handled as well. However, if you are selling items produced by local artisans, then the logistics of supply and deliver will be a bit different. There really isn't a one-size-fits-all solution to product sourcing.

When we are dealing with online, retail ecommerce in the context of small home business, then product sourcing becomes even more important. That is, there is much less tolerance for error should there be supplier mistakes in inventory and delivery. The fact is product sourcing involves more than just the relative cheapness of the product. Price is important, but if you only think in terms of price, you may suffer later on. Long term success will depend also on quality of goods, having inventory on hand to sell, and delivering your products in a timely manner.

When you sell a product, you are making a contract with the buyer that your product will meet expectations of quality, and because this is ecommerce, you are also promising quick delivery. As a business person, you have an obligation to provide good customer service. However, your good intentions can be ambushed by an unreliable supplier. If you products you sell are of unpredictable quality, and if you cannot rely on deliver of inventory, then you will eventually lose the trust of your potential buyers.

There are two problems that most beginners come up against. First, how to find products, or how to figure out what products to sell. Second, how to find suppliers. The reality is that these are not hard problems to solve, though they may seem so at first. The fact is, and you may not believe this, but these issues begin to take care of themselves when you do business planning. The first step to take is often to figure out and draft a business plan. For example, who are your customers? What niche are you trying to satisfy? What kind of business model do you plan to employ? When you begin to tackle these sorts of questions, other questions regarding sourcing and products will begin to make sense.

Following your basic business planning, you are now ready to think about getting products. Many people begin their search on the Internet, and I have noticed that there is more legitimate information and a greater number of resources then several years ago. Even though you can Google your product and find help leads, legitimate wholesalers do not generally rely on the Internet for business and so are not always easily found. Personally, I think a far more reliable strategy is simply to call the manufacturer and ask who their authorized distributors are. This is simple and direct, and if you are honest and professional in your communication, you should get some good results.

Another solution available online are wholesale drop ship memberships. Salehoo, World Wide Brands, and Aid and Trade are three well-known examples, though you will find many others if you look. Such memberships claim to offer contact information to thousands of suppliers across many different product categories and often provide a means to network with other people engaged in ecommerce. Wholesale memberships can be helpful if they fit your business model. It is important to do your due diligence and remember that they are just one resource at your disposal. Keep in mind that successful product sourcing begins with your business plan.