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What to Do When a Customer’s Needs are Less Than Factory’s MOQ

Last November, a customer asked us to source 1000 pcs of “Potty Pad”. The customer wanted the packaging box to come with its own design. However, the factory’s Minimum Order Quantity (MOQ) is 2000, which was much more than the customer’s needs.

The factory said the MOQ for this product was 2000 pcs mainly because their box supplier had this MOQ for customized packaging boxes. Printing 1000 boxes will waste more materials than 2000 pcs, thus the price for each box will be much higher than printing 2000 pcs one time. If no need for own design box, the factory is fine with 1000 pieces order.

Our customer said it is a new product for him, and he only needed 1000 pcs for a start. But he needed customized packing with his company logo on the box. If it sells well, he can get more products in the future. However, he didn’t want to take risks by buying 2000 pcs in the first order.

After negotiating with the factory, we suggested 3 solutions to solve the problem:

  1. Only order 1000 pcs, but pay $0.3 higher for each because the MOQ is 2,000 pcs.
  2. Make an order of 1000 pcs for the product and print 2000 pcs of boxes. The rest of 1000 pcs of boxes can be reserved for the next order. The customer only needs to pay for 1000 pcs of the product and 2000 boxes during the first order (a box is $0.5 each).
  3. Order 1000 pcs of products and print 5000 boxes. The rest 4000 boxes can be reserved for future orders. The factory offers 5% off because we are able to buy 5000 in total. The customer will only pay for 1000 products (5% discount) and 5000 boxes during the first order.
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The customer chose solution 2 because he could buy 1000 products by using the same price as for 2000 pcs. He also got a customized design for the boxes. If 1000 products are sold, he can buy 500pcs or 1000pcs during the next order and only pay the products’ price without paying for the boxes. Even if the sales turn out bad and he doesn’t need these products anymore, he will only have lost the money for 1000 boxes, which is still better than ordering 1000 pcs only, paying an extra $0.3 for each.

In the end, he sold the products came back for the remaining 1000 pcs 1 month later.

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