Believe it or not, starting a wholesale supply business in 30 days is completely doable for many professionals. For the most part, this is due to the advantages provided by cloud-based, internet technologies, which can be seen most clearly in the modern practice of “dropshipping.” The tricky part is actually coming out of the process with a successful business with long term viability.
While it’s possible to build your wholesale supply business from the ground up utilizing traditional planning, as covered thoroughly in this useful Entrepreneur article, this is generally a much more involved process and will take you more time and cost more money. With the most innovative techniques in mind for new businesses, let’s go over how you can quickly and strategically build a viable wholesale supply company.
What is Dropshipping?
Dropshipping is a business model in which you partner with a manufacturer to supply a dedicated customer base with specific products. The manufacturer provides the fulfillment and delivery services, and you build the online store to interface with the customer, and handle B2C transactions.
Before you go hunting for manufacturers, you need to establish a certified business. You can apply for an Employer Identification Number (EIN) with the IRS, and it’s a good idea to have a resale certificate and state sales tax certificate on hand as well. Invest in an ecommerce platform in mind that you want to sell from. Software like Shopify and BigCommerce offer easy ways to build an ecommerce site, or you can build a custom site with help from independent developers and designers.
You’ll also have to figure out what to sell. Do you specialize in a given market, or sell many different types of discount goods? There are many niches to fill, and you have to figure out what you are good at, the products you’d like to sell, and the specific wholesale shipping supplies your business will be utilizing.
There are many ways to find manufacturers. You can search for them online, look them up in a paid directory, attend a tradeshow, or choose a product and phone the manufacturer directly. It is important to exercise care at this stage, as there are plenty of scammers out there. That’s why it pays to do your due diligence in scouting out legitimate businesses and manufacturers.
What do you intend to sell? Who do you intend to supply? These are important questions for your future, as they’ll determine where you are placing your focus and investments. Some wholesale suppliers sell directly to consumers, while others supply retail businesses and other businesses.
Keep in mind that dropshipping is a competitive and low-profit business initially. To be truly successful at starting up your business, you have to outcompete other drop-shippers by choosing winning products, offering excellent service, marketing and selling your products well, and fine-tuning your business for efficiency.
Thanks to strategic drop-shipping, you can set up a wholesale business pretty quickly without having to take a tremendous risk or spend a lot of money on warehousing, staff, and distribution equipment, among other things. However since there is a low barrier to entry, this a populous and competitive field, and you really have to be a good salesperson and marketer if you hope to compete. Whatever the case, good luck with your endeavor!
About the Author
Carl Turner is a freelance writer with experience in wholesale supply and logistics. Carl is proud to have gotten a couple of dropshipping projects off of the ground, and enjoys sharing his experience with readers.