Wholesale e-commerce sourcing is a tried-and-true solution to the constant e-commerce challenges of stocking unique inventory and increasing profit margins. It avoids the pressure of in-house production for business owners while allowing them to remain in control of their products, shipping, and branding. What exactly is wholesale sourcing? It’s when a retail business buys goods in large quantities from manufacturers or distributors at a low price, stores them (either in warehouses or elsewhere, depending on amount), and then resells them to a consumer.
The differences in wholesale and retail business operations complement one another and allow for a mutually-beneficial flow of goods. Wholesale manufacturers and distributors are B2B companies that have a much lower price per unit than their B2C retail counterparts. While retailers can handle a small number of many different products, wholesale manufacturers and distributors typically handle large quantities of a small subset of specialized goods.
How to Buy Wholesale?
Are you considering the idea of wholesale sourcing? Make sure to do your homework before making any major purchases. There’s a lot to consider here. A wholesale strategy is grounded in data analysis and understanding of market trends. Start by studying bestselling products on other online marketplaces (Amazon has a hugely helpful best sellers page). Then examine sales data from your store and your competitors, look at global and industry-specific market trends, and narrow down the scope of potential products to source.
It might not sound like the most fun, but you’ll be happy you did it when the sales start rolling in.
Another consideration? The operational and logistical challenges that come with buying products wholesale. We highly recommend sorting this one out before you buy anything in bulk. Wholesale sourcing is very different from its newer dropshipping counterpart in that the retailer is responsible for storing and managing inventory once stock is purchased.
In other words, if you buy 3,000 dog chew toys for your organic pet supply store, then you’d best have a secure location to store 3,000 dog chew toys.
Wholesale sourcing dodges the biggest drop-shipping bullet in that it allows a retailer to retain control over packaging, shipping, branding, and logistics. For unique or niche brands, all of those elements of product delivery can make or break their sales numbers.
Where to Find Wholesale Suppliers & Distributors?
If you don’t know where to start, don’t worry. We’ve got you covered.
You can consider buying wholesale products directly from a manufacturer, but there’s way more risk involved in that process. The success of your e-commerce store depends on a stable relationship with your wholesaler or distributor and well-made goods; it can be harder to vet reliable and trustworthy manufacturers with little experience. Best to leave that up to distributors.
Distributors do the heavy lifting for you on that front, and they can be a much more reliable way of sourcing wholesale products. Distributors are commission-based middlemen who find manufacturers and connect them with retailers looking to source products. They’re buying and selling goods only to and from businesses, and it’s their role that has made the wholesale sourcing process so seamless for manufacturers and retailers.