This guide walks beginners through how to sell wholesale, how to tap into the $10 trillion wholesale industry, with tips for sourcing wholesale items to sell and setting up your store today.
Imagine you could focus more of your efforts on product design and innovation, beautifying your brand, or streamlining operations instead of finding customers and worrying about sales.
Marketing doesn’t come naturally for all entrepreneurs, which can make sustaining and growing a business a struggle. Luckily, you can pass on some—or even all—of that responsibility to other businesses, by creating a wholesale channel.
Learn to sell products wholesale online 💰
- How does wholesale work?
- Is selling wholesale worth it?
- Best wholesale products to sell
- Where to find affordable wholesale products to sell
- Coming up with a wholesale pricing strategy
- How to set up a wholesale channel
- Accepting payments for wholesale orders
- How to sell wholesale products
- Start selling wholesale today
- Wholesale business FAQ
How does wholesale work?
Wholesaling is the act of selling your products in bulk to another retailer, usually at a discount, who then sells the product to its customers at a higher price. It’s important to note that creating a wholesale channel for your online business does still allow you to sell your product to the end consumer.
As a wholesaler, you can sell to both consumers and other retailers. You don’t have to choose one or the other.
The first examples of wholesale businesses that might come to mind are probably large brick-and-mortar department stores, like Walmart or Target. Wholesale is, after all, often thought of as an old-fashioned business model that’s being disrupted by newer direct-to-consumer ecommerce businesses.
One of the myths about wholesale ecommerce is that you need loads of cash to get started. While you do need some startup money to break into the wholesale market, there are ways to scale your growth. For example, reorganize your existing space to make room for your bulk products rather than renting a new storage space right off the bat. And don’t forget to negotiate with your suppliers—they tend to be more flexible when you’re making a large order.
However, in more recent years, wholesale has experienced a revolution of its own due to online selling sites like Amazon, Wish, and Wayfair. While ecommerce lets direct-to-consumer brands thrive by lowering the barrier to setting up shop, wholesale still offers consumers a convenient shopping experience where they can find everything they need in one place.
Is selling wholesale worth it?
This newer version of wholesaling, which often takes place in online marketplaces or through smaller boutiques, has advantages that attract direct-to-consumer brands, too. Here are three reasons why opening up a wholesale channel might benefit your business.
1. Increase sales without increasing marketing spend
As a direct-to-consumer brand, a large amount of your budget needs to be allocated to marketing in order to grow. For every new customer acquired, there is often a cost, after all.
The most common myth is that B2B customers won’t shop online, so there’s limited growth potential. In truth, B2B ecommerce is experiencing massive growth and drives much higher revenue than B2C ecommerce.
By selling your products wholesale, another business shoulders the cost of customer acquisition while you reinvest your time and money into other areas of your business.
2. Leverage other brands’ audiences to sell your product
Just as acquiring new customers costs money, building a loyal audience of fans and customers is not an easy feat. By creating a wholesale partnership with an established brand that has already made a name for itself within your niche, you can leverage the company’s goodwill to get your product into customers’ hands.
3. Enter new markets with less risk
Expanding your business to a new country or territory comes with a series of associated costs, like warehousing and logistics. You might also have to start from scratch, marketing to a population that hasn’t heard of you.
Finding another retailer with an existing presence and supply chain in a new market can reduce the risk of international expansion by cutting your setup costs.
Ultimately, a wholesale business model benefits both the retailer and the wholesaler by creating efficiencies. The retailer gets a new—often complementary—product to sell without investing in research and development, and the wholesaler saves money on marketing by gaining direct access to an existing customer base.
Best wholesale products to sell
There is a large annual market for education supplies. In the United States alone, there were more than 49.5 million K–12 students enrolled and more than 3 million teachers employed in public schools in 2021.
Below are some education products to consider wholesaling:
- Arts and crafts supplies
- Educational software
- Writing utensils
According to Statista, home improvement sales in the United States amounted to around $538 billion in 2021. By 2025, this amount is expected to reach over $620 billion. Home décor is a solid market for the wholesaling business.
Some home décor products to consider wholesaling are:
- Frames/wall art
- Candles and candle holders
- Throw pillows and blankets
- Storage and organization
Clothing and accessories
Whether it’s clothes for work, day-to-day, or special occasions, everyone needs to wear something. That’s why fashion is a large and ever-growing market. In 2022, the revenue of this market was approximately $1.53 trillion U.S. dollars. According to the Consumer Market Outlook, this value will increase to almost 2 trillion U.S. dollars by 2027.
