When starting or growing a dollar-store business or any import venture, understanding MOQ — Minimum Order Quantity — is essential. MOQ affects your profit margins, inventory, cash flow, and supplier relationships.
What Is MOQ?
MOQ is the smallest number of units a supplier is willing to sell in a single order. For example, a supplier may require 500 units of a product or a minimum order value, like $2,000. If you try to order less, they may refuse or charge extra.
Suppliers use MOQ to cover production costs, reduce waste, and work with serious buyers.
Why MOQ Matters for Your Business
MOQ influences several important aspects of your business:
- Costs and Profits: Larger orders usually lower your unit cost, improving margins.
- Cash Flow: High MOQ means more upfront investment, limiting available capital for other areas.
- Inventory Management: You need space and sales velocity to handle MOQ without overstock.
- Supplier Relationships: Meeting MOQ shows you’re serious, building trust for future flexibility.
Examples of MOQ
Typical MOQs for dollar-store products vary:
- Home & Kitchen: 500–1,000 units
- Toys & Party Supplies: 300–1,000 units per SKU
- Electronics: 500–2,000 units
- Apparel & Accessories: 500–1,000 pieces, sometimes per color or size
Many factories have lowered MOQs in recent years to attract smaller international buyers.
How to Decide the Right MOQ
Don’t accept the supplier’s MOQ blindly. Consider:
- Sales Forecast: Only order what you can realistically sell.
- Landed Cost: Include product, shipping, customs, and storage.
- Testing the Market: Start small to validate demand.
- Combined MOQ: Mix SKUs or colors to meet MOQ requirements.
- Inventory Risk: Avoid tying up too much capital in unsold stock.
How to Negotiate or Reduce MOQ
- Work with smaller factories that are more flexible.
- Order during slow seasons.
- Offer to pay slightly more per unit for a smaller quantity.
- Combine several products to meet MOQ.
- Choose existing designs or materials the factory already produces.
- Build long-term relationships to gain trust and flexibility.
Common Pitfalls
- Ordering too much before knowing demand.
- Ignoring shipping and import costs.
- Assuming MOQ applies to the total order rather than per variant.
- Depending on a single supplier.
Key Takeaways
- MOQ ensures suppliers stay efficient and profitable.
- For importers and dollar-store owners, understanding MOQ helps avoid overstock, reduce risk, and plan cash flow.
- With smart planning and negotiation, MOQ can work in your favor to grow a successful business.
