The wholesale industry is thriving against all the odds stacked against it over the last couple of years. Let’s celebrate! But first, we’ve curated a list of 7 wholesale tips geared towards helping you keep your business operating smoothly and fortify it from any unforeseen future events.
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If you are managing to operate a successful small wholesale business without an inventory management software, kudos to you! However, if you are growing, you will quickly find that relying solely on QuickBooks and manual methods is not enough. Before you know, during a peak sales season, the lack of automation, centralization, and streamlined operations within your business could quickly lead you to go belly up or, at least, fail to maximize profits. In order to optimize, strengthen, and grow your business, our first of the wholesale tips is to consider an inventory management software compatible with QuickBooks!
Data, data, data! The second of our wholesale tips is to collect it and learn from it. Your inventory software should provide you with the tools to better understand your customers, the products they like, the ones they don’t, the products they don’t even know they need yet, and your overall market as a whole. With business intelligence tools like an operational CRM, demand forecasting, sales and trend analysis, and other drilled down reporting, you will be able to understand your customers better than they understand themselves – and that is not a bad goal to strive for.
Inventory is a wholesaler’s bread and butter, as you very well know. But when it isn’t managed correctly, you find yourself facing overstocks, shortages, dying inventory, and increased overhead. Utilize your inventory software itself as well as the business intelligence tools mentioned above to make purchasing smarter. Wholesale tips no. 3 is to maintain a slim inventory as a healthy way for wholesalers to keep what is needed on hand, but never too much more or less, which in the end, reduces overhead, and keeps cash flowing smoothly.
Seamless ordering, regardless of channel, goes along with the first tip provided. When your operations are centralized, orders coming in from any channel will be treated equally, while also providing you the ability to sort, filter, and prioritize fulfillment as needed. One of the best ways to ensure customer loyalty is to make their buying experience from you simple, easy, fast, and error-free.
As a wholesaler, you already know how the game works. The point of wholesale is to offer products in bulk with a discount to your buyers, but in the end, you still want and need to make profit from the transactions. Your inventory management software can come in handy when trying to determine the right pricing strategies for you and your customers without bring your profit margins down. Wholesale tips no. 6 is to require minimum order requirements for an order to qualify as wholesale. Alternatively, just understanding the true costs of goods with landed cost and other costing methods can ensure you are offering the most competitive pricing you can while keeping the rest in your pocket.
While this is the final wholesale tip, it is not any less important than the rest. Customer service keeps your customers coming back, helps spread the good (hopefully) word about your business, prevents negative reviews, and sometimes aids in expanding into other markets. When your business is centralized, any questions about a customer, a product, a tracking number, etc. should be able to be pulled up within seconds, and the answers you need ready and waiting. The faster the service, the happier the customers.
Are you curious about buying wholesale items to sell online? For some people, it’s a confusing and daunting process, while for others it’s proven to be a profitable business model. In this article, we’ll discuss the ins and outs of wholesale buying, how to find the best wholesale items to sell, and where to sell your products, as well as a few myths about the process of wholesale buying.
The key differences between wholesale and retail buying are the quantities of products purchased and the prices of the products. Wholesale buyers purchase a large quantity of products from a supplier at a reduced cost with the intention of selling them in a retail setting, whether that’s a brick-and-mortar store or an online shop.
Wholesale prices are always a good deal lower than retail price because wholesalers often get their products directly from a manufacturer or distributor. If you think of a retailer as the middleman between a manufacturer and the customer, wholesale buying cuts out that middleman and the added costs that come with it, such as their employee wages, shop fees or rent and marketing costs. Without these extra costs, a wholesaler is free to offer their products at a lower price while still enjoying a profit.
As we discussed above, the main benefit is savings. Wholesale buying allows you to avoid all the markup that comes with buying retail, which has to cover the retailer’s:
Wholesale buying allows you to purchase products in bulk at a heavily discounted rate. These savings will pad your profit margins once you’ve factored your own expenses into the final price you list on your store.
