Originally posted by Sabaithal:

He will show up once you get around 250 meters of him I think? You don't have to literally run into him, you just have to get somewhere nearby, and his icon will show up on the map.

Sometimes it takes forever. We managed to get to the bonemass before finding him by accident.

Same here, Ive killed Bonemass and built a substantial base, but still no merchant, and i'd rather not cheat