Sourcing is the process of identifying, evaluating, and selecting the suppliers a business will buy from to meet a specific need. It sits at the strategic front end of procurement and answers the question of who you buy from and on what terms, which is distinct from purchasing, the transactional act of placing the actual order once a supplier is chosen.
How it works
A typical sourcing cycle moves through a few stages. First you define the need and specifications. Then you research the market and build a shortlist of potential suppliers. You request information or quotes (often through an RFI, RFQ, or RFP), compare responses on price, quality, lead time, and reliability, and negotiate terms. Finally you select one or more suppliers and set up the relationship. Sourcing can be single-source, dual-source, or multi-source depending on how much you want to reduce risk versus consolidate volume for better pricing.
Why it matters
The supplier you choose determines your cost base, your product quality, and how exposed you are to stockouts or delays. Good sourcing balances the lowest price against total cost of ownership, which includes shipping, defects, payment terms, and the risk of a supplier failing to deliver. Weak sourcing shows up later as margin erosion and fulfillment problems.
Where it fits in B2B quoting on Shopify
On the sell side, sourcing is what your B2B buyers are doing when they send you a request for quote. A purchasing manager comparing three vendors is running a sourcing exercise, and your quote is one input into their decision. Responding fast, with clear pricing and terms, improves your odds of being selected. For a Shopify merchant, that means turning inbound quote requests into accurate, professional quotes quickly. See the B2B quoting glossary for related terms like RFQ and procurement.