Buying wholesale will also allow you to build relationships with wholesale suppliers, which can lead to negotiations for better prices, higher quality, faster shipping speeds, and more. The more business you do with your wholesale suppliers, the more incentive they will have to give you the best experience and deals possible.
Learning how to buy wholesale can seem like a daunting process at first, but once you’ve worked with wholesalers and learned how to source the best products for your online store, everything becomes easier.
Next, we’ll go over some of the top myths about wholesale buying.
Now this is a particularly popular myth. As the world's biggest marketplace, eBay has made its fair share of millionaires. What you don't hear about so commonly is all the people who struggle to make a profit from eBay because 100 other people are selling the exact same products for more competitive prices.
This is not a new situation. Supermarkets and large discount stores often run at a loss on some items in order to attract more customers. For small or new sellers, this is a deadly scenario.
The fact is, eBay is simply too competitive in some categories. Electronics, designer clothing, and computer games are all dangerous territory for the new seller. You won't stand a chance against established sellers who've already got a strong following and highly competitive prices.
So what should you do? If your product falls into these or any other highly competitive category, I recommend shifting your focus to less competitive markets such as classified newspapers in your local area, or eBay alternatives such as Craigslist or Bonanza. You can also find sites that cater specifically to certain niches, such as Newegg for computers and electronics.
It's also a good idea to try using eBay international sites such as eBay UK or eBay Australia, as well as other auction sites with less competition, such as Amazon.
One advantage of eBay US, however, is that the huge amount of competition makes it a brilliant place to pick up cheap goods to sell elsewhere! It's not uncommon to find the best prices on eBay.
The Internet provides easy access to many wholesalers and a quick way of making initial contacts. However, it certainly doesn't provide access to all wholesalers.
If you're serious about finding the best wholesale prices for your products, then it pays to check out other sources as well. Try looking through trade magazines such as Closeout News and Wholesale Merchandise. With fewer people vying for stock, there's a good chance you'll find some exceedingly good prices tucked away in the corners!
Finally, building up personal relationships with suppliers is absolutely essential for getting the best-priced goods. So whether you've found your supplier online or in a magazine, it’s important to make a call, start up an exchange, or have regular chats on Skype and get to know them.
The time you spend building a relationship will put you in a stronger position to get better prices. Also, because you know your supplier, you will feel more confident that things will go smoothly when you finally do place your order.
Whenever I mention this one, people always chorus, “But of course we know research is important!” Well, why don't you spend more time doing it, then?
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The number of people who pass over pricing research constantly amazes me. Everyone always agrees that it is important to research prices, but when it comes down to it, they seem to think that they just “know” how much items cost wholesale, and how much profit they are likely to make later.
But how can they just “know”? Prices are constantly in flux, and carrying out some decent (and yes, time-consuming) research is essential to a successful business for two reasons:
Firstly, it's important to get a good idea of the average resale price for your item before you get started. For a number of popular items (DVDs, electronics and computer games in particular), the profit margins tend to be very low.
Despite this, many sellers see the popularity of the item and dive in head first. Oversaturated markets just mean a hell of a lot of work for very little in return. Throw big, established sellers into the mix and it's almost impossible to compete.
You won't know which markets are oversaturated until you research them! So visit auction sites and read classified ads and any material you can get your hands on until you know exactly what you're getting into.
Secondly, your preconceptions of value may be completely wrong. People have a tendency to believe that “wholesale” automatically means a fifth of the retail price. This is usually totally incorrect!
Some sellers have emailed me in shock when they realize that they actually have to spend a significant amount of money on their wholesale stock. “I always thought that purchasing a container of wholesale plasma TVs would only require a few hundred dollars’ investment, but it looks more like several thousand!” wailed one seller recently.
Well, I'm sorry to shatter your hopes and dreams, but buying wholesale doesn't always mean huge profits for very little investment. For some items, such a scenario is possible, but only if you do the research!
