When you walking around in the markets , will often come across suppliers who say we only do wholesale,we do not accept retail orders.
Sometimes, they also have a relatively high minimum order quantity (MOQ). But what if you only need a small quantity, your order does not reach their MOQ?
Why do some factories refuse small orders? What is the reason behind it?
Let me explain to you;
Chinese factories don’t accept small orders is not they don’t want to make money. In many cases, they refuse them because the numbers don’t work.
1.The Cost of Starting a new product
Take a factory that makes customized hotel chairs as an example
When the factory receives a new order, They need to stop the current production, adjust the machines, change molds, prepare materials, and arrange workers for the new production.
Whether you are ordering 50 chairs or 500 chairs, All these steps take almost the same amount of time
The difference is that the profit from 500 chairs may be enough to cover cost of changing the production line
But for 50 chairs, it may not cover.
So even if the factory has the capacity to make your chairs, taking the order is simply But not make financial sense for them.
2.Raw material
The factory’s has own supply chain for raw material.
For example, you want a particular fabric for your hotel chairs.
The fabric supplier may have a minimum order of 500 meters.
But your order only requires 150 meters.
The factory then has to buy the full 500 meters and find somewhere to store the remaining 350 meters.
Maybe they will use it for another order later. But maybe they won’t use it for a very long time.
That extra material takes up warehouse space and ties up money.
At this case,The factory has two choices: add the extra cost to your order, or decide that your order is not worth taking.
3.Production Schedules
During the busy season, a factory already have its production schedule and it is always full,The production capacity is limited
If they use a production slot for your small order, that slot cannot be used for another customer.
If they have a large customer who places several orders every year and pays on time.
Then there is a small customer who may only order once, and only take a small order,What he will choose.
It is not really about whether the factory wants make money.
It is about whether the order makes sense for the factory’s production and costs.
What Can You Do If Your Order Is Too Small?
Find a smaller workshop to produce your order
The unit price will be higher, but smaller workshops are flexible with quantities.
Or work through a trading company.
They will combine smaller orders from different customers and place a larger order with the factory.
If you are planning to source furniture or building materials in Foshan Please feel free to contact us.
