Most people who are new to Ebiz view Wholesale Suppliers as something mysterious and somewhat fearsome. Don't worry; they're not going to bite. Wholesale Suppliers are just people doing a job. Sometimes it's not the job you want them to do, but it helps to understand the answers to the 5 most common questions about them.
1. Will Wholesale Suppliers work with Home-based Online Business Owners?
Most wholesale suppliers are large businesses working to find large accounts with big box stores. Wholesalers don't make a very large profit margin. So, they need to consistently sell a lot of product in order to stay in business and make money.
Because of this, many of them would rather not work with small home based businesses. That's not what most home business owners want to hear, but it's a fact that you should be aware of. When you approach a Wholesale Supplier, you need to convince them that doing business with you is going to be worthwhile to them. Remember that when they set up an account for you, they are going to devote resources (mostly administrative time) to managing your account and they want to make sure they're not wasting that time.
2. What do I need before I approach a Wholesale Supplier?
You absolutely must have a legal business. Whether it's a Sole Proprietorship (also known as a DBA), an LLC (Limited Liability Company) or a Corporation, you have to own a legal business before a real Wholesale Supplier will even talk to you. Once you own that legal business, you must get a Sales Tax ID within your State.
This is because a Wholesaler is not going to charge you Sales Tax when they sell to you at wholesale. As we all know, Uncle Sam has to have his due, so somebody has to collect that sales tax. As the product retailer, that somebody is you.
Wholesalers are required to keep the legal Tax IDs of their customers on file at all times, to prove that they're only selling to businesses that are licensed to collect sales tax. So before you contact a Wholesaler, make sure you form that legal business and get a Sales Tax ID.
Keep in mind that a company calling itself a Wholesaler that does not ask you for a Tax ID is not a real wholesaler. There are thousands of scam operators calling themselves Wholesalers in the search engines. They get in between you and the real wholesaler, and mark up the prices, cutting down your profit margin. Stay away from these people at all costs; they'll prevent you from building a profitable business.
3. How do I convince a Wholesale Supplier that my business is worth their time?
Make sure you check out the Wholesaler's web site before contacting them. They'll have the answers to most of your questions on that site. When you do contact them, that preparation will let them know that you did your homework. The last thing a Wholesale Sales Rep wants is a small business customer that sounds like they're going to be high-maintenance.
When you call a Wholesale Supplier, make sure you use your company name. That lets them know you actually have a legal business, as opposed to the calls they get all the time from 'window-shoppers' who aren't really in business at all. Tell them you're a retailer interested in selling their products. Get as far into the conversation as you can before mentioning that you're selling online. Never mislead the Supplier, but take the time to let them ask you some questions before volunteering that fact.
Don't be upset if the Wholesaler can't work with your online business. It's not the fault of the Wholesale Rep you're talking to...it will be a company policy. If they can't work with you, just thank them for their time and move on to the next Supplier on your call list.
4. How do I get pictures and descriptions of a Wholesaler's products for my web site or auctions?
Wholesalers that are willing to work with online businesses will have images and product descriptions available for you in some kind of electronic form. Most of the time, they'll tell you to go to a certain page on their web site and click a link to download those images and descriptions. Sometimes they'll email you a link to do the same.
Either way, they'll offer images and descriptions in some form that you can use to place on your site or auctions.
5. How does Drop Shipping work?
Drop Shipping is a low cost way to start selling products online without having to buy them from a Wholesaler first. Some Wholesalers offer drop ship programs; most do not.
A Wholesaler that offers Drop Shipping is willing to ship one product at a time for you, directly to your customer's address from their warehouse. You place the product image and description on your site or auctions, make the sale and collect the customer's money for the product and shipping, and then you tell the Drop Ship Wholesaler to send the product to your customer at their address. The Wholesale Drop Shipper then charges your debit or credit card for the wholesale cost of the product plus shipping. So, you collect the retail price before you pay the wholesale price.
Drop Shipping is a great way to get started without laying out a lot of cash, and it's a good way to test product markets inexpensively. It's not generally a permanent solution. Use Drop Shipping to test your markets and figure out which products sell best for you, and then use your profits from those sales to start buying your best selling wholesale products in bulk. When you buy in bulk, your wholesale products cost less, so you increase your profit margin.
By Chris Malta
Chris Malta has been an Entrepreneur for 35 years. He's the Founder and CEO of WorldwideBrands.com, an EBiz Radio Talk Show Host, a published EBiz Author, Contributing Editor to eBay Radio, and the creator of dozens of instructional EBiz videos and free EBooks.
His company is recognized as the best in it's field by businesses including eBay, Yahoo, Amazon, Intuit, UPS and many others.
Chris Malta personally Trains and Mentors new EBiz owners through his Personal EBiz Workshops at http://www.ChrisMalta.com/Workshops
Chris is a well-known crusader against internet business scams. Save yourself a tremendous amount of money in your online business - get Chris Malta's FREE EBiz Scam Report now at http://www.ChrisMalta.com
(c) Copyright Chris Malta 2009, all rights reserved worldwide
Article Source: [http://EzineArticles.com/?5-Most-Common-Wholesale-Supplier-Questions-Answered&id=3506984] 5 Most Common Wholesale Supplier Questions Answered
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