I have worked on both sides of the table, as a buyer in Europe and as a sourcing partner on the ground in China. Sometimes a sourcing agent is the smartest investment you can make, sometimes you are better off talking directly to factories yourself. The tricky part is knowing which situation you are in.
In this article I will walk through a simple way to think about this decision. We will look at when a sourcing agent creates real value, when they mostly add another layer of email, and how you can set up direct factory contact without stepping into the most expensive traps.
A simple lens for the decision
Instead of asking “agent or not” as a yes or no question, I like to look at four factors:
- Complexity of the product and supply chain.
- Volume and risk in terms of money and reputation.
- Experience you and your team already have.
- Time and focus you can realistically invest.
If complexity, volume and risk are all low and you are happy to spend time learning, you can probably talk directly to factories. If two or more of those factors are high, you should at least talk to a sourcing partner before you decide.
When a sourcing agent is usually worth it
Let us start with the situations where I almost always recommend using an agent. You can think of these as scenarios where small mistakes become very expensive, or where local knowledge gives a big advantage.
1. Custom or semi custom products
If you are not just picking a catalogue item but changing dimensions, materials, construction or packaging, a local partner makes a big difference.
- There are more opportunities for misunderstanding, especially when communication goes through chat and email.
- Tooling, moulds and samples need to be specified clearly and tracked over time.
- You may need to move production later, and ownership of tooling must be crystal clear.
A good agent will help you write clearer specs, ask the right questions and push back on vague answers, so that your first production run is much less of a gamble.
2. Multi supplier projects
When a project involves several factories, for example furniture with metal frames from one supplier and wood parts from another, or a product that includes electronics, packaging and accessories, coordination becomes a real job on its own.
- Different suppliers move at different speeds.
- Quality issues show up at different times.
- Shipments need to be consolidated to keep freight cost under control.
Here a sourcing partner acts as a project manager on the ground. They can visit factories, make sure components match and keep your timelines realistic.
3. Products with compliance or safety risk
If your product has to meet strict safety or certification standards, such as furniture for public spaces, electronics, toys or anything that goes into the body, the cost of getting compliance wrong is huge.
- Shipments can be stopped or destroyed at customs.
- You can be forced into recalls or rework that destroys margins.
- Your brand reputation can take a hit that is hard to repair.
In these cases you want someone who understands both the local reality in China and the legal reality in your home market. An agent cannot replace a test lab or a lawyer, but they can make sure that you work with factories that actually have the right documentation and track record.
4. Fast growth or limited internal bandwidth
Sometimes the problem is not complexity but capacity. Your team has more than enough to do with sales, customer support and operations. You know that China sourcing is important, but you do not have the time to spend hours in email threads, WeChat calls and spreadsheets.
In this situation an agent becomes an extension of your team. You still own the decisions, but someone else does the legwork: supplier search, negotiations, order follow up, quality checks and basic documentation.
When you can often go direct to factories
On the other hand, there are scenarios where using a sourcing agent will not add much value or where you can keep them in a lighter role.
1. Simple, standard products
If you are buying standard items with clear specifications, such as generic packaging, simple textiles or off the shelf components, and your volumes are not huge, direct contact can work very well.
- There is less to misunderstand, because the product is already widely understood in the market.
- You can compare several suppliers fairly easily.
- You can always bring in an agent later if volumes grow or you want to develop your own version.
2. Low risk test orders
If your first order is small, for example a few cartons for a new product line or a pilot run for Amazon FBA, you can treat it as a paid experiment.
You still need to be careful, but the main goal is learning: how fast the factory replies, how they handle issues, how accurate their lead times and quality promises are. An agent can help, but if your main risk is a limited amount of stock, you may decide to keep the setup simple and run this first test yourself.
3. When you already have local experience
Some companies already have a person on the team who has lived in China or worked closely with Chinese suppliers. They understand the rhythm, the holidays, the way people communicate and the importance of clear written follow up.
