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What Is Product Sourcing? Overview, Strategies,

To find products for your e-commerce store, the best place to start is visiting online wholesale markets like Alibaba.

When you’re looking for a product to sell, it can be not easy to find the right one at an affordable price. Researching suppliers and maintaining high-quality standards is very challenging.

It is not easy to know which sourcing methods are the best fit for your brand, but all e-commerce businesses have a lot of similarities. They mostly use product sourcing from wholesalers and retailers.

The most important part of your business is finding suitable suppliers and products to get ahead.


Product Sourcing

product sourcing

In a nutshell, product sourcing is finding products to sell. It means identifying quality suppliers and negotiating reasonable prices for your inventory.

Product sourcing aims to find the best goods for your store at the lowest prices with a hefty markup. This means researching suppliers and negotiating prices. The easiest way to do this is by using price calculations.

It will make all the difference if you know how to get your hands on quality products at a competitive price. The more knowledge and skills you have in this area, the better.

If you find the same product as your competitor for a lower price, undercut their sales and still make a profit. If you find your best-selling products for lower prices than yours, maximize profits by keeping online pricing constant.

The most popular ways to source products are from wholesalers manufacturers, making your product, or partnering with a dropshipping provider. You can also make handmade items.


Top Strategies for Product Sourcing

It’s essential to test every variable, even if you’re starting. One of the most rewarding aspects of product sourcing is how much curiosity and diligence pay off.

product sourcing

1 – Wholesaler

If you’re not manufacturing or assembling your products, this is the best option. It’s also a great choice because it allows for scaling.

When it comes to expanding your product line, you can always add more products as long as your brand grows and there is demand for those items.

Pros and Cons: Working with a wholesaler means you can sell products without having to invest the time it takes to make them yourself. However, your upfront costs will be higher if you go this route because many wholesalers require that purchases be made in bulk.

When you sell the same products as other retailers, competing with them becomes much more challenging.

To find the right products, you may have to do online research. Click To Tweet

Consider a supplier like Alibaba that offers access to an extensive catalog of products.

Online directories are an excellent place to start looking for potential partners, but you will have to spend some time sorting through the options. Finding the right people can be worth it in terms of making your business run more smoothly.

2 – Manufacturer

For some e-commerce retailers, it is easier to work with manufacturers because they do not have to worry about intermediaries such as trading companies. It’s also a good idea for those who want private or white label products.

Challenging task, but it’s essential to maintain these relationships with manufacturers because they’re vital for our company.

There are many benefits to going with a manufacturer that has MOQs. One advantage is that you can get products cheaper than buying wholesale, but it might still be necessary to buy in bulk depending on the product.

This makes it hard for smaller businesses that have less money to work with.

Finding wholesale suppliers may be a hassle. The best way to find them is by searching online and attending trade shows near you.

You’ll get to meet with some manufacturers and wholesalers face-to-face at these events.

3 – Handmade Products

The internet has many people looking for unique, handmade products. Buying hand-crafted items online is easy! Many artisans can make a living selling their creations on the web.

Going the DIY route can be tricky. You have to do all of your research on what works best for different species and climates, for starters.

Pros and Cons: One of the biggest perks is creating your inventory because no one else sells exactly what you do. You also have complete control over everything from how much product people can buy at a time, up until every detail on the packaging.

When you’re selling DIY products, time is your most valuable resource. You can’t make money if you don’t have the hours to do it.

You have to think about how you will keep up with your business if the demand for what you sell skyrockets. It would help to consider whether it is worth taking on more employees when they are so expensive.

What are you going to do if your competition does better than you?

Finding suitable materials is an essential step in any project. Click To Tweet

Whether you are buying or making, this process can be time-consuming and may involve visiting craft stores, flea markets, estate sales, retail stores…etc.

Be sure to identify all the materials you need, where they can be found, and how much they will cost. That way, you’ll know what your pricing should look like.

