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Beginner’s Guide to Buying Wholesale

Profile picture of Lilla Stefanovszky
Lilla Stefanovszky
12th November, 2020
17 minutes

How does wholesale buying work? To build a solid business in this industry, it’s best to inform yourself first, by going through this guide.

If you’re planning to start in this industry, you surely have thought about how to supply the products you chose to sell. If you thought about this, that means – you don’t make your products. You might not know this, but wholesale suppliers could be the best source for high-quality products for your online store. Some of them have great offerings and services. You just need to make a deal that would suit you both, and you are set for life.

It’s true that many entrepreneurs don’t believe in wholesalers. The reason for that is because it’s hard to find the right wholesale supplier who offers premium services.

Therefore, we decided to create this guide for buying wholesale to help you learn the basics and choose your wholesale supplier cautiously. Make sure to read the guide through the end and use our tips wisely while you are choosing the right supplier.

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What does it mean to buy wholesale?

Firstly and most importantly, don’t get confused with the term. Buying wholesale is a whole different process from buying retail. If you still feel like you’re missing something, let’s elaborate on this in detail. So, if you buy wholesale products, you buy a large number of items to sell at once. In contrast, when you buy retail, it means there’s a third party between you (the retail store) and the manufacturer.

Almost every time you buy wholesale, you’ll be offered discounted prices on most products. From a wholesaler’s point of view, it’s much harder to sell large quantities than it’s to sell products in smaller quantities, meant for small business owners. Where do you make the profits? Whenever you sell products for a higher price to your customers, retail of course. The price that your customers pay to you when they buy the products – is called retail price.

The profit, or the margin whatever you like, is the difference amount between the manufacturer price, and the retail price. You choose your retail price according to many factors. Rules don’t exist, you simply calculate your cost, and you add the profit to form a price. This is a decision you need to make while you create your marketing and sales strategy.

Calculating the costs of buying wholesale

There is one famous definition all entrepreneurs need to know before they set a price on their product.

Revenue – Cost = Profits

It seems simple, but many entrepreneurs don’t know how to calculate their costs. The price your customer pays when you are selling your product to them is the ‘Revenue’ – or the retail price. The costs, or COGS, are all the costs that you pay when you procure the goods. But when you are buying from a wholesaler it is much simpler. You don’t have variable costs, you only have fixed costs. It is easier to calculate them. You can get your estimated price with little to no calculations.

The gross profit is calculated when you take off the costs of your sale price. The most common practice for online store owners is the “raising price” method. That means, buying a cheaper bulk of products, then selling them for a bigger price. For example, you can buy fifty $10 chargers for a certain iPhone model, and sell them for $30 each on your online store.

Buying wholesale: learn the costs and profits

You can see that in this case, the profit from this sale is 20$ for each product. But, there are variable costs. If you have a physical store, you need to pay your employees, or you need to pay bills or rent. When you sum this up, the wholesale price should be low enough for you to cover your expenses, and make you profits.

Keep in mind that you can’t play with your prices. Once you are on the market, the customers should know why you are their right decision. In the eCommerce market, it’s easy to find a replacement for your products. Just stay in your lane, and keep your qualities to retain your customers.

It is the same for the other side, too. Before you can do business with a manufacturer, you must meet their conditions. There are conditions like minimum quantity, minimum fare. By minimum quantity, it means that you can’t buy just one product. You must buy a bulk of them. Why do manufacturers set these rules? Because they want to be profitable as well.

Which is the right practice for buying products in bulk?

When you’re buying wholesale products, try to make the most of it. Our advice is to order your most popular product because you know you will sell it. Keep track of your sales to spot your most popular products, dive deep into the data of your online store.

In this process, you need to find your supplier as early as you can. It’s a great idea to start searching them in your local Facebook groups for dropshipping. Try to get in touch with other people that sell online and supply their products from local or foreign manufacturers.

You need to gather around a list of the best wholesale clothing vendors. Find everything about them, do your research. If there are bad reviews, you won’t get burned as your last fellow entrepreneurs. Once you have your insights about them it is much easier to choose which one is the best for you.

You need to set a range of products you will be selling on your online store. When you are looking for your supplier, you must check if they have all the products you want to sell in your online store. There are many suppliers with a wide range of products, but do you need them? Maybe if your product is specific you need to narrow your search results. This is a good point when you are thinking about your supplier, so choose the one who has the potential to keep up with your business growth.

You need to make a profit, so when you set up your business plan keep in mind your costs. When you are creating the prices for your product, keep those numbers in your mind, don’t be fooled by the wholesalers. You need to dive deeper into the reviews section of your supplier. You are looking for the perfect person, the one you can rely on for the supplies. The customers are waiting on the other side. Consistency is the key, keep searching, and don’t rush.

