Wholesale Tips

Wholesale Tips for Retailers

Deciding What to Sell

Investigate sources of products before committing to starting a wholesale to retail business. Choosing the right products can determine the success of your business. Make sure you can obtain these products at a low cost and there is adequate demand so you have an opportunity to make money from the sale.

One consideration in choosing products is to sell products you have an interest in. For example, if you are really into cell phones and technology, then consider selling mobile cellular and travel accessories. If you are a big sports fan, consider selling sports clothing and equipment. If you are interested in the genre where you are selling, then it will be more likely that you will have the enthusiasm and drive to sell them effectively.

It’s good to do a lot of research before you launch, as that will determine the best niche for your business, and what ultimately, will be the most profitable.

Drop-Ship or Self-Ship?

Deciding which delivery method you choose for your business is an important decision. One of the most popular ways to sell wholesale products is by drop shipping. This method requires you to do the advertising to sell the products but allows you to have less responsibility for the shipping. The seller makes the sale and then notifies the distributor to ship the item to a customer’s address. The distributor ships the item to the customer, using the seller’s actual address. This allows sellers to offer a variety of merchandise without having to maintain their own warehouse. Some wholesalers may not use this arrangement, which means you may have to handle the shipping yourself.

Find a Wholesale Supplier

You’ve decided on the types of products you want to sell and how you would like to ship them; now it is time to find those products. Here is a list of wholesale distributors that offer a wide range of products that you can choose from:

Legal Considerations for Your Business

When you start a wholesale-to-retail business, you will need to obtain a federal tax identification number. You can apply for one on the internet on the IRS website. Using a business tax ID makes it possible for you to open a bank account in your business’s name and it makes it much easier to separate your business income and personal income at tax time.

Another legal consideration is the collection of sales tax and who is responsible for paying it – the wholesaler, the retailer, or the customer. Each state has different rules around tax collection, so there is no easy answer to this question. Some states may require the wholesaler to collect sales tax, while other states may require the retailer to collect the tax. Study the laws for your state and the states you may be doing business in to get guidance; a tax accountant or attorney may also add clarity to the process.


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