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Six steps to start wholesaling

Six steps to start wholesaling



Wholesale can be a very effective way to rapidly grow your product business, but it needs careful management. In this blog I'll be giving you three reasons why you should consider wholesale, steps to get started and five top tips to make it a success.


What is wholesale and why should you consider it?


Wholesale is the process of selling your products at a reduced price (typically less than half of your retail price) to another retailer, who will then sell it on to their customers.


Because it requires you to sell to retailers at such a reduced price, you may be wondering why you would even consider wholesaling.


However, wholesale, when done correctly, can have a major impact on your business, and you should consider wholesale for the following three reasons.


  1. Wholesale orders can dramatically increase the volumes that are going through your business. Even a small boutique will place much bigger orders than a typical customer. This will allow you over time to get much better cost prices from your suppliers which will drive up the overall profitability of your business and make you more money.


  1. It gets your business name out there and will massively increase your brand awareness. Wholesaling your products will help get your name out in front of a new audience, and will help spread the word.


Choosing wholesale partners that are selling to your ideal customer is the perfect way for these customers to find out about your brand.


  1. Even though you are selling to retailers at a much lower cost that you could sell to your customers directly, once you sell those products to another retailer, you have completed the sale and do not have to do the actual selling yourself.


That’s why people accept the lower price - because it will give them a chunk of income without the work of marketing, managing and dispatching each individual order.


Getting started with wholesale


Many people end up dabbling in wholesale because they are approached by a boutique or local business about stocking their products. However, it's worth thinking about your wholesale strategy before you get approached, so that when you do, you are ready to go.


Six steps to get started


  1. Check your pricing. You absolutely need to make sure that you can support the lower prices required for wholesale before you can even make a start. Take your retail price and divide it by 2.4. How much money will you be making on each sale?


  1. Check that you have completed any legal requirements for your products to go on sale e.g. any testing or labeling that is needed.


  1. Make sure your labelling, packaging and branding is suitable and professional enough to be sold in a retail business.


  1. Check your website and social media - the stronger your online presence, the more confidence the retailers will have in working with you. If you don't have a website, consider creating even a simple one so that retailers can visit it to find out more about you online.


  1. Put together your approach documents, sometimes known as a buyer’s pack. These should include an approach letter, a simple catalogue with high quality, lifestyle photos, and a pricing list.


  1. Research the shops that you would most love to be stocked in, take the time to understand what exactly it is that you can offer them, and then just do it! Find out how they would prefer to be contacted (many boutiques will tell you on their website) and send them your information.



Top tips for wholesale success


Wholesale can be a very profitable part of your business when done right, but it needs careful management to make it work. Here are my top tips for a smooth process.


  1. Planning is key with wholesale, so give yourself enough time to get everything in place. Don’t try and rush it - even if it means taking a year to get all the elements in place.


  1. Always under promise and over deliver. That means, if you think you can get the stock to a retailer in 4 weeks, tell them it will be 6 weeks so you never have to let them down by delivering late.


  1. Do your research - no “Dear sir or madam” when you are reaching out to the shops you want to stock you. Finding out the name of the person who runs the business is not difficult - you can search their social media accounts or the about page of their website. Their name will be in there somewhere!



  1. Know what makes your brand special and practise how to communicate that. Shops are looking for what is new and exciting, and above all, what will make their customers buy. Make sure you are really clear about your own unique selling proposition (USP) so that the retailers you approach will understand what you are offering them.



  1. Can’t make your pricing work at wholesale? Resist the temptation to increase your prices for wholesale just to make the maths work. Instead, see where you can cut cost out of your product without affecting what makes it unique and special. For example, can you negotiate better prices from your suppliers, or source cheaper packaging?



Wholesale is a whole new world for many product businesses, but the rewards can be huge.  If you’re ready to make the jump, make sure you prepare carefully and give yourself time to maximise your chance of success.


Thank you Catherine for the great advice.


Catherine Erdly

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