Advantages of Small Minimum Order Quantities
One of the first decisions a new manufacture company has to make is how large and what form their minimum order size will take. Minimum order sizes are necessary for a number of reasons: they prevent ordinary buyers from placing orders for single items, they filter out very small businesses that would have been more trouble than their potential business warrants, and they help streamline the order process by increasing the overall size of orders and eliminating small orders.
There are pros and cons to both small and large minimum order sizes, and the option chosen by a particular manufacturer will often depend on the business they are in, as well as the sort of retail establishments they wish to attract as customers. High priced electronics and cheap hair accessories have nothing in common. The minimum order sizes imposed for both would be very different, as would the size and potential of their respective customer bases.
As an umbrella manufacturer specialising in low priced custom umbrellas, I’m convinced that the advantages of a small minimum order quantity far outweigh the disadvantages.
For manufacture companies, finding reliable, repeat customers is what it’s all about. And to do this, you first have to convince these potential customers to place that all important first order. This is not as easy as it sounds, especially when the competition, both offline as well as online, is so fierce.
A small minimum spends also works well for existing customers, in that they can try out small quantities of new lines of stock without significant risk. Most retailers know their customers quite well – they know what they like and dislike, what they’ll buy and not buy, and what they’re prepared to pay. But changing fashions mean that there will be times when a retailer has to take some risk on stock choices or suffer the possibility of getting left behind. The ability to place small sample orders of new lines of stock minimizes this risk and helps to keep regular customers coming back for more.