Part one of our series explored whether or not FBA sellers should explore wholesaling. Today’s post assumes you’ve decided to take that leap!
Before we get into the subject of wholesale buying for your business, I want to address a common misconception among folks new to wholesale. When I did an interview a few months ago on FBARadio with an FBA seller who was selling all wholesale merchandise at the time, the most asked question was, “How Do I Get Started?” The audience was amazed, because when the seller explained her processes; which included placing her repeat orders, having them shipped to her home, relabeling them and shipping them out to Amazon in the same boxes they came in, it sounded so much simpler than what they were doing. Most of them had been out every day in thrift and retail stores sourcing inventory for hours each day, loading it into their car, finding or purchasing boxes, removing price sticker labels and then fitting it into the right boxes to get it ready for UPS.
The wholesale method seemed ‘easy’ to our audience but they were missing a large piece. I have since worked with two clients to help them get started in wholesale and they have quickly found out that wholesale sourcing is not necessarily easier or less time consuming; it’s just that your time is spent differently. A lot of research goes into wholesale sourcing. You will be spending a lot of hours on your computer and on the phone (rather than in your car in traffic and stores, as with the more traditional sourcing you might be familiar with).
In my earlier article on this subject, I introduced a few sites where you can find wholesalers. Now I’d like to delve a little deeper into DOBA, Worldwide Brands and Alibaba. Remember, as we discuss these sites that these are large companies with large marketing budgets. You will not be the first, the one hundredth or even the one thousandth person discovering their sites. Each site will require a lot of hours digging for that deal that the other members haven’t found yet. And also keep in mind that wholesaling is not a one-and-done method. Even after all that work discovering that diamond product, eventually others will find it and you will need to move on. So remember this mantra, “Always Keep Sourcing!” Even when you are content with your product mix and sales, keep searching, because you should always have more products in the pipeline.
DOBA bills itself as a site for drop shippers and you can’t use drop shipping with FBA so you may wonder why it is here? I chose to include DOBA because I believe they can offer a route to finding true wholesalers. Many of the companies that offer drop shipping are, indeed, wholesalers. If you can find a promising product through their drop shipping offers, there is nothing to prevent you from contacting them to arrange a wholesale deal. DOBA offers a free 7 day trial. You must enter your credit card information to sign up for the trial and remember to cancel before the 7 days end or you will be charged $59.95 per month. They also have a yearly offer.
Worldwide Brands is the largest, longest lasting (1999) and most respected of the three companies I’ll be talking about. They offer resources for drop-shipping, light bulk wholesale (wholesale with lower minimum orders) and wholesale purchases. They currently list over 8.2 million products and the cost is a yearly fee of $299; this can be paid in 2 payments of $110 plus the down payment of $99).
Alibaba is a connector website. There is no membership necessary and it exists to help merchants connect with Asian manufacturers and wholesalers. I have several business associates who have made successful connections using this site and are very pleased as they have expanded their import business through those connections. My caution here is that I believe this site is best used by advanced sellers who have already gotten their feet wet with in-country wholesalers. Learning wholesale is one thing and learning to import is another skill-set entirely. I believe learning one at a time is the best course.
Now that we have covered the three businesses I mentioned in the last article, I am going to give you my recommendations and tell you how I found the wholesalers I work with today. First, my story. I found several of the wholesalers I work with today through selling their products in another way. Perhaps I purchased them off a retail store clearance rack, or I found them while doing a web search and was intrigued with the product. My eBay business, Kat’s Boutique, specializes in items invented by women and used by women, so my antennae are attuned to these type products wherever I see or hear of them, and I seek them out. Once I have the product in my hand, I use the label and the internet to find a place to buy. I just keep searching. Remember, these products are made to be sold and you want to buy them. It is a perfect match!
Another resource I have used successfully is Web Wholesaler Magazine. Free to peruse – it’s chock full of good information.
My best advice, after you have started watching and reading, as I mentioned above, is to attend a couple of trade shows. These can be very overwhelming so if you can’t get an experienced friend to act as a guide, or have time to fit in Lisa Suttora’s excellent course on wholesale and trade shows, then leave your wallet at home! You will need to be a registered business to attend a trade show. Each show has its own rules regarding what you’ll need to prove this, ranging from your business check book to just a business card. This website lists most of the larger gift shows and will give you a link to check out their requirements. Again I caution, take Lisa’s course before you go, or take an experienced person along as a guide. If you can’t do either of those, count on your first show strictly being a chance to look and learn.
Now, get out there and source! Oh, and please leave your favorite tip below for others to learn from!