Good customer service is a great plus when it comes to communicating with your wholesaler. It is very important for you because if you are new to this, you will have a lot of questions to ask your manufacturer. If there is no one to answer them, then you know that manufacturer is wrong for you and your online store.

Check their knowledge about the product they sell. Maybe they are just wholesale resellers. You can’t rely on that type of person when you are getting into the eCommerce business. The more you know, the better. You can use that knowledge to make your products stand out in front of the customers. If they don’t know the specifics of their products, then they either don’t care, or they are just bad company. Keep this in mind when you choose your wholesaler. A great businessman knows his products and their qualities.

Where can I buy bulk wholesale?

More specifically, where should you start looking? We’ll present to you a couple of tips to follow. They can help you find the perfect wholesale clothing supplier – the one that you are most likely looking for. For example, starting a wholesale partnership with BrandsGateway can help you benefit in numerous ways.

Wholesale suppliers aren’t running things small-time. They are managing a whole business that usually buys, or manufactures a lot of products. In return, they supply small businesses, online retailers, retail storefronts, or chain stores mostly. In case they aren’t manufacturing items, they still play a big part on their end.

How to find the right company that will supply your business?

If you are an experienced reseller, it means you have already worked with a couple of wholesalers by now. But, if you still haven’t worked with a wholesale supplier, you need to find the right one because your business requires it.

When you look for suppliers, head for the things you need: consistency and the right contacts can deliver fast and hassle-free, location, and great prices. Choosing the type of wholesale product to sell before choosing a wholesale supplier is the first thing you need to have in mind. Once you’ve set your mind to the products you need, it’s time to do some research and find the best possible options for supplying them.

Understanding products, the industry, and conducting market research

If you have a specific product niche in your mind, make sure to “update” your knowledge, by reading the latest news and trends. There are a couple of ways you can get your product, so keep in mind that not every wholesaler is the same. Mainly, there are a few types of wholesalers out there, so, we’ll only mention the important ones.

The one who produces the products – the manufacturer. You can often try to buy directly from them, especially if they are just starting out since they could use the clients. They usually sell at cheaper prices than importers, since importers act as middlemen between dropshippers and manufacturers. However, it’s incredibly hard to strike a deal with manufacturers, as they mostly sell to the merchant and retail wholesalers.

Do a research to learn more about the market of wholesale buying

The latter, popularly known as – the merchant wholesaler. This type of wholesaler buys directly from the manufacturer, stores all products, and then sells them to customers. There’s no limit on how they sell, be it online or retail. If there is any loss of value in the products between the process of buying and selling them, it’s solely the merchant wholesaler’s fault.

Lastly, the full-service wholesaler, or, in this case, – the retail wholesaler. They act as full-service wholesalers. They operate mostly in the retail marketplace and sell items to resellers. For example, a retail wholesaler can import products from a manufacturer, then provide services to resellers (e.g. dropshippers), who then sell them to end-customers. They provide logistics, shipping, packaging, and any other service required to achieve full service. It’s the preferred supplier for any store, brick, and mortar, or online retailer.

There are also commission-based agents and brokers, connecting wholesalers with customers. They work with small quantities and are responsible for logistics and import, which is a risky thing to do. However, the aforementioned ones are far better if you’re just starting out.

Thus, when you start with product research, don’t forget to check all distribution channels available. Every industry has its advantages and disadvantages. It’s better to know them all before you start working with any specific wholesale supplier.

Set your information requirements before you contact the wholesaler

You’ll need to know specific information before you get in touch with your supplier. The most common things that small businesses need to know are the minimum order quantity, product price, and shipping availability. Make a list and write it down before you contact them.

Usually, the first contact is made via email or phone. To begin with, don’t sound arrogant at all, just know what you are looking for and be professional. If you are already in contact with other suppliers, you should let them know because that way you’ll get the chance to negotiate for a better deal and cheaper prices. However, try not to mention any competitors because if you don’t play it right, it can backfire really quickly.

Do your market research, dive deep into the marketplace

Set your mind onto a specific range of products, and learn all you can about them. While at it, look for all the keywords you can find, main competitors, various models, and different brands. You’ll be needing them all for future usage.

There are cases when you’ve found the perfect wholesale distributor, but you can’t contact them because they forgot to put any contact info on a website. The WHOIS website information provider can help you get all the information you need. Next, aim to find multiple wholesalers, so that you can make a proper selection after you’ve found them. Also, you can compare all their prices, any conditions they offer, and the reviews they get. You can easily find reviews for a wholesaler by Googling their name and add ‘reviews’ at the end of the search term. For example, just type ‘company X reviews’ on any search engine, and you’ll notice many insights concerning the company, including ones left by former staff, as well as customers.

Try the local and overseas B2B marketplaces

In the following decade, many businesses will be able to find tons of major (and rising) B2B marketplaces. So, as long as your company is able to buy large quantities of products, you’re good to try them all out.

