How to Choose Wholesale Suppliers – A Beginner’s Guide
Small business owners need to have quality inventory, but they need to remember that they are a small company without the deep pockets of larger sellers. Working with wholesale suppliers can help to make getting the right inventory for your business much cheaper, as well as more efficient. Choosing the right wholesale suppliers to use is important, but those who are new to buying through wholesalers may not know where to start. The information in this short guide should help to put you on the right track.
Choosing the Best Wholesale Supplier
The first step when you are looking for wholesale suppliers is to know what types of items you need to have in your inventory. Make a list of the items that you sell or that you want to sell. Order the list with the items on the top being the most important, which are usually the ones that you will sell the most of or that can provide you with a greater profit when you sell them. Once you have a list of the types of products you are selling, you can then start to look through the wholesale suppliers out there. Sort through the ones that offer the types of products that you need, and compile those companies into a list.
What Do You Need to Know About Wholesale Suppliers
Now that you have your list of companies, you can start to learn more about those wholesale suppliers. Some of the things you will want to learn about those companies include just how often they tend to get in new merchandise, the types of brands and retailers they utilize for their inventory, and the overall quality of the merchandise received.
When you are buying wholesale, the condition of the goods can vary, and you want to be sure these wholesale suppliers are upfront with you about the condition. Are you buying new or like new items, perhaps returns? Are you buying refurbished merchandise? Are you buying items that come “as is” with no guarantee of them working or being salable?
Depending on the type of business you have, the condition might not matter as much. For example, if you buy items that aren’t working and then fix them or sell them for parts, it is not as important. However, if you want to sell the items at a higher profit that are usable as soon as the customer receives them, you want to make sure the wholesale supplier can provide those types of items.
How Much Should You Pay for Wholesale Items?
You will also want to look at the prices when you are comparing the companies. For the most part, you will find that the prices of pallets of similar types of goods tend to be similar from one company to another. Still, they will have variations, and you want to know whether the prices being charged for the goods are too high to allow you to make the type of profit you would like.
In addition, you need to check out any other costs associated with the company that could increase the overall cost of the goods. This includes shipping, for example. Compare the prices alongside the quality of the merchandise you are buying to make it easier to find wholesale suppliers that can provide you with the best value.
How Can the Wholesale Companies Help You?
What type of customer service policies do the companies have? You need to make sure that you are choosing companies that can listen to your questions and concerns and provide solutions. The policies should be clear, and if they aren’t, the customer service should be able to explain the ins and outs of using their service to you. For example, if they are not clear on their shipping policies and how long it will take to ship a pallet, this is something you will want to ask about. After all, you want to receive your goods as quickly as possible.
The following is a list from MrMantality.com of good questions to ask the supplier, as well as yourself, when getting started:
QUESTIONS TO ASK YOURSELF AND POTENTIAL SUPPLIERS
Do they dropship and what’s the turnaround time? Dropshipping in the early stages is always a good idea to get a feel for how well the products do. Then you can start to stock the good sellers.
What’s their website like and will it be easy to extract product images and product descriptions? It can be a real time saver if they have all the digital assets in place when it comes time to list your products.
What do their blog and social media profiles like? This will give you an idea of how often they post new products and can help you with buying decisions for future orders.
Do they offer 30 day credit terms and what’s needed? Some suppliers need 6 months or more of solid trading before offering these.
Do they offer any sort of rewards for purchases?
Do they sell direct to the customer via their own retail website? While not uncommon, this will mean you’ll be competing directly with them for sales.
Ask about their returns policy for damaged units and DOA etc? This can be very important and you want a supplier that will step in and cover some of the costs associated with reverse logistics because you can almost guarantee saying goodbye to any profit if there’s a problem with a product, and it needs to be collected, returned to supplier then re-shipped to customer.
What is their average turnaround time for orders?
Will they help out with shipping charges? Ask if you can get an order discount when an order is over a certain value.
Does the supplier or distributor list their retailers in a stockists section on their website and do they help promote their retailers? There’s an SEO benefit by having your logo and website linked to from a supplier.
The Pros and Cons for Wholesalers
Now that you have more information about the wholesale suppliers that you have put on your list, it is time to make a list of pros and cons for each of them. Consider all the factors that we’ve already discussed, as well as anything else that might be important to you. For example, you might want to choose a supplier that is in your country. This generally means the shipping will be less costly, and that can get the items to your location faster.
You can and should be critical when you are creating your list of pros and cons. You want to eliminate the companies that simply do not have what you need. Having a streamlined group of suppliers that you can use is better than having too many.
Using More than One Wholesale Supplier
Do not make the mistake of putting all your eggs in one basket. Streamlining, as mentioned, is good. However, you need to have several high-quality suppliers that can provide you with the types of goods you will be selling. What would you do if you had only one wholesale supplier and they suddenly did not have the type of merchandise that you need? You would have to start the entire process of looking for suppliers over again. It is better to have multiple suppliers at once, and then you can choose the ones to buy from that have the products you need at the time.
It might seem like there is a lot of work that goes into finding the right wholesale suppliers for your business. It does take some time and effort on your part, certainly. However, when you have several great suppliers that have the types of items you need at great prices, it makes running other aspects of your business so much easier. It also means you have a better chance of turning a profit.
Kersten works as a sales representative for Direct Liquidation helping businesses to source liquidation inventory from the world’s top retailers and manufacturers. Kersten works with single pallet, LTL and truckload buyers hand in hand to ensure their businesses stay stocked up with the highest quality merchandise year round.
Schedule a sales callback with Kersten right now and find out how he can help your business profit with liquidation merchandise.