4 – Dropshipping

Dropshipping is a great way to sell products because you don’t have to handle the shipping. When an order comes in, your supplier sends it out for you.

product sourcing

This is an excellent way to start an online store because you never have to touch the products. You can find what’s in demand and put it on your site, so there are endless possibilities.

One of the pros to using this sourcing method is that you won’t have to worry about having inventory on hand, packing up products, or even shipping them. The downside with this source is that there will be more competition because it will not just be your company selling these items.

You also have to sell more of the product because you pay less for it.

When you’re using a dropshipping supplier, sourcing products is simple – there are plenty of options to choose from. You should still do some research and evaluate suppliers before making your decision.

It’s essential to make sure that the products you sell are high quality and have good reviews. It is also worth considering how reputable the company is and its customer feedback.

5 – Marketplaces

When you’re just starting, it’s tempting to think that looking for products on existing marketplaces is the best way to find what your customers want. But often, there are plenty of sellers with similar items at lower prices.

By checking out the latest and greatest items on these sites, you can gain valuable insight into popular products in your industry. You’ll also be able to see which ones have room for improvement in marketing.

Researching the market before you start selling is key to success. The more knowledge about what they want, the better your strategy will be.

6 – Trades

Trade shows, conferences, and exhibitions are a great way to show off new products that retailers may not have known about. These events offer the opportunity for sellers to meet with buyers who could potentially be interested in their product or service.

Trade shows are essential for any business, but they depend on what you do and where you are. If your industry is highly specialized or not geographically concentrated, trade shows can effectively stay in touch with the people who matter.

However, if you’re looking to break into a mainstream market like pet food or lawnmowers, you have more freedom with your marketing.

7 – Product Sourcing 

Product sourcing companies are the professionals of procuring products for you. They do all the hard work, but it comes at a cost to your company because they charge high prices and take up profits that could be used elsewhere in your business.

If you hire a product sourcing company, they will find the right supplier for your products.

The trouble with product sourcing companies is that you never know who to trust. Some are scams, so make sure the company has a good reputation before charging it.

Before you buy anything, always research the company. If it’s new, or if they are being too pushy with their sales pitch, then you might want to reconsider buying from them.

8 – Sourcing Platforms

With so many companies investing in e-commerce, it makes sense that entire online marketplaces are dedicated to sourcing retail products. Sourcing platforms like Alibaba help retailers and suppliers find each other, which is why you see a lot of messages asking for minimum orders.

It’s not just the fact that sourcing platforms make it easy to find competitive pricing and suitable suppliers, but because they’re so convenient for buyers, everyone can access them. So if you want a product at your price point, someone else will too.

9 – Directories

Be prepared for the work if you want to use a directory instead of a sourcing platform. Directories only list suppliers and require more time on your part.

If you take the time to find a potential client’s decision-maker, they will most likely give you an exclusive deal because there is no competition.

You have to be careful with these scammers. Some directories let you look at the list for free, and it’s suitable for everyone involved- including those scamming people because they get a spike in traffic from all of us who are looking around.

Some directories might sound great, but you have to make sure they offer what they say before deciding whether or not it’s worth the expense.

10 – Liquidation

One way to find products is by sourcing from manufacturers or wholesalers with excess stock. Sellers with this strategy want to get rid of the inventory quickly, so they are more willing to sell at a discount.

Liquidation stock is a great place to find deals, but it’s not always easy. Click To Tweet

You may have to search through many different liquidations until you can get the product that you want.

You can reach out to your suppliers, but that gets tedious if you contact more than one.

If you’re looking for the best deals, then it’s worth checking out sites like Bulq and Liquidation.com.


The ideas in this article are just a starting point for you. It’s important to know what type of products and suppliers your business will need before diving into anything else.

A good strategy should satisfy your customers and help you grow and make a profit.

Check out our guide on sourcing products for each business model for more information. It’s important to note that many methods can be used across multiple models and that most businesses will benefit from various techniques.

It’s important to remember that no plan is perfect, and you might need a combination of these individual plans to get the most out of your sales team.