MOQ – Minimum Order Quantity

What is MOQ (Minimum Order Quantity) and how does it affect production and procurement decisions?

Minimum Order Quantity (MOQ) is the smallest amount of a specific product that a supplier or manufacturer is willing to sell to a buyer. It is a standard practice in many industries, including the sneaker world, particularly when dealing with wholesalers or manufacturers. For sneaker resellers, understanding MOQ is essential when sourcing inventory. Manufacturers or wholesalers set MOQs for various reasons: to cover production costs, ensure profitability, or manage inventory efficiently. For a sneaker reseller, this means that they might have to commit to buying a certain number of pairs of a particular sneaker style or size before a supplier agrees to the sale. MOQs can vary widely based on the product, the brand, and the supplier. For instance, a limited-edition sneaker might have a higher MOQ compared to a general release. When negotiating with suppliers, sneaker resellers must consider the MOQ to determine the initial investment, potential storage needs, and sales strategy. While purchasing in bulk might offer cost advantages, it also comes with risks, especially if the sneakers don't sell as expected. Newer resellers with limited capital might find high MOQs challenging, whereas established resellers might leverage MOQs for better pricing. In essence, MOQ is a critical factor that sneaker resellers must navigate, balancing the benefits of bulk purchasing against the risks of overstocking.