What is MOQ (minimum order quantity)?

For a buyer, the MOQ is a hurdle. For a seller, it is a way to make sure every order is worth taking.

Why sellers set an MOQ

Every order has fixed costs: setting up a production run, picking and packing, paperwork, and the freight. A very small order may not cover them. An MOQ stops the seller losing money on orders that are too small.

For a manufacturer, the MOQ often follows the production batch. A blender can only run so small a batch of a coating, and a film line has a minimum run. For a distributor, it often follows how the product is packed, such as full pallets or full drums.

How an MOQ works

MOQs show up in a few forms:

• Per product: at least 200 kg of one grade.
• Per order: at least a stated total value.
• Per pack size: sold in full cartons or pallets only.
• Per customer tier: a lower MOQ for regular buyers.

Many suppliers combine an MOQ with price breaks, so a larger order earns a lower unit price. That is why the MOQ and the customer price list belong together.

MOQ versus minimum order value

A minimum order quantity counts units. A minimum order value counts money. A seller of low-priced items may prefer a value, and a seller of one expensive item a quantity.

Handling a buyer who wants less than the MOQ

You have options before saying no:

• Offer a sample so the buyer can test before committing to a full order.
• Suggest a stocked grade or pack size that has a lower MOQ.
• Quote a higher unit price for the smaller order, and say why.
• Agree a first small order on the understanding that later orders reach the MOQ.

Whatever you decide, put it in the quote so the buyer sees the MOQ and the price together.

An example from product sales

A coatings manufacturer makes a custom colour in batches, with an MOQ of 500 litres. A buyer asks for 100 litres. The rep ships a sample, then quotes 500 litres at the agreed price and suggests the buyer takes the rest over two orders. The buyer agrees. The rep notes the MOQ on the account so the next quote does not start the same debate.

Related terms

• Customer price list: where quantity-based prices are recorded.
• Lead time: often longer for custom or low-volume runs.
• Quote-to-order: the process where the MOQ must appear on the quote.
• Sales order: the order that records the quantity agreed.

How PromptLab handles it

PromptLab does not enforce an MOQ for you, and it does not manage stock or production. What it holds is the sales side: quantities and prices on each quote line, customer price lists with the agreed prices, and sample requests tracked from request to feedback. Put the MOQ on the quote and in the account notes, and the next rep sees it.

Frequently asked questions

What does MOQ stand for?

MOQ stands for minimum order quantity. It is the smallest amount a supplier will sell in one order.

Is an MOQ negotiable?

Often, yes. A supplier may lower it for a first order, a sample run, a repeat customer or a higher unit price. Ask, and be ready to explain what you can offer in return.

Why do manufacturers have higher MOQs than distributors?

A manufacturer's MOQ is tied to production batches and set-up. A distributor buys in bulk and sells in smaller lots, so it can usually offer a lower MOQ, though often at a higher unit price.

How is MOQ different from a minimum order value?

MOQ is a quantity, such as 500 units. A minimum order value is an amount of money, such as a set dollar total. Some suppliers use one, some the other.