Wholesale Secrets Revealed - the Holy Grail of Wholesale!

De BISAWiki

Like the legendary look for the Holy Grail, the cup that Jesus drank from in the Final Supper, the same "holy crusade" goes on these days by veteran and newly anointed business enterprise owners for the ideal mistine, surplus, and drop-shipping resource. They think that divine intervention will lead them to suppliers that may defeat the financial laws of "supply and demand."

You will find additional than a number of individuals who attempt to create an enterprise based on the weak premise that they may able to "score" in demand retail items for their new small business, or auction, at either beneath wholesale prices, or "pennies on the wholesale dollar."

Trying to ride the wave of well-known retail items brings out the greed monster in all of us. Pursuing the "deal in the century" has lead some aspiring enterprise owners to risk their start-up capital on fraudulent bargains and provides.

In this post I desire to talk about three on the more sought following sources of solution provide, and also the "Pros & Cons" of each. I also would like to shed a little light on some of your misconceptions people might have about buying "products for resale." The reality is that not every solution will be available through wholesale, surplus, and drop-shipping venues.

Wholesalers: Typically, one with the better places to purchase items for your new found venture. Most true wholesalers will require that you have a "Certificate Of Resale" before you can purchase from them. A Certificate Of Resale, or "Tax & Use Certificate," is not hard to obtain, and costs anywhere from five to twenty dollars depending around the state you live in.

Some states do not require that you even have one. You can obtain the certificate from your State Department of Revenue. For extra information about sales and use tax, the websites Salestaxinstitute.com and Businessnameusa.com can provide you with further information about resale certificates and enterprise licenses.

Depending on your states procedure, once you fill out the paperwork you can get your "Certificate Of Resale" number the same day. You do not have to incorporate in order to obtain a certificate. You need to be a Sole Proprietor (at the very least) and have an address where you plan to conduct company. Once you have your number you will be able to open a small business checking account at most local banks. Most do not require more than some hundred dollars to get started. Wholesalers will require a minimum purchase price that will range anywhere from 100 to 1000 dollars.

A true wholesaler is usually one step away from the original source in the product. For instance, a manufacturer produces blue widgets and wants to get their product into the marketplace. They will then employ a sales representative to get the product into the market, or they may assign a wholesale distributor the exclusive rights to carry and sell their item line. Some companies are import wholesalers. While they do not necessarily manufacture a product, they are going to import solutions from manufacturers in the United States, and from countries like China. A great example of such an importer/wholesaler is the Bnfusa.com:

You'll find a number of ways to find wholesale solutions. Just about every solution that is in the distribution chain will usually have a dedicated trade association, organization, or trade publication attached to it. You can find such trade information with the help in the following directory information at the National Association Of Wholesale Distributors, NAW.org. Go to the "About NAW" section at the top on the website and then to the "Member Associations" section. There you will find wholesale associations members for just about every product that has a retail presence.

From Advertising to Woodworking. You should be able to solicit them for wholesalers within a particular industry. If you desire to purchase their membership list (separate from the association listings), you will have to get in touch with them to check their current rates. Other good sources are:

Encyclopedia Of Associations By: The Gale Group

The Encyclopedia Of Associations lists over 100,000 different nonprofit American organizations. If you cannot find what you are looking for from the National Association Of Wholesale Distributors in terms of trade associations, then this is the directory for you. However, you will have to go to your library to find this research gem. You can usually find it in the reference section of any large University, or Public Library.

Publist.com. In addition to trade associations, trade magazines are another good source. Publist.com allows you to: "Search our database of over 150,000 magazines, journals, newsletters, & other periodicals.

Find FREE in-depth information on familiar and hard-to-find publications from around the world, representing thousands of topics." Tradepub.com allows you to subscribe to trade periodicals from their web site for FREE! No hidden trial offers to qualify.

ThomasRegional.com. If you are looking for industrial item manufacturers, then this is the directory for you. The Thomas Regional directory will give you access to services from over "550,000 industrial distributors, manufacturers, and service companies."

The Thomas Regional will help you find suppliers in your own state or region. Registration is required, but you can use the directory for FREE! Other free online sources of wholesale information and provides are: Wholesalecentral.com, Wholesalegopher.com, Bizbb.com, Wholesalegopher.com.

PROS AND CONS OF WHOLESALE SUPPLIERS:

Wholesale is the backbone of item supply for any type of new business enterprise venture. Large and small wholesalers are usually one step away from the manufacturer. They have the advantage of buying large quantities, and, depending on the type of merchandise, are able to pass along savings to those who are looking for "products for resale." With wholesalers (in most cases) you can be assured of purchasing new solution. I can't think of too many "cons" when dealing with wholesalers--other than pricing. There might be products that could be too expensive to sell in the eBay auction marketplace. Remember, true wholesalers will require that you have a Certificate Of Resale in order to purchase from them.

