The economy has bounced back in many ways, but plenty of people still experience a lot of stress around their finances. It’s one key reason why people consider side hustles. It’s an avenue for bringing in some extra income.
One of the more popular choices for a side hustle is e-commerce sales. Most e-commerce businesses start their lives selling direct-to-consumers. Even so, that’s not the only option. You can sell wholesale to retailers as well.
Not sure how you become a wholesaler? Keep reading for some key tips about setting up your wholesale business.
Pick Your Niche
You can wholesale anything from clothing and vitamins to party supplies and cabinets. Effective wholesaling depends, at least in part, on working inside a niche. For example, if you specialize in beauty supplies, you can offer it as a private label brand to retailers.
In most cases, you want a niche closely related to or identical to a current niche in which you sell.
You have a couple of options for setting up an ecommerce store for your wholesale operation. Option one is setting up a new, dedicated store for wholesaling.
This approach lets you freshen up or separate your brands. It may also let you take advantage of new ordering software, such as ordrtakr.co.
Your other main option is adding wholesale options to an existing ecommerce store. This can simplify the process as you expand the offerings on an existing site.
You will also want a line sheet for your business. A line sheet contains images, details, options, and pricing for the products you offer. You’ll want a digital copy available you can email retailers, as well as physical copies you can hand out to potential buyers.
Pricing and Payment Terms
You should give some thought to your pricing and your payment terms. As a rule, retailers expect a significant discount from the expected retail price. The normal discount on wholesale items is around 50 percent.
Retailers also typically expect that you’ll offer them some kind of net payment terms. Net payment terms are the amount of time you give a buyer to actually provide payment on an order.
So, for example, net 30 terms give the buyer 30 days to pay. Net 60 terms provide 60 days. Longer net payment terms can make you more attractive to retailers, but it means you must float the costs for longer.
Sell Wholesale and Prosper
Some ecommerce business owners balk a little at the suggestion that they sell wholesale. They think of wholesaling as an either-or option. Either you sell your products directly to consumers or you switch over and make wholesale to retailers your entire business. In reality, you can still do both.
Wholesaling provides a potential new revenue channel for your business. It doesn’t replace your existing business activities. Bringing in new revenue through wholesale channels can also help you solidify your business’s finances.
Looking for more sales options for your business? Check out some of the other posts in our business section.