Finding a niche item that no one else is supplying at a competitive rate is every seller's dream. However, if you think you're going to be able to find a wholesale supplier for left-handed guitar necks by doing a quick Internet search, then you couldn't be more wrong.
Niche products are hard to find precisely because they aren't wanted by absolutely everybody. Thus, finding a supplier will take quite a bit of work on your part, as these items usually can't be purchased from independent wholesalers. Instead, you'll have to contact large wholesalers, or even the manufacturer.
You can buy just about anything online at wholesale prices and quantities. Here are a few basic steps to getting started with buying wholesale items online:
Do you have a specific product niche or brand you’re trying to build? Are you looking for higher sales volumes or larger profits on specific high-ticket items? Will you store the items yourself, or are you following a drop ship sales model?
If you’re in the United States, you’ll need a federal tax ID and may need a sales tax license if you want to buy and sell wholesale items online. Check your local laws and be sure you’ve done all the necessary paperwork to avoid having your business shut down.
Online directories can help you find trusted wholesale suppliers and provide you with tools for deciding the best wholesale items to sell. Later we’ll tell you about some of the best places to find wholesale sellers.
Ask questions about what they have to offer, their policies for wholesale buying and what deals they can offer you. It’s important to find a wholesale seller you can trust.
Don’t be afraid to ask for perks or added discounts. You might be able to negotiate a sample shipment before committing to a large order.
This step will take some time and research. When searching for the best places to buy wholesale, you’ll need to consider factors such as product price and quality as well as features of the wholesale supplier itself, including any additional fees, their reputation, and any extras they can provide such as packaging or shipping options.
Online directories are great places to find reputable wholesale suppliers. These sites provide lists of wholesale suppliers for thousands of products in a variety of categories. One benefit of using certain directories, like SaleHoo, is that all wholesale suppliers listed will be pre-vetted for quality, saving you precious time and helping you avoid the pitfalls of landing a disreputable wholesaler that could sink your business.
It might surprise you to hear that finding suppliers locally is actually one of the best ways to buy wholesale items. A quick Internet search will help you find local wholesalers or even wholesale tradeshows in your area. While it may seem like a waste of time when compared to finding wholesale sellers online, looking locally is a great way to network and find even better deals, and allows you to meet your suppliers face to face.
Millions of people all over the world are reselling wholesale items online, so choosing the best wholesale items to sell can be tricky. You need to find products that people want to buy, but you also need to find products that not many others are selling. Avoid products that nobody wants or that everybody is selling. Here are a few good niches to get you started:
Now that you’ve sourced and purchased your wholesale items, you’re ready to start making sales! Here are some of the best places to sell wholesale items:
Bonanza: Although Bonanza is newer than eBay or Amazon, it’s proven to be an effective alternative, with a user-friendly platform and helpful listing tools. The Sellers’ Choice Awards has praised Bonanza as the most recommended selling venue.
Amazon: Amazon boasts the world’s largest online marketplace and is one of the most visited websites to date. With Amazon, you’ll enjoy the potential for millions of visitors, but you’ll also be competing with a large seller base.
Craigslist: While you certainly won’t see the same traffic volume as you might through a major retail site, Craigslist is a great place to sell just about anything in a simple, straightforward platform that almost everyone uses. It’s ideal for selling your products locally and doesn’t require listing fees like most sites will.
Your Own Store: If you really want to stand out from the crowd, setting up your own online store is the way to go. This option allows you to maximize your profits and build a lasting brand online. You’ll enjoy better options and fewer competitors when you run your own store, but you’ll also need to put additional effort into marketing and advertising as you build your brand and reputation.
Buying wholesale items online and reselling them can be a great way to make money—it just takes good research and careful planning if you want your online business to be a success. As long as you do your market research effectively, take the time to find a good supplier and work hard, it will pay off.
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