Surplus & Salvage Merchandise: Another sought immediately after source of provide is retail surplus, closeout, overstock, liquidated, and salvage merchandise. Surplus dealers, and brokers, purchase shelf-pulled, returned, overstock, closeout, liquidated, and salvage merchandise from manufacturers, retail stores, reclamation centers, bankruptcy sales, and just about any small business who has slow moving or salvage merchandise.

Surplus dealers buy these obsolete products in large quantities, and then resell them to just about anyone who wants them for their eBay Auction, Flea Market, Dollar Store, or Retail Store outlet. One on the largest trade associations for the surplus industry is the International Marketing Association Of Surplus Dealers, Surplus.net. You can find dealers throughout the United States.

Other sources of finding Surplus, Salvage, Closeout, and Liquidated merchandise include the following: Closeoutcentral.com, Liquidation.com, CWSMarketing.com, Commoditysurplus.com, and National Retail Equipment Liquidators (Nrel.com).

PROS AND CONS Of the SURPLUS & SALVAGE SUPPLIERS:

The "Pros" on the Surplus & Salvage merchandise is that they can offer you a variety of products at beneath wholesale costs. However you "market your merchandise," you should be able to find a item, or price, that will fit into any enterprise advertising model. In most cases, you do not need a "Certificate Of Resale" to buy products from Surplus & Salvage Dealers and brokers.

The downside is that you have to do some investigative work. Some dealers will want you to buy merchandise in quantity (a pallet minimum, truckload preferred) and you have to visit the company you are buying from to make sure that the item is, as advertised. Also, much more than a few S&S dealers want payment in the form of wire transfer which can be very risky. Also, dealers and brokers will sometimes misrepresent the quality of the merchandise they are are selling. Before you consider doing any business with a surplus dealer, or broker, please use Google or your favorite search engine and type in: "The Ten Tenets From the Retail Surplus And Salvage Small business."

Drop-Shipping: Supposedly the right small business model. No inventory, no trips to the post office or UPS. You just set up shop, take the order, pass it along to the wholesale drop-shipping company and they send it out for you. Some drop-ship distributors will even send you ad copy and pictures to help you advertise their merchandise. They can even put your return address on the package! A lot of Retail Catalog companies use drop-shippers as their means of supply.

PROS AND CONS OF DROP-SHIPPING:

There is one obvious advantage to drop-shipping. It is basically a "product less" venture. No need to tie up your money in inventory. Drop-Shipping can fit into any business enterprise model, or advertising method you happen to use. However, if you are an eBay Auction seller you might would like to rethink that position.

Finding a drop-shipping company which can deliver on a consistent basis can be tough. Drop-Shipping companies have been known to run out of merchandise. If they happen to run out in the product you are auctioning, asking buyers to wait on their product because it is "back-ordered," does not inspire confidence.

Your negative feedback rating can pile up real quick. The other problem is expense. Some drop-shippers require a sign-up, or "entry fee" before you even start marketing their solutions. You might also have to pay for support materials, such as pictures and advertisement brochures for the solution you choose to sell.

In addition, when you sell a product from a drop-shipping distributor there are processing fees that have to be paid, in order to get the solution out the door and in the hands of your customer. That price can range anywhere from 5.00 to 10.00 dollars and up depending on the item. After eBay and drop-shipping fees, you can wind up losing money, or at best, breaking even. Bottom-line, drop-shipping and auction selling don't mix. The best bet for any auction venture is to "own what you sell."

EVERYTHING CAN BE HAD FOR A PRICE-BUT THERE IS A PRICE TO PAY FOR EVERYTHING!

Now that we have reviewed the "big three" let me put them into perspective. There are actually goods that could be obtained through a few of featured provide chains, and then you can find products that will never make it to the surplus, wholesale, or drop-shipping market. Example: To get Louis Vuitton handbags through a surplus dealer is almost impossible. Surplus dealers that are promoting LV Handbags are misleading you.

Same is true for persons who are selling designer handbags on eBay in mass quantities. The likely scenario is that they are Chinese knockoffs. Over 80 percent of well known retail solutions here in the United States are copied in the People's Republic Of China. Those solutions include Nike, Reebok, Puma, Adidas, Louis Vuitton, Calloway (Big Bertha) golf clubs, and just about any product that enjoys common merchandising status.

There is no plan by the Chinese government to stop "knockoff" activity because it is a thriving industry that provides employment for the masses. Despite the pleas from American companies to "cease & desist," there is a tepid response from Chinese officials to do address the issue. When raids are conducted, they are "ceremonial" public relations stunts to appear as if they are actually taking action against the counterfeiters.

