Selecting the right wholesale supplier for your online store is definitely a critical business decision, which can affect your online store’s ability to compete on price, deliver products to customers on time, offer a good product selection to satisfy customer demands, and finally, determine your profit margins.
Or in other words, no eCommerce business is greater than the wholesaler they work with because the wholesaler is the one that supplies the goods and dictates the prices.
For that reason, selecting the right wholesale supplier is never an easy task. So, when you find yourself in the situation where you need to decide with which B2B wholesale marketplace you should develop a wholesale relationship, it is essential to consider factors like product portfolio, prices, customer service, and reliability before you enter any type of collaboration.
In this article, we’ll cover the essential things you need to know when choosing a wholesale supplier and partner to distinguish yourself from the manifold online entrepreneurs and run your business smoothly.
Understanding The Wholesale Industry
To begin with, first, you need to understand that the whole wholesale industry is enormous, with the fifty largest distributors contributing for only about 25 percent of the industry revenue, out of 408,000 wholesale providers in the US, with combined annual sales of approximately $8.7 trillion.
The wholesale industry serves a wide variety of industries, including food and beverage, apparel, medical and electronic goods, toys, just to name a few. So given the fragmented nature of wholesalers, it is crucial for you to know the industry of interest and do thorough research to weed out the wholesalers who don’t pass your initial filters.
Your Company’s Business Profile
In most instances, your relationship with the wholesaler of your choosing will be partly determined by your company’s business profile and the size of your business, as this can significantly influence pricing and other essential aspects for your business.
For example, if you are a relatively big online retailer with a large volume turnaround of goods, you can determine and secure the price of the goods based on your buy-in volume.
On the other hand, if you are a small online business and unable to purchase goods in high volumes, it may be inevitable to strengthen your relationship with the wholesaler over the long term (usually by signing a contract or agreement) and help yourself command lower prices on the desired products.
Nevertheless, many wholesalers place too much emphasis on their high-end clients, so make sure that you won’t get lost in the shuffle if you decide to work with a partner that has too much work on their plate.
To avoid this, you should always go with a wholesaler that delivers personalized attention, has a fantastic reputation in the industry based on references and testimonials, and can provide a transparent volume discount pricing plan so you can plan for the future by getting more significant discounts as your online business grows.
Top Criteria For Choosing A Wholesale Supplier
1. Product Offerings
Clearly, it is important to consider if the supplier has the products and brands you want to work with. Work with a wholesaler with a clear product catalog that is easy to search through and navigate and is full of product details to make the purchasing process as simple as possible.
In addition, check whether the supplier offers goods that they don’t currently have on stock but might provide at a later date, do they have exclusive access to certain key products that might differentiate you from other stores from your industry, and how consistently their products are available so that you have inventory at all times.
Prices shouldn’t always be determined solely by volume. To get the best prices, look into a wide variety of wholesale suppliers, as there might be substantial price differences based on the supplier’s relationship with manufacturers, shipping distances, and even currency exchange rates based on the supplier’s geographical location.
3. Reliable Shipping
Even if you secure the best prices with a given wholesaler, this can mean nothing if the products are delivered late or not delivered at all.
Essentially, working with an unreliable supplier will reflect poorly on your online store; it could mean significant losses for you and even risking going out of business. To avoid this, always go with a supplier with a knowledge of your industry’s shipping needs, one that offers product tracking and automated shipping alerts to their clients.
The bottom line, you should always go with a wholesale partner that will positively impact your online business and provide you with the proper selection of products for your clients. At the same time, the chosen supplier needs to offer competitive prices and be a business partner you can always rely on.
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I am Adeyemi Adetilewa, a media consultant, entrepreneur, husband, and father. Founder and Editor-In-Chief of Ideas Plus Business Magazine, online business resources for entrepreneurs. I help brands share unique and impactful stories through the use of public relations, advertising, and online marketing. My work has been featured on the Huffington Post, Thrive Global, Addicted2Success, Hackernoon, The Good Men Project, and other publications.