Sourcing fee, commission, retainer: which model fits

The most common question buyers ask us in a first call is how we charge. The honest answer is that the right structure depends on where you are in the product lifecycle. Discovery and qualification are paid as a flat sourcing fee or a retainer. Recurring production is paid on commission. A long running engagement usually blends both. This article walks through the four components of our pricing and shows how they add up on two example orders.

The one time sourcing fee

Most engagements begin with a one time sourcing fee of USD 300 to 500, quoted upfront and invoiced only after we have matched a factory to the brief and shared the verification work. The fee covers the brief intake, a shortlist of three to five candidate factories, legal and capability verification, and a written recommendation. We do not charge the fee for work we have not yet delivered.

The fee is priced inside the range based on program complexity. A single SKU from an established category sits at USD 300. A multi SKU brief across a new category with regulatory requirements sits at USD 500.

The tour day

Factory tours are priced by block. A half day is USD 300 (morning to noon or noon to evening), and a full day is USD 500. Both blocks fit as many factories as the route allows and are dedicated to the client, meaning Amy does not run parallel clients on confirmed tour days. Tours can be booked as standalone diligence sessions or inside a sourcing engagement, and ground transport between factories is billed at cost, typically USD 50 to 100 for visits that stay within Shenzhen.

The retainer

Our retainer is structured by concurrent projects, not by factory count. Within a given project, we source and contact as many factories as the project requires. Starter is from USD 1,000 per month for one active project, Growth Partner is from USD 2,400 per month for up to two, Enterprise Operations is from USD 5,000 per month for up to five.

Retainers work best during the qualification and sample phase of a product, where most of the work is engineering coordination, regulatory timeline management, and supplier vetting rather than transactional volume. It is hard to fit this work cleanly inside a pure commission model.

The commission

Commission applies on net order value of orders placed with any factory we introduce or manage. Pilot production is fully exempt. From the second run onward, subsequent orders at MOQ attract 5% to 8%, and subsequent orders above MOQ attract 3% to 5%. Commission does not apply to NRE fees, tooling, certification costs, or anything paid directly to the factory.

Worked example one: single SKU, pilot, then a USD 50,000 first reorder

A consumer electronics buyer briefs us on one SKU. We invoice the sourcing fee of USD 300 after shortlisting and verifying three candidate factories. The pilot run is commission exempt. The first production reorder at MOQ lands at USD 50,000, attracting 5% to 8% commission, or USD 2,500 to USD 4,000. The BOM level cost breakdown we run in parallel with that reorder has, on comparable programs, surfaced more than 5% of margin to renegotiate, which typically offsets the commission inside the first reorder.

Worked example two: USD 500,000 annual volume above MOQ

Same pilot exemption applies. Annual production volume above MOQ at USD 500,000 attracts 3% to 5% commission, or USD 15,000 to USD 25,000. On consumer electronics with operator margins in the 30% to 50% range, this is inside the range that the factory itself would have charged in internal sales commissions. The buyer is paying a similar number and getting a sourcing agent, a pre shipment inspector, and a bilingual project manager rather than a factory sales rep.

Which model for which stage

Discovery and shortlist: one time sourcing fee (USD 300 to 500). Diligence and factory visit: tour day (USD 300 half day or USD 500 full day). Qualification and sample: retainer. Recurring production: commission, with the pilot run exempt. Multi project enterprise buyers: retainer (Growth or Enterprise) with commission overlay on production orders.