Sometimes using a trading company is the smartest choice compared to buying factory direct. Here’s when it makes sense:
✅ Greater Buying Power
When the trading company has significantly more leverage with a factory than you do — and they value your overall business.
✅ Complex Origin Management
When you need a complicated process handled at origin that you're not equipped to manage yourself.
Example: Buying different products from various factories and combining them into a kit exported as a single item.
✅ Spend Efficiency
When your spend isn’t large enough to fragment across many factories.
Focus factory-direct on high-volume lines and use trading companies for the rest.
✅ Lower MOQs & Stock Holding
When the trading company can negotiate lower minimum order quantities or hold stock at origin.
✅ Admin & Logistics Optimization
When you can save significant admin overhead and improve container utilization by consolidating products from multiple factories.
✅ Consistency Across Products
When you need consistent look and feel across products made in different factories — and the trading company can manage that.
✅ High Complexity or Safety Risk
When the product is complex or has a product safety risk — and the trading company has the expertise to manage it.
✅ Vertical Integration & Value Creation
When the trading company is vertically integrated and driving value across the entire supply chain.
Conclusion
Don’t get caught up in blanket judgments about whether you should be buying from trading companies or not.
Instead, be clear on your strategy — and use a hybrid approach.
Choose factory direct or trading companies based on what best supports your goals.