To emphasize, many of these B2B marketplaces are located in Asia, which may be a double-edged sword for any retail store. They mostly rely on the ‘quantity over quality’ rule, so you may not find the quality you’re looking for there. Instead, focus more on Europe-based B2B marketplaces, to find the one that suits your needs. You don’t need the largest marketplace in the world if it doesn’t fit you. Also, Europe is positioned between Asia and the U.S., so it’s ideal for shipping products worldwide.

Networking reveals a lot about the industry

This is one of the most important things to know when starting out in the eCommerce industry and learning about buying wholesale. In truth, you will find the best experiences within your range. There are tons of small business owners who are willing to share their experiences with fellow owners, who in return, are willing to learn.

Attend eCommerce events to learn more about the industry

Thus, seek them out, find the right connections, and build your business based on real experiences told by the right people. You can easily find these kinds of experiences in wholesale forums because people often share their recent work stories there. LinkedIn also could be a great source of information. You can follow some of the best industry professionals, and build up to their business achievements. You can join some groups there as well, and subscribe to any quality newsletters full of helpful content.

Read about your industry and the trends

Before you enter the industry of wholesale buying, make sure you have extensive knowledge about it. Once you begin buying wholesale and reselling products, it’ll feel as if you’ve done this already. To learn more, you can find plenty of information online, or buy a bunch of trading magazines and start reading. Make sure to take notes on everything useful for the future. Make sure to spend at least 30 minutes daily reading the latest industry news, because new technologies reshape industries every day, and you need to keep up with it. The more you know, the better.

Attend industry events and shows

If you’ve already been to a trade show before, you probably know about how you can benefit from it. You can build your network with people that can help you grow. You’ll also get to speak and meet many people with the same interests. With these professionals, you’ll exchange knowledge and various experiences, including buying wholesale. By hearing how others have made mistakes here and there, you’ll definitely memorize how not to repeat the same mistakes, and of course, share some of your bad business decisions as well.

Nowadays, many trade shows and events are organized online. It’s currently easier to attend any of them, so don’t miss any opportunity to grow and learn more about the industry.

Price and everything related to it

To clarify, your goal is to make profits, right? Thus, you need to keep track of all costs, from the beginning to the end. When you know all your costs, you can form better prices, and dictate them as you please. Of course, customers always look for the best prices available, so don’t think you can make tons of profits if you set the prices sky-high. The best practice to optimize prices is to create and follow a plan. With a well-structured plan, you can predict some of the actions (and prices) that are bound to happen throughout the process.

Learn from your mistakes

Finally, just like in every other industry, mistakes can be made when buying wholesale products as well. Don’t be hard on yourself. No matter how much research you have done on finding the perfect wholesaler, things can go wrong at any time. Remember to keep your head up, learn from all the mistakes you’ve made, and don’t let them stop you from reaching your end goals.

What are the best sites to buy wholesale from?

A beginner’s guide to buying wholesale won’t be complete if we don’t cover this topic. Learning which are the best places to buy wholesale products is the foundation of building a profitable business.

For this reason, we will mention the most popular sites and wholesaler which you can analyze and pursue.


If buying wholesale authentic designer clothing is what you’re aiming for, BrandsGateway should be your first station. It’s the world’s largest B2B luxury marketplace with thousands of products available on-site, each item bringing in more profits than the previous one. There are over 50 sub-categories as well as stock lots with discounts of up to 95% off retail price.

Amazon Business

This platform offers the opportunity to directly exchange transactions between the retailer and the wholesaler. There are a couple of paid versions available, but the plus side is the multi-account option.

X Cart

Compared to other options, there are a couple of advantages and disadvantages that you might have to look at. It’s user-friendly, and you can connect it with your other accounts. This option allows you to manage your multi-channel marketing strategies.

Global Sources

Global Sources is one of the most successful platforms out there. Based in Hong Kong, they are expanding their business throughout every channel available. It is a great choice to do the B2B business.

eWorld Trade

What wholesale product categories can you find here? From security and machinery to chemicals and food, they deal with larger offers and effectively connect buyers with resellers, mostly in the more serious industries. Their HQ is located in the U.S., more specifically in Dallas, Texas.


The platform that it’s mostly targeting small businesses. Connecting vendors with buyers both in the U.S. and abroad, Kinnek is a new B2B marketplace with an accent on marketing, offered to any side of the industry.

All in all, these are some of the best wholesalers and marketplaces for buying wholesale products. Don’t forget to compare prices and choose the most suitable one for your store. Set your own criteria and then narrow it down to a few wholesalers. Compare them with your most important KPIs and choose the right one for you.

To sum up

To this day, the eCommerce industry has changed a lot. As all industries evolve quickly, don’t get too comfortable staying in one place. Try to keep up the pace and learn something new every day. We hope this guide has cleared some thoughts on the process of buying wholesale.

Follow our tips, choose your wholesale supplier, and start your eCommerce journey right away.

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