Buying products wholesale for resale purposes is a very common business model. Most stores, whether online or in-person, do not purchase products directly from the manufacturer. Instead, manufacturers sell their products in bulk to wholesalers, who then sell them to businesses.
Starting a business that relies on making wholesale purchases for resale is not as straightforward as you might think. Understanding how to buy wholesale for resale is only half the battle. You also need to figure out what to buy, too.
If you’re just starting your business, this can seem even more daunting. But don’t worry, we’re here to help. Here is a step-by-step guide on how to buy wholesale without a business.
How to Buy Wholesale: Choosing Your Product
First, let’s start with figuring out what products to buy wholesale. There are several factors you should consider when choosing products to sell.
Profit Margins
When you’re reselling wholesale products, your business model relies on profit margins. You need to sell the products you buy for a higher cost than you paid for them. Buying wholesale usually means you get a discounted price. But the price you pay still needs to cover the cost of manufacturing for the manufacturer. Products that are inexpensive to manufacture can offer better profit margins. But, if you set your price too high, nobody will want to buy from you. A good profit margin for online retailers is somewhere between 40-45%.
High Demand, Low Competition
Finding products that are in high demand, but not oversaturated in the market, is crucial when buying wholesale. For instance, pens are always in high demand, but people can buy them anywhere. You will have a tough time standing out if all you sell are standard ballpoint pens. But if you sell niche items, like fountain pens or colorful pens, you will have less competition. This allows you to sell more of your products, often at a higher price point.
Cost of Shipping
Another factor to consider is the cost of shipping. Heavy, bulky, or fragile items tend to cost more to ship. This can eat into your profits, or force you to set a higher price tag when reselling. Lightweight, simple items, on the other hand, are cheap and easy to ship. This doesn’t mean you can’t resell bulky items. But it’s important to consider the cost of shipping when planning your business.
Dependable
Lastly, you want to choose a product that is reliable and consistent. This refers to both durability and quality. As mentioned above, shipping fragile items can complicate the shipping process. Products that are damaged in transit end up costing you money, cutting into your profits. Similarly, products that are inconsistent in terms of quality can lead to dissatisfied customers. This could force you to refund certain items and receive lower ratings online.
Product consistency is about more than just the product itself. This is also an issue where the wholesaler you choose becomes very important
Choosing a Wholesaler
The reliability of a wholesaler is one of the first things you should consider before buying anything. The wholesaler you choose is responsible for providing you with good, quality products that you will then sell. Partnering with an unreliable wholesaler can damage your business and reduce your profits. But, there are other factors to consider as well.
Inventory
This is why it’s important to figure out what to sell first. Once you know what you want to sell, you need to find a wholesaler that can supply you with the right inventory. They shouldn’t just have your preferred items in stock. Your wholesaler should be a reputable company, offer high-quality products, and have good customer service, too.
Pricing
Remember, your price point and profit margins are the keys to your business’ success. The price you pay when buying wholesale is essential in this regard. The less you pay, the better your price point will be.
Location
Lastly, you should also factor in the location of your wholesaler. If you are based in the United States, an American wholesaler will be able to offer faster, and cheaper, delivery of your products.
How to Buy Wholesale from Amazon
One last question frequently-asked question is, “Can you buy wholesale from Amazon?” And the answer is, yes. Amazon makes it easy to buy and sell products wholesale on its website. Plenty of companies sell wholesale on Amazon.
In fact, if you’re wondering how to buy wholesale without a business, this is one of the easiest solutions. Many Amazon wholesalers sell to charitable organizations who then donate their products, rather than resell them.
To learn about buying wholesale from Wholesale Sock Deals, read our FAQ page for more information.