Imagine a world where businesses purchased items and then turned around and sold them to customers for the same price. Customers would appreciate this model, but it would absolutely destroy the businesses involved. You simply can’t afford to pay the expenses associated with running a business unless you’re paying less for your products than what you’re charging. The bigger the margin between the 2 transactions, the happier the business owner.
Given this fact, it’s essential for you to find reputable small business wholesale suppliers to work with. These wholesale vendors are your direct source for the prices you need and will also improve your operational efficiency.
Wholesalers purchase items in bulk, but they usually don’t have their own stores. They are merely the conduit for other businesses, which then serve as the customer-facing point of the supply chain.
Buying wholesale is often confused with drop-shipping, so let’s quickly define the 2 practices. When you purchase items from small business wholesale suppliers, those items are then delivered to you. So the downside of wholesale buying is that you need to make room for inventory and store it yourself prior to selling it.
With the dropship model, you never receive any products. They remain with the supplier until an order is placed by 1 of your customers, at which point you just pass the order along to the supplier. The product is shipped directly from the supplier to the customer, as though it came from you.
There’s less risk involved with drop-shipping, as you don’t have to store inventory and you won’t be on the hook if it doesn’t sell as briskly as you’d hoped. But you also won’t make as much money per sale because the supplier will charge you more for all the additional services provided. Additionally, it can be risky to have a third party handle your shipping.
There are plenty of reasons why so many entrepreneurs seek out wholesale vendors. Aside from the per-unit savings and ability to control the shipping process, purchasing wholesale also presents other perks for your business. Here are some of the primary benefits:
If you want to beat out the competition, you need more than good prices. You also need to offer the selection of products customers are seeking. Wholesale is a prime way to connect with these products.
It would take nearly all your available time to manage relationships with dozens of manufacturers. When you connect with a small business wholesale supplier, that effort is consolidated. And many systems allow you to automate the ordering process so that you never run too low on important items.
When products don’t sell like you hoped, there aren’t major issues since you’re not the manufacturer. But when sales are swift, you can easily dial up more orders and make sure that you’re ready to meet the demand.
Just because the wholesale model can be effective doesn’t mean that every supplier can deliver those benefits for your business. You have a lot of work to do before you can start enjoying the time-saving benefits of the system.
Start by talking to other small businesses in your network. Find out which suppliers get high marks and which suppliers are on the naughty list. Use these inquiries to also learn more about what red flags to look for as you vet possible partners in the future.
You can also attend trade shows where wholesalers are exhibiting. There are few things in life more fulfilling than walking down an aisle at the trade show and talking with dozens of wholesale vendors in such a concentrated area. Also, if your industry has a trade magazine, subscribe to it and look for lists of wholesalers.
Following these initial inquiries, it’s time to roll up your sleeves and really dive into the selection process. Here are some of the major factors that will guide your decision:
Obviously, this is 1 of the quickest ways to rule out a possible supplier. Make sure they have the products you need at a price that works with your budget.
You are putting your reputation on the line any time you’re working with a supplier. So make sure that the wholesale vendor is dependable and will back you up any time issues arise.
This is where you need to find out if they service your area of the country, have compatible requirements for minimum orders, and other factors that will quickly determine if there is even a chance of the partnership working out.
Entrepreneurs are no stranger to risks. But we also need to trust our intuition and try to avoid troubling situations. So trust your gut here, and don’t enter into a partnership that doesn’t feel good.
Finding reliable suppliers can open a whole new world of opportunities for your business. And as long as you take your time and make deliberate decisions throughout the process, you’ll undoubtedly connect with some amazing partners who can help you take your business to the next level!