Sourcing Company – How Is It Different from an Agent?

Many entrepreneurs, innovators, and SME businesses consider looking for a sourcing company or sourcing agent to help them with manufacturing in China for their new business or product. The main reason one would seek out a new overseas supplier would be to launch a new concept. Alternatively, you or your business could have encountered problems with your current supplier or find that you cannot accommodate the rising costs. 

If you find yourself looking for a new company or agent, you may be wondering which one is better or more reliable. You may be asking yourself, Where can I find a reliable sourcing company in China? Or, Should I use an agent?

All of these are valid questions  that we encourage entrepreneurs to ask at the onset of their custom manufacturing process. Our goal here at China Sourcing International (CSI) is to help you understand the differences between a sourcing company and an agent so you can make the right decision for your business.

What is a Sourcing Agent?

Before we get into the weeds about sourcing agents vs. sourcing companies, it is important to identify some key factors about both. A sourcing agent in China is typically an individual person one hires or contracts to find suppliers and factories in China. It’s likely that this person will be unattached to a company and navigating the China sourcing on their own. While this may be fine in certain circumstances, it could also be risky. 

There is a chance this person will not fully understand your business’ needs and hasn’t already worked out the hiccups involved in manufacturing in China and importing from China to the US.

It is also possible that a sourcing agent’s relationship with you will be purely transactional﹘that makes sense, given that this is a business engagement. Still, you’ll want to feel that whoever is handling your new product has you and your business’ best interests at heart. That’s why it may make more sense to use a reliable sourcing company in China.  

What is a Sourcing Company?

A sourcing company in China is an entire organization dedicated to finding clients the best suppliers and manufacturers for their products. Because the goal here is a long-term relationship, a company will be adamant about finding something that will last for both you and them.

Whereas a sourcing agent might procure only 2-3 quotes from a source on Alibaba, we go the extra mile. Working with a sourcing company like China Sourcing International means we’ll go through numerous rounds of exploration to find you the best factory or manufacturer possible.

• We typically contact 10+ factories as part of our research phase
• We get 5-6 reliable quotes
• We then grill those suppliers with questions to narrow down the search
• All our efforts are with the goal of finding you the best possible prices and highest quality end products!

Agent vs. Sourcing Company: Which is Better?

Every situation is unique, but there are key areas to focus on when deciding on whether working with a sourcing company or agent would be best for you.

Capacity: How Much Can an Agent Handle vs a Sourcing Company?

An agent is only one person and can only do so much. While a agent may want to ask potential suppliers and factories the hard-hitting questions about MOQs, flexibility in design, lead times, negotiations in contracts, factory sizes, exporting processes, consolidation, and so much more, they may not have the bandwidth to do so.

A sourcing company has an entire team that can take care of all the details more efficiently and more effectively. Better still, a company or agency will keep everything organized so you have more than sufficient information to make your decision on which supplier in China to go with. 

Legitimacy: How Do I Know if My Sourcing Agent is Legit?

One of the best ways to check the legitimacy of an agent or a sourcing company is to ask for their client references.  By speaking with the clients of the party that you’d like to work with, you’ll be able to clarify unanswered questions and gauge legitimacy. Also don’t hesitate to ask for the company’s Business Registration to double check legitimacy. 

Furthermore, one person (an agent) can talk a big game and be convincing, but numbers don’t lie. A legitimate sourcing company like China Sourcing International will have the client base, portfolio, and numbers to back up their claims.

If you are new to the idea of sourcing overseas, please check out our post entitled A Beginner’s Guide to China Product Sourcing.

Cost: Is it More Expensive to Hire an Agent or a Sourcing Company?

This is usually where people fall into the myth of thinking that working with a sourcing agent vs. a sourcing company will be less expensive. On the surface, working with an agent could cost less for the initial engagement, especially if you only need one or two services.

If you plan to incorporate a sourcing strategy for long-term production, however, having a sourcing company you can trust to partner with is probably going to save you more money in the long run.

There will be fewer re-dos, fewer problems, no nickel-and-diming, and no charging by the hour. Sourcing companies like China Sourcing International see a partnership with a client as an all-encompassing, holistic solution. Sourcing from China is not an “off the shelf” solution. Price matters, but the old adage, “What you pay for is what you get” could not be truer.

For Expertise & Experience – Contact Our Sourcing Company

Are you ready to partner with a reliable sourcing company in China? Contact our sourcing experts to learn more about the sourcing services we offer and the types of products we have sourced for clients in the past.

Give us a call at +1 (888) 915-1060 or email us to get started!