Minimum order requirements are difficult to get right. For example, a large minimum spend will prevent a portion of potential customers from placing a first order (often a sample order used to test a supplier.) On the one hand, a small minimum spend ma…

We are a 50 stores Fashion & Homeware Chain in Middle East. We do bulk of our buying from China & Far East. And there are many SKU’s where we are not able to meet MOQ’s. There either the suppliers ask us to tag along our quantities with other orders they have (delivery date is as per supplier) or they simply refuse. Though we are 50 stores strong, yet there are some categories where we cannot reach MOQ’s. However some suppliers do adhere to our requests as they can see a long term future with us.

Further regarding the Shipping Cost, I agree with you. You need to cover overheads especially when you are doing a Container loads of One Product vis-a-vis to 10-12 items in the container. Here too Let me give you a different story. Though we order qty’s as per our range plans and requirements but we do not take full container loads. Reason – we cannot buy items and get overstock, this will first affect our No of Days in Inventory, later will get into agening and finally markdowns.

Rather we just get the qty’s which we need and if we can cover the transportation cost, we take half container empty. i.e if our Purchase Order value is over 12,000USD then we can take 1 x 20 FCL partially empty, as our costings we be justified.

Further as the fashion is changing and every retailer wants to be in fashion, we need to be very careful on the qty’s. You must have heard about Zara, where they work only on small qty’s and then replace the styles completely by new ones, As they feel the customer should see new merchandise in every 2 weeks.

In above i have tried to give you a prespective from a different angle as your strategy is good for your current business but cannot be benchmarked for everyone.