What is MOQ (minimum order quantity)?
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The smallest amount a supplier will sell you in one order (minimum order quantity).
MOQ (minimum order quantity) is the smallest number of units a supplier will sell you in one order. If the MOQ is 500 and you ask for 300, the supplier will refuse, or quote a higher price per unit.
Why suppliers set an MOQ
A supplier’s costs don’t all grow with the order. Setting up a production run, buying raw materials, packing and shipping paperwork cost roughly the same for 100 units or 1,000. An MOQ keeps each order large enough to cover those costs and still leave a margin.
An MOQ may apply per product, per variant (such as per colour or size), or to the order as a whole. Check which, because a per-colour MOQ is much harder to meet on a range with many variants.
MOQ and your reorder quantity
Your ideal order is set by how fast the product sells and how long a delivery takes. The MOQ is a floor on that quantity. When your ideal order is below it, you either buy more than you need or don’t buy.
Example. A product sells 10 units a day and costs $4.00 a unit. A 40-day order is 400 units, or $1,600. The supplier’s MOQ is 1,000 units, or $4,000.
- Days of sales covered by the MOQ: 1,000 ÷ 10 = 100 days
- Cash tied up beyond the 400 units you needed: 600 × $4.00 = $2,400
That extra stock also takes up space and carries the risk that the product stops selling. A bigger order may bring a lower price per unit, so compare the saving with the extra cash and the risk before agreeing. A lower inventory turnover is the usual result of an MOQ that is too high.
How to negotiate an MOQ
- Combine products. Ask if the MOQ can be met across several SKUs or colours instead of each one.
- Trade price for quantity. Offer a higher unit price for a smaller run, and see if the sum still beats the larger order.
- Commit to repeat orders. A plan for several orders can persuade a supplier to accept a smaller first one.
- Ask for a trial order. Some suppliers will accept a small first order at a higher price while you prove the product.
- Split deliveries. Order the full MOQ but ask to receive it in parts, if the supplier can store it.
Related terms
- Lead time: how long an order takes to arrive. A long lead time pushes you to order bigger batches.
- Safety stock: the buffer on top of the quantity you order.
- Reorder point: when to place the order that meets the MOQ.
- Purchase order: the document that states the quantity you order.
Frequently asked questions
What does MOQ mean?
MOQ stands for minimum order quantity. It is the smallest number of units a supplier will accept in a single order, often set per product, sometimes per colour or per order.
Why do suppliers set a minimum order quantity?
Making a product has costs that don't change with the size of the run, such as setting up machines, buying materials in bulk and handling the order. A minimum lets the supplier spread those costs over enough units to make the order worth taking.
Is MOQ negotiable?
Often, yes. Suppliers may lower it if you pay a higher unit price, combine several products or colours to reach it, accept a slower delivery, or promise repeat orders. Ask what they can change and what it costs.
What is the difference between MOQ and minimum order value?
MOQ is a number of units. A minimum order value is an amount of money, such as $2,000 per order. Some suppliers use one, some both.
What should I do if my MOQ is more than I can sell?
Work out how many days of sales the MOQ covers and the cash it ties up. Then negotiate a lower MOQ, mix variants to reach it, order less often at a higher price per unit, or choose another supplier.