MOQ Meaning and Why Minimums Are Relevant for Custom Packaging

Custom packaging is an integral part of a memorable unboxing experience. It serves as a fantastic branding tool for your online channels. With more and more small businesses considering making the investment in custom packaging, the biggest barrier is often high Minimum Order Quantities (or MOQs). This can make that unboxing experience prohibitively expensive.

MOQs for packaging present the biggest challenge to businesses wanting to make this investment. So, we end up fielding a lot of questions about them from our customers. This 'How To' guide is an introduction to what MOQs are, why they exist, and how to get the best results for your budget!

What is MOQ?

'Minimum order quantity’ (MOQ) refers to the smallest number of units that a supplier (in this case, us at noissue) will make for a single order. Although we usually think about MOQs in reference to custom-designed goods, we all have to navigate MOQs constantly in everyday life as well.

For example, it isn't usually possible to buy only a single chocolate-chip cookie in a grocery store - they come in pre-packaged boxes. So, if each box has 12 cookies, then 12 is the MOQ for that particular supplier. (Which doesn’t sound so bad when it’s cookies…)

Why do MOQs exist?

We get it; MOQs can be a real headache for small businesses. But there are several good reasons why suppliers use them!

Every supplier needs to ensure that a production run is as cost-effective as possible, or they could end up actually losing money on orders in the long run. To continue with the (delicious) cookie example, it isn't particularly productive or cost-effective for a supplier to make only one cookie per batch. It's also pretty much possible to find a recipe for one! It's far easier for them to both make and sell them in bulk.

This is even more important when a product is a custom print or design, as is the case with branded packaging. This is because there is no possibility of the design being mass-produced or for any excess to be sold on. Without MOQs for packaging, it would be much more cost-effective to only manufacture a set of standard colors or designs, which is far less interesting for businesses!

So, a supplier's MOQ requirement is set to ensure that they can make a minimum profit off every order.

Having MOQs for products is also a way for suppliers to ensure that they are manufacturing to a high quality. If MOQs are variable, quality control becomes very difficult.

Supplier MOQs are therefore a guide for the size of business a supplier specializes in working with. Many suppliers partner with large corporations, meaning they are only set up to produce large-scale orders. By setting a higher MOQ e.g. 1000+ units per order, they communicate clearly to potential customers what their capabilities are. It's important to check supplier directories in advance of contacting, so that you know what ballpark you are dealing with.

At noissue, we aim to remove the barriers to high quality custom packaging for small businesses. As a result, our MOQs for packaging are some of the lowest on the market to make it as accessible as possible.

How do suppliers set their MOQ?

MOQs can vary widely between products and suppliers, and this is decided by a variety of factors such as:

The cost of raw materials.
The MOQs set by their own suppliers.
Whether the product is custom designed.
The cost of running the production line.
The cost of shipping and storage.

So, don't trust a supplier when they tell you that what they offer is 'industry standard' - there really is no such thing! MOQs can also differ between regions, so what is standard in Hong Kong may not be the same in North America (Canada and the United States). Chinese manufacturers in particular are known for the ease of bulk ordering, so China MOQs are commonly higher than elsewhere.

It's very important that you do your own research to find suppliers who can fulfill your needs. For example, noissue's MOQ for packaging varies between products in our range; our tissue paper and stickers both have a MOQ of 250 units due to being custom-designed and the cost of ink, while our compostable mailers have a lower MOQ of 100 units because they are a stock design. This way, we can serve businesses who only want a small quantity of packaging, and those wanting wholesale orders!

How to negotiate MOQs for custom packaging as a small business

Now that you have a better idea of how MOQs in orders work, it's time to look at what you can do to make them work for you!

A high MOQ for packaging can seem like an impossible barrier for small businesses, especially for those who are just starting out and are cautious about the investment. Even just meeting the MOQ can be a challenge, let alone exceeding it to get a better price per unit.

These handy tips will help your business to get the best value from your orders with us:

Consider how you may use more of some custom packaging elements than others.

If you have multiple custom packaging elements in your order fulfillment strategy, it's unlikely that they will run out at the same time. This is something you will need to factor in when placing orders, or you could leave yourself short! This is a great way to both prevent you from unexpectedly running out of supplies and to maximize the value of your orders.

For example, an average parcel for one of your online orders might take two sheets of custom tissue paper to wrap, but only one custom sticker to seal the outside. This means your tissue paper will run out twice as fast as your stickers. So, a hypothetical order of 250 stickers and 500 sheets of tissue paper ensures that you are covered on all fronts for a given period of time.

Utilize storage space.

Our MOQs are designed to give customers the best possible price per unit. The bigger the order is, the more the price per unit will drop. This makes it better value for businesses to place larger orders of packaging supplies at one time. It's also far more efficient in comparison to placing multiple orders throughout the year and having to factor in lead times.

If you have the storage space available in your workplace, it may be worth the upfront investment of buying more units to last you longer. An upside of compostable mailers, as opposed to custom boxes, is that they take up far less space to organize and store! Both the MOQ and the price per unit is also much lower for mailers, as the cost of printing is usually less.

Take advantage of low MOQs with seasonal packaging designs.

While ordering a small run of packaging will cost you more per unit, you can definitely make this work to your advantage as a retailer. Seasonal packaging designs or custom logos have traditionally been out of reach for smaller merchants, but low MOQs make it possible to order custom designs specifically for a limited period in the calendar.

If there is a big retail holiday coming up, such as Christmas or Valentines Day, you have a great opportunity to capitalize on people's gift-buying needs by offering a value-added gift wrapping option! It makes your brand far more memorable, and allows you to capitalize on your status as an independent retailer.

MOQs shouldn’t make sourcing custom packaging impossible; in fact, they can actually save you money in the long run! An MOQ for packaging can also help to guide your order fulfillment and marketing strategies for the better; you just need to consider how you can make them work to your advantage. Getting getting creative with seasonal designs and storage will help you to meet the MOQ that works best for your business.