Pakistan is a constant in the lists of the largest exporters in different categories of products in the world. The country’s exporters manufacture products at comparatively lower prices and with good quality.
However, gaps in communication and online presence are among some of the obstacles that businesses face when importing from Pakistan. This is where sourcing agents from Pakistan step in.
Sourcing agents act on your behalf to procure supplies for your business while keeping your given procurement objectives. These sourcing agents can play a pivotal part in your business in terms of performance because of their advanced knowledge and network of Pakistani manufacturers. However, sourcing agents themselves can also present issues.
Therefore, in this article, we will answer the question whether you should use a sourcing agent when importing from Pakistan or not. We will highlight some of the benefits and the drawbacks of using sourcing agents from Pakistan.
Benefits of using sourcing agents
Local Knowledge
The Pakistani market can be difficult to navigate through and find reliable top suppliers. This problem is even more exaggerated by the fact that many manufacturers in Pakistan do not maintain a strong online presence and therefore contacting them can be cumbersome.
Sourcing agents have quite vast networks and contacts established because of their local knowledge. This can be beneficial as you will not have to spend hours on the internet and through business directories to find a suitable supplier.
Thus, agents will save you time and find you a supplier that suits your requirements the most. Hence, the local knowledge of the Pakistani market will stand as a crucial benefit of using sourcing agents from Pakistan.
Reduce overall business costs
Sourcing agents from Pakistan can help you find suppliers that offer the lowest of prices and are able to negotiate on your behalf with the suppliers according to your guidelines. This will reduce the cost of sales for your business and increase your profit margins.
Moreover, sourcing agents are essentially third parties that you outsource your procurement department to. This means that you will be able to save on salaries and other costs associated to running a supplies or procurement department.
In addition, agents can help with market research, customs, quality checks, and other logistic-related costs. These savings will reduce your total cost while maximizing your total profit.
Although you will have to pay for these sourcing agents, generally the financial benefits of using sourcing agents will outweigh the financial costs.
Hence, using sourcing agents will reduce overall expenses and, hence boosting your profits.
Quality assurance checks
Sourcing agents, on behalf of the businesses, will run quality checks. This will ensure that products that you are receiving are of the finest quality so that you do not face any issues.
This is an imperative benefit because, you as a business, are overseas and are unable to perform physical checks and suppliers can sometimes share misleading pictures/videos of the products.
Hence, using a sourcing agent from Pakistan can allow a business to have quality checks in person on the behalf of the business which otherwise was not possible and consequently the quality of the product being received was not reliable all of the time.
It is pertinent to remember that not all Pakistani manufacturers are top quality producers and thus this can prove to be a very important benefit.
Mitigation of risks involved
Importing from Pakistan and any overseas country will mean that you as a business will be exposed to uncertainties and risks because of some factors that you cannot control. Risks are even more severe when you are importing from countries like Pakistan because of issues with the government officials and loose legality.
Using a sourcing agent who has local knowledge will be able to absorb these risks and act like a filter where on your end you receive your required supplies with minimized risks.
An example would be corruption among government officials who may not allow your supplies to be exported and other similar red-tapism which can massively hurt your business. As such, sourcing agents can mitigate these risks and navigate around them which you may not be able to do so.
Other risks involve political uncertainty and labour issues. Sourcing agents because of their local knowledge about Pakistan will be able to avoid these and connect you with suppliers with no such problems.
Therefore, using sourcing agents from Pakistan will help you to navigate around and mitigate the risks associated with importing from Pakistan.
Drawbacks of using sourcing agents
It is not all rosy when using sourcing agents as no method is hundred percent drawback-free. There are some issues when you use sourcing agents from Pakistan.
Hidden commissions
Sourcing agents may partner up with certain suppliers who may have contracted with the agents to provide them commissions from the sales. Therefore, such agents might compromise quality and prices to connect businesses with such suppliers to benefit personally.
This is a major drawback that can render all the other benefits of using a sourcing agent useless.
This can be a real risk because it is a recognized instance and has happened with businesses when using sourcing agents from Pakistan. However, this risk is not unavoidable and there are measures to navigate around this risk.
We recommend that you use well-established and reputed sourcing agents/companies; in addition to more professional services, you will avoid such ulterior motives.
Lack of professionalism
Sourcing agents may be unprofessional; this means that they may not be able to meet deadlines, communicate ineffectively, or provide poor customer service in terms of pre and after-sales.
Instead of reducing overall business expenses when using sourcing agents from Pakistan, such behavior can increase costs because of inefficiencies on part of the sourcing agents.
Again, as the drawback covered above, this is a real risk that businesses may face when using sourcing agents from Pakistan. Appropriate measures can be taken to avoid this risk and this is not an unavoidable risk.
Conclusion
In the end, we conclude that the benefits of using a sourcing agent from Pakistan outweigh the drawbacks given that you choose reputable and well-established sourcing agents/companies.
You must abandon a sourcing agent at the first sight of any red flag and must conduct prior research before choosing your sourcing agent.
So, provided that you work with a professional and a reliable sourcing agent when importing from Pakistan, the benefits are far more than listed here and your business performance will skyrocket.
Please note that this article is according to our research and opinion and only serves to shed light on the question of whether you should use a sourcing agent when importing from Pakistan; the final decision relies on you.