Step 0 – Decide if the product is worth sourcing

Before you think about factories, confirm the product makes sense commercially. It’s painful to spend weeks sourcing a product that will never make money.

  • Rough selling price and target margin
  • Realistic order volume (first 12 months)
  • Regulatory/compliance requirements in destination markets
  • Any “must have” features that will drive cost

At this stage you don’t need perfect numbers—just enough to know you’re not chasing an impossible landed cost.

Step 1 – Lock your product brief and constraints

The biggest mistake we see? Approaching factories with vague specs: “something like this”, “good quality”, “not too expensive”.

Instead, build a simple one-page brief that covers:

  • Core materials and dimensions (with tolerances)
  • Target quality level (with real-world references if possible)
  • Mandatory certifications or test reports
  • Packaging expectations and any retailer requirements
  • Desired Incoterms (FOB, EXW, CIF etc.)

The clearer your brief, the easier it is to compare suppliers like-for-like—and the more seriously good factories will take you.

Step 2 – Build a structured supplier shortlist

Your goal here is not to find “the one perfect factory” immediately. It’s to find a small, realistic shortlist that fits your brief and volume.

Sources you can use:

  • Online platforms (Alibaba, Global Sources, industry directories)
  • Trade shows and industry events
  • Existing networks and referrals
  • In-region sourcing partners who can visit in person

For each candidate, track a few simple fields in a spreadsheet: location, product focus, export markets, certifications, min order quantities (MOQ), and first impressions from communication.

We typically narrow this to 3–7 serious options before moving forward to quotes and samples.

Step 3 – Quotes, samples and early risk checks

Now you want to see how each supplier performs when things get a little more specific.

Request structured quotes

Instead of vague “how much?” emails, send each supplier the same quote template:

  • Unit price at different volumes (e.g. 500 / 1,000 / 3,000 units)
  • Tooling or mould costs (if any)
  • Packaging options and price differences
  • Standard lead time and maximum capacity
  • Payment terms and typical deposit percentage

Order samples with a test plan

When samples arrive, don’t just “look and feel”. Have a short test checklist:

  • Does it match the agreed spec and drawings?
  • Any obvious workmanship issues or weak points?
  • Does packaging survive basic handling and drops?
  • Is branding/printing aligned with your guidelines?

At Product Sourcing Solutions, we often combine sample checks with in-person factory visits—seeing the line tells you far more than a perfect sample.

Step 4 – Contracts, deposits and production plan

Once you’ve chosen your preferred supplier, it’s time to formalise expectations before any deposit moves.

At minimum, you want written agreement on:

  • Final specification and approved sample(s)
  • Unit price, payment terms and Incoterms
  • Production timeline and key milestones
  • Defect thresholds and what happens if they’re exceeded
  • Responsibilities for certifications, testing and documentation

For larger or more complex projects, a proper manufacturing agreement is worth the extra effort. If you’re unsure, speak to a lawyer who knows your destination market and the production country.

Step 5 – Inspections and pre-shipment checks

This is where many brands lose money: they skip inspections to “save cost”, only to discover issues when stock arrives in their warehouse.

A basic inspection plan usually includes:

  • Pre-production checks – materials, components, tooling.
  • Inline inspections – spot checks while production runs.
  • Pre-shipment inspection – final checks before balance payment.

An inspector (either your team, a third-party or a sourcing partner like us) works through a checklist, takes photos and videos, and reports any issues with a clear recommendation.

The cost of one proper inspection is tiny compared to the cost of a rejected batch, emergency rework or product recall.

Step 6 – Landed cost, debrief and retention

Once the shipment lands and you’ve seen how everything performs in the real world, take time to debrief. This is how you turn a one-off order into a repeatable supply chain.

Calculate true landed cost

Include everything, not just unit price:

  • Ex-factory cost and packaging
  • Inland transport and export fees
  • Ocean/air freight, insurance and surcharges
  • Duties, taxes and port charges
  • Inspections and any rework costs

Score the supplier

Even if you don’t have a full retention system yet, a simple scorecard helps:

  • Quality consistency
  • Adherence to timelines
  • Communication speed and clarity
  • Flexibility when issues came up

Suppliers who score well are worth investing in: better forecasts, clearer briefs, and collaborative cost improvements over time.