MOQ (Minimum Order Quantity) in manufacturing refers to the smallest quantity of a product that a manufacturer is willing to produce or sell in a single order. It represents the minimum number of units a buyer must purchase to begin a production run or to place an order.
MOQs are set by manufacturers to ensure that the production process is cost-effective and efficient. It accounts for factors like production setup, labor, material costs, and overhead expenses. By having an MOQ, manufacturers can avoid the inefficiencies associated with smaller, less profitable orders.
MOQs vary depending on factors such as:
Production capacity: The amount of product that can be efficiently produced in a given time frame. Material costs: Bulk buying of materials can reduce costs, and MOQs help ensure manufacturers can buy raw materials in larger quantities. Machine setup: Certain products may require specific machine setups or molds, which can be costly for small orders. For buyers, understanding the MOQ is important as it affects order volume and cost structure, especially for small businesses or startups.