What is a Minimum Order Quantity (MOQ)?
Why do factories need a MOQ?
The benefits of MOQ for buyers
Check the MOQ from different platforms
Summary

What is a Minimum Order Quantity (MOQ)?

MOQ, which stands for Minimum Order Quantity, has been recorded in Urban Dictionary since 2008 as the minimum number of products a factory is willing to sell to a buyer at one time. For example, if the MOQ for a product is 100 pieces, you must purchase 100 pieces to get the product.

The MOQ is usually mentioned in different measurements for different products. The MOQ is generally around 100-200 pieces for inexpensive, everyday items. For large electronic devices, the MOQ is generally much lower.

In addition, MOQs are widely used for branding purposes. If a retailer wants to print their logo on a product, the factory may set a MOQ for the product. Since the logo printing process can be budget and labor-intensive, most factories are reluctant to pay such costs for small businesses.

Why Do Factories Need A MOQ?

Minimum order quantity ensures profitability for factories

Most of the time, minimum order quantity is usually used in wholesale business to allow factories to ensure their profitability. Since there are products that are sold at little or no profit, no business should be selling at a loss.

In addition, many products on the market are not sustainably stocked. If you want your factories to supply you with these products, they will need to produce a new batch of inventory. This means they may need to hire more labor and spend more of their budget on new items. In this case, if the factory doesn't sell a large number of products, they won't make any profit.

On the other hand, many retailers don't like minimum order quantities because they prefer to sell products one by one in case they can't sell all the inventory they buy. In addition, high MOQs limit small business owners from selling some products that have great potential.

Therefore, setting a low MOQ may not be ideal for factories to develop a sustainable business. And setting a high MOQ is not conducive to attracting customers. Therefore, it is important for factories to find a balanced MOQ that satisfies both parties.

The Benefits Of MOQ For Buyers

So we know that MOQ is a useful concept for factories, but does that mean that MOQ is not beneficial to buyers at all? However, there are times when MOQ can be beneficial to the buyer or retailer.

First, because MOQ involves purchasing a large number of products, it also brings many advantages to volume sales. For example, products with a high MOQ are often cheaper than products without an MOQ.

In addition, buying large quantities of products will save buyers a lot of money on shipping costs. This is because it is more cost-effective to ship a large number of products together than to ship them one by one.

In addition, products with a high MOQ are also more trustworthy than products with a low MOQ in terms of product quality. If a factory sets a relatively high MOQ for a product, it means that the product requires a large budget to manufacture. Therefore, the factory must sell a certain amount of the product to make it profitable, even though this may drive potential buyers away.

As a result, there are some factories that cut their production budgets to reduce the MOQ for manufacturing. As a result, they can attract more customers with lower MOQ quotes. However, the quality of the product may not be as good as expected. So sometimes a high MOQ is also a guarantee of product quality.

Check The MOQ From Different Platforms

Just as you can compare prices offered by different factories on different platforms, you can also compare minimum order quantities on different websites. Because different factories work with different factories, each factory has its own minimum order quantity standards.

Therefore, you can try to talk to as many factories as possible on different platforms to find the ideal starting amount that you can afford.

If you do want to work with a factory, but have a high product MOQ. You can also negotiate an MOQ with that factory by mentioning the low MOQ you found from another factory. If another factory can produce a product with a low MOQ, then your target factory can likely do so as well.

In addition, if you are not sure which platform to use to find the best factory, you can check DH Gate, Global Sources Marcothepolo, and Aliexpress to connect with factories. The big difference between DH Gate and Alibaba is that DHgate has much smaller minimum order quantities. This makes it easier for small businesses and startups to source products on a budget. However, Marcothepolo does not have a minimum order quantity, and the price is wholesale, so it is a perfect option for you to work with it.