A sourcing agent is an individual or company whose role is to help you identify, verify, and acquire products from suppliers. A sourcing agent also facilitates communication between a buyer and supplier. These agents are often referred to as procurement agents because they do all the heavy lifting of the procurement process in supply chain management. Companies hire sourcing agents to help with the importation of commodities. Hiring a sourcing company requires you to spend some sourcing agent fees. This post focuses on the cost of hiring a sourcing agent.
How much does hiring a sourcing agent cost?
There isn’t a standard sourcing agent fee. This is because the fees differ from one agent or company to the next. Some sourcing agents charge a flat fee, while others may ask for commission. Chinese sourcing agents often charge a five to ten percent commission. However, this depends on many factors, which will be discussed in the next section.
Factors affecting the cost of hiring a sourcing agent
Different sourcing agents charge varying prices. The following are factors that affect the cost of hiring a sourcing agent;
The functions you wish to bestow upon the sourcing agent will influence the amount of money you pay to the sourcing agent. Naturally, the more work the sourcing agent, has to take on, the more the fees. However, this should only be the case if there are added functions other than the primary roles of a sourcing agent.
Sourcing agents with a tone of experience often charge more than their counterparts. This is because they offer higher quality services and are more reliable. On the other hand, sourcing companies or agents starting in the industry usually charge less because they are looking to attract new clients and make a name for themselves in the industry.
The location of the sourcing agent or company will also significantly influence the cost of their services. Chinese sourcing companies are usually cheaper than those from western nations. This is because the country features hundreds of sourcing agents. Therefore, they lower their prices so they can stand out.
4. Niche and products
The industry in which you are working, and the type of products you require may also affect the cost of hiring a sourcing agent. The more complex the products and their manufacturing process, the more work the sourcing agent has to do. For instance, in this case, the agent would have to spend more time looking for a good supplier, inspecting the products, and asking for changes. This will increase the amount of money the agent charges for their services.
5. Length of tenure
The length of your contract with the sourcing agent will also impact the fees. For instance, a one-time sourcing agent fee is lower than a long-term sourcing agent.
Hiring a sourcing agent does not have to cost a lot of money. This is especially the case if you choose an agent from China. It is worth mentioning that the cost of hiring a souring agent is worth all the benefits you will get.