A wholesaler is a business that buys products from manufacturers and sells them to other businesses. The wholesaler doesn't operate a store; instead, they supply your small business with inventory that you sell to customers.
Whether you run a brick and mortar business or e-commerce store, wholesale distributors play an important role in connecting manufacturers and store owners.
Find the Right Small Business Wholesale Supplier
As a small business, you may work with one wholesale distributor or several. But finding the right one to partner with can be tricky. You'll need to find a wholesale distributor that:
- Connects you with the manufacturers and products your business needs
- Has prices you can afford
- Serves your geographic region
- Is reliable, trustworthy, and easy to work with
Before you can find the right wholesale company to work with, you need to know what products you are selling. Once you know what you're looking for, you can begin searching for the right wholesaler to supply your business.
1. Understand Your Industry's Distribution Channels
There are many ways a product can go from manufacturer to retailer. Not all wholesalers serve the same market. Understanding your industry's distribution channels and supply chain can help you find the right wholesale supplier for your retail or online business. Different types of wholesalers include:
- Manufacturer: For some products, you can buy directly from the manufacturer. Boutique stores generally buy from small (sometimes one person) manufacturers.
- Importer/Exclusive Distributor: A company might have the sole right to import and distribute a product in a certain country. Some may sell directly to retailers, others sell to smaller local wholesalers who in turn sell to stores.
- Wholesaler/Regional Distributor: There are usually regional wholesalers who take delivery of boxcar-sized lots and sell to local wholesalers, who then sell to small businesses.
- Jobbers: These individuals make daily deliveries to local grocers and retail brick-and-mortar stores.
Some retailers will move enough volume to bypass jobbers, or maybe in a smaller industry, importers sell directly to retailers. Each industry has its own unique distribution channels, which can then vary by product, region, or country.
When you first start, you'll be buying from the smaller wholesalers at higher prices. As your volume increases, you'll be able to get better pricing or move up the supply ladder to a bigger wholesaler.
2. Try the Manufacturer First
Paying wholesalers cuts into your profits. To remove middlemen from the equation, you can start at the source.
If you're selling branded items, go directly to the manufacturer of the product. They might sell to you depending on their minimum order requirements. If you're too small for them or they only sell through established distribution channels, ask them for a list of reputable distributors you can contact.
The fewer people you have to go through, the lower your cost will be, allowing you to be more competitive in the marketplace.
When you contact the manufacturer, request a sample of the product you intend to sell. This will allow you to look it over and inspect the quality to make sure it's something you want to sell.
3. Have a Productive First Contact With a Wholesale Supplier
Begin contacting wholesale distributors, either using the list you got from the manufacturer, phonebook listings, or a wholesale directory You want to find out:
- Their minimum order requirements
- Their wholesale unit prices
- The region they supply
You can make this initial contact by phone or email, then follow up by phone if you need more information or would like to move forward. To find the best possible match for your business, be honest about what you're looking for and don't try to sound bigger than you are.
Don't be afraid to let the people you talk to know you are doing research and looking at other competitors as well. This can help you get better prices, even if you are starting out small.
4. Get Specific in Online Searches
If you do an online search, don't just search for general wholesalers or distributors. Be sure to include keywords from your products or niche. Try product names, model numbers and brand names. If any of the potential distributors you find don't have an email address or phone number readily available, you could do a WHOIS search to find the website owner's contact information.
The more potential wholesalers you find, the better you'll be able to comparison shop and get a feel for what normal industry prices are, as well as get competitive quotes.
5. Look for Wholesale Lots on eBay
Since eBay mainly targets retail consumers, the wholesale options you'll find here are usually only suitable for very low volume retailers. But if you're just starting out, eBay might be the easy start you need to dip your toes into e-commerce.
It's also possible that the people who are selling direct to consumers on eBay also have a business-to-business side of their business as well. It's easy to make contact with them on eBay to find out if that's the case.
6. Check Major B2B Marketplaces
There are many large B2B marketplaces online where you can buy large lots of products at low prices. Alibaba.com is one of the largest B2B marketplaces of manufacturers, importers, and wholesale distributors. Other B2B marketplaces include:
- Global Sources (USA)
- Buyer Zone (USA)
- EC21 (Korea)
- EC Plaza (Korea)
- Busy Trade (Hong Kong)
Look for a marketplace that serves your country or region. There are also industry-specific B2B marketplaces; these can either serve a single country or a global population of retailers.
7. Join Industry Groups, Forums, and Other Professional Networks
More experienced small business owners in your industry or niche are often the best source of information about wholesalers. However, other retailers likely will not be eager to share supplier information with competitors. Invest time in networking to build the trust and connections that will help you find the best possible wholesale suppliers for your small business.
Participate in online forums which can be a great source of free information and help from other people with experience in your market or industry. You can also build your LinkedIn profile, subscribe to industry newsletters, and join your local Chamber of Commerce or small business networking groups to build your professional connections.
8. Subscribe to Your Industry's Trade Publications
Trade magazines are a wealth of information about businesses and relationships in your industry. Nearly every advertiser in the magazine will be a product manufacturer or distributor looking to reach you, and a single issue of a trade magazine can provide the names of dozens of wholesalers or small manufacturers.
In addition to magazines, subscribe to online newsletters and blogs. These are often the best way to keep up with daily or weekly industry news and updates.
9. Attend a Trade Show
Trade shows are one of the most powerful ways to build and grow your business. These events are designed for retailers to connect with distributors and manufacturers.
Trade shows allow you to meet and speak with dozens of wholesalers or manufacturers in a single day. These face-to-face conversations often avoid misinformation or communication difficulties that can occur when contacting people online.
The Trade Show News Network is the largest directory of trade shows online. You can search for a trade show by industry, date, city, state or country and/or event name.
10. Don't Be Afraid to Make a Mistake
Your first wholesale supplier may not be a vendor that you work with long term. Creating your perfect supply chain is an evolution involving a lot of trial and error.
Remember that all you need from your first supplier is a product that you can ship at a profit. It may not be the best wholesale price for you, but you can make changes as your business and professional network expand.
Your first goal is to ship a product. Then you can improve your bottom line by trying other wholesale suppliers as you continue to build and grow your business.