Episode 57 – What a Vietnam Sourcing Agent Actually Does (and What It Costs)
In Vietnam, “sourcing agent” covers three very different business models, and their incentives pull in opposite directions. Rod explains how commission agents, trading companies and independent sourcing partners get paid, what each one really costs you, and the three questions to ask before you sign anything.
AI-generated audio, produced by Vietnam Direct Sourcing from our article on this topic.
Read the article: What a Vietnam Sourcing Agent Actually Does (and What It Costs)
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This episode is AI-generated audio. The transcript has been lightly edited for readability.
Three Different Business Models
In Vietnam, "sourcing agent" covers three completely different business models, and their incentives pull in opposite directions.
The Commission Agent
First, the commission agent. They typically charge 3% to 10%, paid by the factory. Because their income rises when your unit price rises, you rarely see the real factory quote.
The Trading Company
Second, trading companies. They buy from the factory and resell to you with the margin hidden inside. You cannot audit the factory, and you cannot leave with the supplier relationship.
The Independent Sourcing Partner
Third, independent sourcing partners. You pay them directly in task-based fees. You see original factory pricing in writing, and their incentives align with yours.
Three Questions to Ask Before You Sign
Before you sign anything, ask: Who pays you? Will I see original factory quotes? And who owns the supplier relationship if we part ways?
Establish how they get paid before you discuss your product. Never rent access to a supplier when you should own it.