Another indicator of authenticity is price. You will not find any authentic Louis Vuitton handbags for 30, or even 100 dollars. Most are 500.00 and up. To illustrate this point even further, just think about the well known celebrities of these days who are clothes and handbag aficionados. Jennifer Lopez, Britney Spears, Jennifer Aniston, Angelina Jolie, all sport around town with "Louies" that can fetch up to 10,000 dollars for an exclusive style of handbag. Do you think you will ever have access to these items in the wholesale, surplus, or drop-shipping market?

Forget it! You might not even get these in some upscale boutiques! You will find individuals so well connected that they buy up "hot items" like LV Handbags before they even hit the stores. They know who wants these items, and they may purchase whatever is available just so they can have an exclusive for their celebrity clients. Don't get me wrong. It's not that you can't get "designer duds" or handbags at wholesale prices. You will not get high end clothes and accessories that are featured in the latest issue of Vogue, Cosmo, as a "product for resale," in any wholesale environment, unless you spend thousands for the right to distribute such a product.

Even if some of these products made their way beyond the connected channels of purchasing, exclusive clothing and handbag things like Louis Vuitton will have limited distribution in "hand picked' boutiques, and well connected purchasing agents. In addition, you'll find men and women in the fashion industry, as well as other branded industries that would rather have their merchandise burned, or buried before it would reach the wholesale, surplus, or drop-shipping market!

For a healthy does of honesty, and an eye opening perspective concerning the realities of purchasing designer clothes for resale, the Clothing Broker will definitely explode some well-liked myths about obtaining such products, The Clothing Broker: TheClothingbroker.com

THERE IS GOLD UP IN THEM THERE HILLS!

Now lets address the Surplus & Salvage Industry. When individuals first encounter some of the delivers from Surplus dealers, or brokers, they tend to suffer from what I call the "I just found Gold" syndrome. A feverish excitement permeates their brain cells, and reduces them to a quivering pile of jelly, leaving their reasoning skills inoperable! A few thousand dollars later, and following coming to the conclusion that their "Golden Opportunity" turned out to be bars of lead, elation, then turns to anger.

It is a cliche, and I hate using it, but it is a lot more than appropriate when it comes to surplus and salvage products. "If it sounds to good to be true, it probably is!" Some Surplus dealers will hone in one at least one of seven deadly sins--greed! As with wholesale, you will never get certain merchandise for "pennies" on the dollar. One type of surplus solution category that has some individuals losing their minds is surplus and salvage electronics.

The problem with electronics is that they have a low profit margin even when they are brand new. Finding surplus dealers with working, undamaged, electronic merchandise can be a daunting task. Most salvage electronics can be in pretty rough shape, then you need to visit Techliquidators.com

What you are getting from most Surplus Dealers, or companies who specialize in electronic salvage is someone's customer returns, i.e., "junk!" Unless you are a electronics technician, or recycler, then I would stay away from "salvage" electronics.

Even solution that is not damaged, and still in the box or retail blister pack, can have a pretty high surplus price. If you find that someone is offering you a electronics item, be it a DVD Player, or Xbox, for eight dollars a unit, then "buyer beware."

GETTING DROPPED BY DROP-SHIPPING!

My last critique, and word of caution is about drop-shipping. You might have access to information about drop-shipping companies that would prove me wrong. I will not argue with anyone who is dealing with a dropshipping company who is serving them well. However, I will tell you that dropshipping is a danger. I really can't recommend any type of guide, or information that would lead you to a reliable source of drop-shipping companies.

Unlike surplus and wholesale, where you physically own and control the product, that option has been taken out of your hands. You are entrusting a company to ship products directly to your customers. If you get involved with a company who cannot deliver, or who is back ordered, you can find yourself with some very irate customers. Sign up fees, shipping fees, and expenses for support materials can really affect the bottom line.

Also, most drop-shipping companies like to send out item in volume. If you are selling just a couple of things per week, or per month, it might not be worth if for a drop-shipping company to deal with you. Large retail catalog companies use drop-shipping or "fulfillment" houses, but these companies cater to large scale operations.

The bottom line is this. When it comes to finding solution provide for your small business it pays to do your homework. Visit the company facility when you can. Never wire any money into a company account. Use a credit card, or Escrow service to protect yourself should your supplier not deliver, or send you defective merchandise.

Understand that you will not be able to get the latest and greatest technology or fashions at surplus and under mistine prices. If you follow all of these rules, and you use common sense as your "crusade" you just might be capable to find your own "Holy Grail," of wholesale solution supply!