Wholesale Guide: Start Selling Wholesale To Retail

As a retailer, you have to worry about a lot of factors on top of increasing sales. You need to consider branding, product innovation, design, marketing, and much more. By selling wholesale to retail, you can do away with a lot of those worries and focus only on growing your business.

In this article, we’ll talk about why selling wholesale to retailers can be such a smart business move. Then we’ll talk about how to start a wholesale business from scratch. Let’s get to it!

Why Sell Wholesale to Retailers

As a wholesaler, you usually deal with businesses that in turn sell your products to end customers. Those businesses often buy in bulk so they have enough inventory to meet demand during the short to medium term. If a product is popular, you can be certain that they’ll come back to you for further orders.

By selling wholesale to retail, you reap several advantages over dealing with end consumers directly. Those advantages include:

  • Branding is not as important since businesses might want to white label products on their end
  • You sell in bulk, which can provide you with much larger profit margins
  • Wholesale customers tend to make return purchases (as long as you offer them great prices)
  • You get to negotiate payment terms and shipping options on a customer-by-customer basis
  • Retail operations tend to have much bigger overheads

By selling wholesale to retail, you might not make a lot of sales each month. However, the sales that you do make will probably be of a significant magnitude. In any case, dealing with fewer customers means that you can devote more time to offering each of them the best possible experience.

How Do I Start a Wholesale Business?

You can’t start a wholesale business without products. If you’re already in the e-commerce space, then you probably have a decent stock of products or you know where to source them. However, you won’t be able to sell wholesale to retail at the same prices that a regular store would. That brings us to your first step.

Step 1: Calculate Your Wholesale Prices

We have a full guide on how to calculate wholesale prices from retail numbers. However, we can sum up the most important aspects of that guide in a few steps:

  • Look at what wholesale competitors are charging for the same or similar products
  • Gather customer feedback to see how you can differentiate your products
  • Check your production costs to see what is the bare minimum price you could charge
  • Settle on a price that’s between your production costs and the original retail price

Naturally, that’s a very boiled-down version of the process. The most important aspect of wholesale pricing is that you remain competitive with other businesses. You can do that by offering the same or lower prices, a better quality of product, or by being the sole provider for specific items.

By “production” costs, we mean how much you spend sourcing products, getting them to the location where you ship them from, and preparing them for retail customers. If you charge anything below that price for wholesale products, then you’ll operate at a loss.

Step 2: Approach Retail Stores and Develop a Marketing Plan

Selling wholesale to retailers will be a challenge at first. Most stores will have existing relationships with suppliers, which means they won’t find your business unless you approach them first. You’ll need to find potential retail business partners with a wholesale marketing plan.

We also have a full guide on how to approach retailers as a wholesaler. You should read the full guide, but the main takeaway is that there are three ways to approach retailers:

  • In-person meetings
  • Head-office meetings
  • Cold emails or mails

If you’re dealing with small retailer, approaching them in person is probably your best bet. That usually involves establishing contact by finding whomever’s in charge of purchasing, pitching your products, and arranging a meeting. During that meeting you’ll need to discuss prices and show off your products.

Dealing with head offices is somewhat similar, but they often represent a large group of retailers. That means you’ll need to pitch your business to multiple partners or managers who will decide whether or not to stock your products.

Finally, cold emailing or mailing can be a great way to establish contact with retailers if you can’t get a meeting in the books. For this process to work, you’ll want to make a list of all of the retailers that you want to do business with and find their contact information.

The more leads that you can collect, the better. Once you have contact details, you can send a personalized cold mail or email discussing your products and why you’re a good match with the retailer that you’re targeting. In most cases, you won’t get responses, but you just need one or two retailers to reply to get the ball moving with your store.

Step 3: Launch Your Wholesale Store

Selling wholesale products from home is 100% possible if you have the right e-commerce setup. With WordPress, you can use plugins such as WooCommerce to set up online retail stores and grow your business as much as possible. Here’s a quick example of a regular WooCommerce store:

An example of an online store
An example of a regular WooCommerce Store

The issue with WooCommerce (and most other WordPress e-commerce plugins) is that they’re not geared for wholesaling operations. For selling wholesale to retailers, you’ll need a different set of tools, such as Wholesale Suite:

Selling wholesale to retail
Wholesale Suite makes a regular WooCommerce store a fully-functioning wholesale store.

Wholesale Suite is a collection of plugins that add new wholesale functionality to WooCommerce. Using Wholesale Suite, you’ll be able to:

  • Create custom wholesale user roles
  • Set unique wholesale prices for each product (and for each user role)
  • Design wholesale order pages
  • Manage user registration for wholesale clients

If you plan on selling wholesale to retailers as a serious project, you’ll want to launch an online store to help you process sales and manage orders. With Wholesale Suite, you’ll be able to let retailers make orders whenever they want so you can focus on other aspects of running the business.

Conclusion

Selling wholesale to retailers can be a very profitable endeavor. Wholesale businesses have a much lower overhead than retail operations. Moreover, you don’t need as many customers or to make as many sales to turn a good profit.

If you want to sell wholesale to retailers, here are the three steps to getting started:

  1. Calculate your wholesale prices.
  2. Approach retail stores and develop a marketing plan.
  3. Launch your wholesale store.

Do you have any questions about selling wholesale to retailers? Let’s talk about them in the comments section below!

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