The e-commerce business has the advantage of having access to large inventories and common merchandise. For this reason, some e-commerce stores have chosen to rely on wholesalers to ensure they have sufficient inventory.
If you are considering partnering with a wholesaler, you need to know the following.
Hows Do Wholesale Distributors Work?
Wholesaler distributors (also known as wholesalers) buy large quantities of merchandise directly from manufacturers and resell them to retailers and e-commerce companies.
Ways on How Wholesalers Can Support E-commerce Businesses
While wholesalers have traditionally worked with retailers in physical stores, the rapid growth of e-commerce has led to more and more small and medium-sized businesses going with wholesale distributors too. Here are some of the ways wholesalers can benefit their e-commerce business:
- You will have access to the items consistently.
Wholesalers receive discounts from suppliers for bulk purchases. You don’t have to worry too much about running out of bestsellers as we provide reliable streams and consistent product quantities.
- You will have access to items that you originally don’t have access to.
Unless you run a large company, it takes a lot of time and resources to create your own product. A wholesaler is required if the company cannot purchase directly from the supplier because the purchased quantity is too small to meet the supplier’s minimum order requirements.
- You will get items at better prices.
Even if you are a business owner who meets the supplier’s minimum order requirements, wholesalers can buy products in bulk and get better prices from their suppliers. Working with wholesalers, they may have a relationship that offers better low price discounts for high-quality products in your industry.
- You will have geographical access to the items.
Being not limited to suppliers in your area, wholesalers give you access to a wider range of products. The wholesale model gives you access to and selection of a wide range of new items if you want to increase your product inventory and SKU count. Wholesalers can help achieve these goals.
- You will get better quality control.
By running with a dependable wholesaler, you could display item quality control by monitoring how their merchandise is carried out with customers. If they get hold of too many bad opinions or complaints, you could make the choice to replace an exceptional wholesale distributor.
Most Common Challenges Business Face in Finding Wholesale Distributors
Wholesale is quite new to the e-commerce industry. Many wholesalers prefer to work in traditional retail stores that have existed for a long time, and they may sometimes be skeptical of working for an e-commerce company.
Here are some of the challenges faced by the e-commerce business when looking for a wholesaler:
- Competition Between Wholesalers
When you talk to an e-commerce brand that has experience dealing with wholesalers, some are said to be better than others. Finding a quality wholesaler to work with is important, but also difficult.
There is no wholesaler review site, so you need to ask for a reference or ask people in your network to find a reliable, high quality wholesaler.
- Most Wholesale Distributors Don’t Do Dropshipping
Many e-commerce businesses want their distributors to dropship, so they don’t need to have too much inventory. Unluckily, many wholesalers avoid drop shipping because it doesn’t fit their business model.
- Wholesale Distributors Are Often Fearful to Work With E-commerce Companies
Even with the rise of e-commerce, wholesalers are still doubtful about working with ecommerce companies. Some reasons include them having field sales representatives who apparently don’t want online businesses doing their job for them, suppliers not wanting their items listed on online stores, and them wanting product data, which go instead to the e-commerce business.
Ways to Find the Best Wholesale Distributor for your Business
Finding a wholesaler to work with may seem like a formidable job, but it doesn’t have to be. Here are some helpful tips in finding the right wholesaler for your e-commerce business.
- Ensure to contact the supplier first.
Before looking for a wholesaler, coordinate with the suppliera directly to see if a wholesale price is available. Usually there is a minimum order quantity. Therefore, if you are unable to meet their needs, consider working with a wholesaler.
- Request a list of wholesale distributors from the supplier.
Your product’s supplier is probably the best source of information about who the distributors and how reputable they are. Ask them for contact information so that you can contact them directly.
- Coordinate with each of these distributors.
Consult with the person in charge at each distributor to inquire about the minimum order quantity and wholesale unit price.
- Do extensive research on different B2B marketplaces.
B2B marketplaces such as Alibaba and eBay are great places to find sellers of all kinds of products. B2B e-commerce is a more time-consuming process, but it can bring significant business advantages.
- Research for wholesalers you can find online.
Sourcing process can be started with a quick search online. You can search for “wholesale” + product or niche keyword.
- Request for product samples.
Once you find a retailer to consider, get a sample of that product, inspect it, and test it yourself.
When used correctly, wholesalers offer significant benefits for growing an e-commerce business. Finding the right wholesaler can be a trial and error process, but it may be worth working with them. If you don’t want to work with a wholesaler, consider 3PL as your next best option.
Don’t hesitate to contact us for us to assist you with any of your 3PL inquiries.