What is a sourcing agent or sourcing company?

A sourcing company helps the clients in fields of market research, selection of vendor or supplier, quality assurance, quality control, price negotiation, sourcing raw materials, statistics and transportation, customs clearance, pre-shipment inspection.

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Sourcing March 31st, 20212 views

A sourcing company helps the clients in fields of market research, selection of vendor or supplier, quality assurance, quality control, price negotiation, sourcing raw materials, statistics and transportation, customs clearance, pre-shipment inspection.

  1. A sourcing agent ensures that the concerned company ( employer) has access to the required products and supplies at an affordable cost so that the employer can save spent on producing the goods or prices of the goods to be sold.
  2. The various types of sourcing agents and sourcing companies found:
    • The sourcing agent could be working on behalf of an individual firm or a collection of firms which require outsourcing.
    • The agent might be located in another country as a representative ( found in low budget or underdeveloped countries).
  3. Alternatively, a sourcing agent is called as purchasing agent or buying agent.
    • The main job of a purchasing agent is to represent and carry out transactions on behalf of the employer, in a specific territory like a country or a group of countries.
    • The basic working of a buying agent is the same as a purchasing agent.

Working and responsibilities

  1. Marketing and research:A sourcing company primarily finds out the demands and the requirements of a company, locates vendors and meets up with them to assess whether the vendors are currently working , ready to take up orders. They also help unknown buyers to ensure the quality of vendors and discard the bad vendors.
  2. Evaluation and assessment :The sourcing agents are responsible for factory check ups to ensure that the factories meet the expectations of the vendors. They are also known to evaluate the factory to find out about the policies they follow for environmental protection, overworked labourers.
  3. Negotiation of prices :It is the sourcing agent who meets up with a possible supplier in order to negotiate the prices of goods in a way which offers the employer a much better deal. They can negotiate better and cheaper deals.
  4. Link of communication : Since the sourcing agent is the connection between a supplier and a buyer, he is responsible for maintaining a better professional relationship and avoiding disputes. The sourcing agency sits in all the disputes and negotiations.
  5. Transportation and statistics :the agent has the ability to reduce expenses and clear the transportation of commodities without being held for long by the clearance authority. They can help in faster shipment clearance and with less risks.
  6. Tasks and taxes :A sourcing agent can help clear issues like import and export duties, tariff barriers.
  7. Supplier: the agent has the ability to reduce expenses and clear the transportation of commodities without being held for long by the clearance authority. They can help in faster shipment clearance and with less risks.
  8. A sourcing company has the capability to add various skills and services which help the company to improve.
  9. On time deliveries
  10. Quality check

Who uses a buying or sourcing agent?

Businessmen, individual FBA sellers and drop shippers, companies who cannot set up International Procurement office or Sourcing office in the home country, choose a sourcing agent to act as the joining link.

Why hire a sourcing agent ?

They deeply understand the rules and regulations of a regular wholesale market,have connections with good quality manufacturers, know the demands and requirements of products of a cultural market, can procure low cost goods.

The PROS and CONS of working with a sourcing agent :

The top pros of working with a sourcing agent:

  • Local and growing business work with sourcing companies to free up time and resources that they can focus on their business.
  • A sourcing agent has an in depth knowledge of purchasing products which can help you access the highest quality products.
  • The sourcing agent can help you in delivering a better consumer experience by conducting a thorough quality check.
  • Acts as your representative as and when required. He also reduces your travel trips in search of a buyer or a vendor.

The top pros of working with a sourcing agent:

  • Local and growing business work with sourcing companies to free up time and resources that they can focus on their business.
  • A sourcing agent has an in depth knowledge of purchasing products which can help you access the highest quality products.
  • The sourcing agent can help you in delivering a better consumer experience by conducting a thorough quality check.
  • Acts as your representative as and when required. He also reduces your travel trips in search of a buyer or a vendor.

The top cons of working with a sourcing agent :

  • Some sourcing agents do not connect the buyer with all the vendors. In situations like these, the buyer incurs a loss
  • Since some sourcing agents act as a link between the factory and the buyer, the buyers become very dependent on the agents.