In August 2018, the wholesale trade industry reached $642.7 billion for that one month.
Clearly buying wholesale product is a booming business in the United States.
If you are a small business, buying at wholesale is the simplest way that you can cut costs on buying stock. Read on to learn how and where to buy wholesale.
What is Buying at Wholesale?
When consumers purchase any new product in retail store or online, they pay one price. Buying at wholesale for your small business means that you pay a lower price because you are buying in bulk.
The price of a wholesale purchase will depend on the quantity you buy. You will get a far better price per item if you purchase 10,000 pairs of earbuds than if you order 1000.
That is called the price per unit. Usually, the more you buy the lower the price per unit.
There are several places for small businesses where to buy wholesale. Here are a few ways that you can get wholesale products to help you make better profits when you resell.
Buying at Wholesale From Manufacturers
Manufacturers are companies that make the products. Typically, they send their items to wholesalers who stock retailers for them.
Depending on the manufacturer. you may be able to buy directly from the manufacturer. But, not all manufacturers sell to small businesses directly. You will need to do research on each manufacturer you are interested in buying from.
Wholesale Purchases From Exclusive Distributors
An exclusive distributor is the only company that has the right to distribute a specific product. Many manufacturers make deals with exclusive distributors and only work with a single distributor.
These exclusive distributors might sell directly to retailers. Or they could also distribute the products to smaller wholesalers. If a certain manufacturer will not sell to you directly, you can contact their exclusive distributor to purchase products.
Buy Liquidated Stock
Another option is to purchase items from a liquidator’s website. Liquidators run online platforms that allow big retailers to sell unwanted items.
You can purchase either tested or untested truckloads of goods or buy them by the pallet. A live auction will allow you to purchase a wide variety of items either at a fixed price or sometimes, a negotiated price.
Liquidated stock comes in various conditions from “as new” to “slightly damaged” or “not working.”
This is a great option for startups who want to get stock but don’t have the revenue (yet) to make a big investment in product.
Here are the main types of liquidated stock.
Customer Returns
Every day, thousands of products ate returned to retailers both in store and online. Statutory consumer protection ensures that retailers accept merchandise within the stated return period window.
Customers return products for all sorts of reasons. It was an unwanted gift, it didn’t fit, they changed their mind or found it cheaper elsewhere.
This returned merchandise can often not be resold by the retailer, even if it is unused. So all these products end up taking up valuable shelf space in a store’s warehouse.
Often, stores sell their customer returns to online liquidators to recoup the financial loss due to the return and to make room in their warehouse.
Overstock and Closeouts
Most retailers would rather order too much stock than not enough. But when the when new versions are coming out, retailers are often left with too much extra product they can’t sell.
Closeouts also have too much product. Usually, it is due to the end of a specific season. For example, at the end of the holiday season, a store doesn’t need (and won’t be able to sell) thousands of boxes of Christmas lights.
To make room for new products, retailers need to get rid of their overstock. You can purchase overstock from various distributors and liquidators. This is another great way to get stock for your small business.
If a store is closing or going out of business, they will sell their products at rock-bottom prices to liquidators.
Find Wholesalers for Your Business
It can be tricky to find wholesale suppliers for your small business.
You could try attending trade shows. You could meet wholesalers there and see products in person.
Ask manufacturers for a list of its distributors and contact them. You can also do online searches for wholesalers in your area.
Don’t forget to talk to others in your industry. They might have connections or be willing to point you in the right direction.
Things to Consider when Choosing a Wholesaler
Take time to source the best wholesaler for your business, don’t just go with the first wholesaler you connect with.
Make sure you understand the price and any discounts you might qualify for. Ask questions to ensure you understand the shipping options and how much it will cost.
Look for wholesalers that are reputable and have been in business for a while. The last thing you want is a flyby company that leaves you with no stock without warning.
Take time to call their customer service line. You want to do business with a wholesaler that is easy to get a hold of and has excellent customer service. After all, you are their customer.
Final Thoughts on Buying Wholesale Products
Buying wholesale products makes financial sense for startups and small businesses. It allows your profit margins to grow and decreases your upfront expenditures.
Visit Buying Merchant to buy wholesale products that will cost you pennies on the dollar.