In that case you can often handle direct factory relationships, and use an agent in a very targeted way only when you need factory visits, specific audits or help with complex negotiations.
Hidden costs of going fully DIY
When people compare agent fees with direct factory prices, they often miss the hidden costs that show up in time and mistakes.
Time cost
A typical sourcing project involves a lot of small tasks:
- Finding and screening suppliers.
- Clarifying specs and packaging details.
- Following up on samples and revisions.
- Chasing updates on production and shipping.
If you add up all of those ten minute and thirty minute blocks, you often end up with several full days of work. If that time comes from a founder or senior manager, the real cost is much higher than the invoice cost of an agent.
Quality and communication risk
Even simple misunderstandings can create rework. A slightly wrong shade of fabric, a logo that is placed a few millimeters off, or packaging that does not meet retailer requirements can turn a profitable order into a loss.
A good agent does not magically remove all problems, but they do catch many of these issues earlier, especially if they are able to visit the factory or inspect goods before shipment.
Relationship and leverage
Factories will treat you differently depending on how large and stable you seem. If you place small, irregular orders and only show up once a year, you will naturally be lower on the priority list.
An established sourcing partner often represents several buyers over time. That gives them more leverage in discussions about quality, lead times and problem solving.
What a good sourcing agent actually does
There are many types of agents, from simple trading companies to hands on partners who act almost like your local office. When I work as a sourcing partner for European clients, I try to cover at least these areas:
- Clarify your business model and constraints before we talk to factories. This includes pricing targets, branding, lead times and risk tolerance.
- Search and filter suppliers based on track record, product focus and fit.
- Structure communication so that important decisions and numbers are always captured in writing.
- Coordinate sampling and small trials so you can see real products before committing to larger orders.
- Monitor production and quality through photos, reports or third party inspections when needed.
- Support shipping decisions around incoterms, forwarders and documentation.
My goal is that you can think clearly about assortment, positioning and customers, while I handle the messy part between your ideas and the factory floor.
A hybrid model that works well for SMEs
The decision is not always all or nothing. A model that often works well for small and medium sized companies is: use an agent intensively in the beginning, then taper off.
How a hybrid collaboration can look
- Phase one, setup. We work closely together to find suppliers, negotiate terms and run the first one or two orders.
- Phase two, routine. Once the relationship is stable, you handle most of the day to day communication with the factory. I step in only for special questions or new developments.
- Phase three, expansion. When you add new products or markets, we go back into a closer collaboration for those parts.
This way you learn a lot about the market and keep control, while avoiding the most painful beginner mistakes.
Questions to ask yourself before you decide
To make this practical, here are a few questions you can use as a mini checklist before you choose agency, direct contact, or a mix of both:
- How much money could I lose if this first order goes badly?
- How much time can I realistically spend on sourcing every week?
- Who in my team has experience with China or similar markets?
- How complex is the product and the supply chain?
- Which parts do I feel comfortable owning, and which parts feel unclear?
If your honest answers point towards high risk and low available time, you should talk to at least one agent. If risk is low and you are excited to learn, you can test a DIY path with a clear plan for when to ask for help.
How I usually work with sourcing clients
When I help companies source from China or Vietnam, I try to keep things transparent and simple. A typical collaboration looks like this:
- We start with a short call and a written summary of your goals, constraints and timeline.
- I do an initial scan of suppliers and give you a realistic picture of what is possible at your target price and volume.
- We agree on a sourcing plan for the next one to three months, including samples, negotiations and test orders.
- You always see which factories we talk to and what conditions they offer.
- Fees are structured so that our incentives are aligned with quality and long term cooperation, not only with pushing volume.
The goal is not that you depend on me forever, but that you feel confident enough with your supply chain to grow steadily without nasty surprises.
If you are unsure, start with a conversation
If you are reading this and thinking “I am still not sure if we need an agent or not”, that is completely normal. The decision depends a lot on your specific situation.
If you want, send me a short overview of your product idea, current suppliers and volume, and I can give you an honest view on whether I think an agent would add value for you, or if you can start direct.