Forum Moderators: buckworks
Have any retailers done well wholesaling?
I argued that the profit margin would end up too small, but they said I should be able to negotiate a lower price with my suppliers once my volume goes up due to the wholesaling.
This is not always the case in some sectors selling wholesale is discourged and not well taken so this needs to be addressed to the suppliers before jumping in the fray. I would find what volume I need to get to for a better discount, how shipping would be done fixed or cost based on weight etc.
I am wholesaling right now it is tough my market is saturated and it is tough, our store is keeping us going as we sell wholeale from the store.
Make sure you cross all the dots before jumping into the market. It can be very rewarding and profitable but it takes determination and lots of hard work.
Make sure you cross all the dots before jumping into the market. It can be very rewarding and profitable but it takes determination and lots of hard work.
What kinds of things would I have to consider for wholesale selling that I'm not already considering in order to sell at retail?
The internet store should be run just as you do your retail outlet so plan on the additional workload in advance.
One of the biggest problems in the internet business is sometimes a site does much better than expected and the owner is caught short thus poor customer service and word of mouth is the best advertisment a wholesale business can get.
I, too, have tossed around the idea - things I've contemplated if/when we start wholesaling:
1. Credit applications (industry references, etc) and legal agreements entailed therein
2. Minimum order requirements and/or pricing tiers
3. Collections/billing/customer service department
I've heard many, many wholesalers complain about billing issues. When wholesaling to a reseller who is on credit, they run into the whole "you'll get paid when *I* get paid" scenario. These are "smart" business people, multi-million dollar businesses, having cashflow issues because they wholesale and the average account is 60days outstanding. If/when I start to wholesale, everything will be paid upfront - I've heard too many cautionary tales.
If a retailer who could otherwise procure products from your supplier directly buys from you out of a lack of info, or because they are made to believe you are selling at true wholesale prices, this could lead to problems down the road.
wholesaling unless you are the manufactureris not actually correct. In my sector most not all manufacturers sell to a distrubiting comany were I purchase from them. I would have to buy 10-20k from the manufacturer to qualify and having 60 different manufacturers this in not possible at this time. This is not the ccase with all manufacturers as we do buy directly from some, but the majority do not sell but to a distrubitor.
Tonearm sector may be different and he may buy directly from a manufacturer. If he would clarify how he gets his goods this may help with the discussion on the subject.
And I am glad they do so. My experience with distributors has been less then satisfactory. The customer service has never been good, product knowledge very poor, and I'm assuming supply/shipping problem would abound. Just the opposite with manufacturers.
I seem to be getting them from wholesalersYour going to be doing the exact same thing I am doing. Your buying wholesale price from there "distributors" and either have a discount from the distributors and mark them up to the accepted retail price.
On your web you will be selling on the wholesale price of the product and using your discount to make money. This is what I am doing except I am doing it in m retail store as well.
It will work but you need to see what volume you need to get to to qualify for deeper discounts as well as making sure this doesn't rub some of your suppliers the wrong way.
