If your business is growing to the point where you want to be able to buy and sell very large quantities of a product, then wholesale is the thing for you! Buying wholesale means you can order products in bulk, at a reduced price, and sell larger quantities online. If you have several products that are selling well online, it is probably worth checking if you can buy them ‘en masse’ from a wholesale vendor. This way, you ensure you have a steady supply, and you can order hundreds at a time if you wish, rather than relying on single purchases from the online/real life high street. However, before you can start buying wholesale, there are a few things to consider, and a few preparatory steps you need to take.
While you don’t have to be a large corporation in order to deal with wholesale companies, you may be asked for proof that you are a ‘trader’. If you have a Ltd. company, this is no problem, just show them proof, such as your company registration and VAT registration number. If you are a sole trader, this is also not an issue, just be prepared to offer evidence of your vocation. For example, a business card or letterhead with your company name on it. However, remember that different wholesalers have very different requirements for who they deal with, don’t be surprised if the conditions vary wildly from one company to another.
Some wholesale companies may not ask you for any of the above evidence at all, but instead reveal their willingness to trade with small businesses through their ‘minimum spend’ figure. For example, if this is low, say, £50-£100, you can be sure that they are happy to trade with smaller businesses like you! If it is a whopping amount, they are probably offering their services to the larger fish in the pond. But don’t be put off! Take your money elsewhere, and once you’ve established yourself as a big fish you’ll have a variety of contacts to choose from. Which leads me to my next point…
Don’t be afraid to invest time and effort into building a portfolio of contacts in the wholesale industry. Making personal connections often pays off, as you may be offered deals or reductions that you wouldn’t have otherwise. Making contacts like this is self-perpetuating – one business relationship may lead to another, and in this way you build up a network of contacts, who are all hopefully willing to do you a good deal! Don’t expect this to happen overnight, just take it a step at a time and you will soon find that you have a selection of wholesale companies to choose from.
Once you have established a connection with a wholesale vendor they will probably send you a catalogue of the products they are offering. These can be very useful as you can run the products through an arbitrage tool, for example tacticalarbitrage.com (which I have mentioned in previous posts), to see if any of the products are worth scooping up. These tools can compare hundreds of products at a time to those being sold on Amazon, and present you with the ones worth buying.
So, once you have considered these points, get sourcing! Scout out some wholesale companies that are selling what you want and will cater to you, get in contact, and buy buy buy!. Incidentally, if you are at the point with your company where you are considering buying wholesale, it may also be an idea to engage the services of an FBA Prep company to help you with the packaging and sending of your products. The more products you are buying, the more you will have to prepare, and this can be an overwhelming task once your stock increases. Luckily there are companies such as ours which are there specifically to fulfil this need.
If you think you could benefit from our help, contact us at: http://fbaprepcompany.com/contact/
We’d love to work with you!