Some popular product types to consider are:
Every human on this planet needs food, and will continue to need food for the rest of their lives. So this is an obvious category to wholesale, as the demand will always be there.
Below are some food products to consider wholesaling:
- Ice cream
- Oils and shortening
- Fresh produce
- Keto products
Purses and handbags
About $4.1 billion worth of women’s handbags were imported into the US in 2021. Don’t be fooled by the specificity of the category—this is a huge market.
Below are some types of purses and handbags to consider selling wholesale:
- Men’s bags
- Kids’ bags
There are well over one hundred cooking shows available to watch right now, not including spin-offs or syndicated shows. That means cooking, and what you use to cook with, have become purchases that more and more people have taken an interest in. Wholesaling kitchen materials is a business with the potential to last you a long time.
Below are some kitchen products to get your wholesaling business off the ground:
- Table linens
Health and wellness
Here are some health and wellness products that do well in this product category:
- Vitamins and supplements
- Anti-aging creams
- Skin care regimens
- Fitness apparel
- Yoga accessories
- Organic beauty products
US homes spent an average of $969.32 in 2021 on each pet in the home. It’s clear that getting into the pet supplies wholesale business is profitable. Here are some products to consider:
- Health care
- Cleaning supplies
- Clothing and accessories
- Leashes, collars, and harnesses
- Crates, cages, and aquariums
Despite the pandemic’s global grip in 2021, the party planning market still reached $3 billion. Wholesaling party supplies not only gives you a variety of products to sell, it gives you volume as well. Plus, the market doesn’t seem to be going anywhere.
Here are some products to consider in this category:
- Party favors
- Disposable tableware
- Banquet equipment
Where to find affordable wholesale products to sell
Finding profitable products to resell not already on Amazon or eBay is challenging. That’s why we’ve rounded up the top marketplaces to find high-demand bestsellers from worldwide brands.
Alibaba and AliExpress
The Ali family of sites is China’s most dominant online marketplace. Data shows it has a 69% share of the domestic (Chinese) ecommerce market. Alibaba is for B2B buyers purchasing wholesale products, while AliExpress is for B2C products.
Alibaba and AliExpress are good for finding:
- Wide variety of products
- Private label or white label items
- Medium- to low-quality goods
Salehoo is a New Zealand-based wholesale marketplace with more than 8,000 suppliers. In order to use the network, it’ll cost you a $67 per year membership fee. That will get you access to suppliers and customers in New Zealand, the United States, the United Kingdom, Canada, and Australia.
Faire is a wholesale marketplace operating in Europe and North America. Based in San Francisco, it ships to more than 15,000 cities in 15 European countries, the United States, and Canada, and offers over 60,000 independent brands. It’s free to join Faire, and you only pay a commission if Faire connects you with a new retailer through their marketplace.
Tucked away in quiet Aurora, Ohio, Boutsy is a wholesale marketplace specializing in boutique items. It has 200,000 independent retailers that provide products in 12 categories, including pet, wellness, and home goods.
Boutsy doesn’t require a membership fee to use its services, but it does have a 15% commission on any sale made through its site.
Tundra is a zero-fee wholesale marketplace with over 10,000 brands as suppliers. However, Tundra is a great wholesaler for people just starting out because it’s completely free to use the service—it doesn’t even take a commission from your sales. Tundra also ships wholesale products to over 100 countries.
TradeGala is a London-based wholesale marketplace focused on fashion brands. It offers a three-tier membership, yet none of them requires a membership fee. If you’re a wholesaler looking to break into the fashion market, know that TradeGala only takes commissions off of sales made through its site.
IndiaMART is a free wholesale marketplace for both sellers and buyers. Based in India, it has a massive network of seven million suppliers in 40 categories at your disposal. It stocks everything from consumer goods to medical and industrial supplies, and even agricultural supplies.
IndiaMART is also one of the few to offer over-the-counter (OTC) pharmaceutical dropshipping services. If you have a defined niche, IndiaMART is a good option for you, because it has contact with many industries.
eWorldTrade is a US wholesale marketplace with thousands of suppliers providing items in 39 categories. Know that eWorldTrade is on the pricey side: it has five major selling plans, and the cheapest begins at $399/year.
Coming up with a wholesale pricing strategy
Pricing strategies are one—if not the most—crucial component to creating a successful wholesale business. When selling directly to customers on your website or in your retail store, you get to keep whatever profit margin you set for yourself, which often can be north of 50%.
With wholesale, businesses typically give retailers a 50% discount off their regular retail price. The steep discount is to allow online retailers to wholesale your product to their customers, while still retaining some profit margin as well.
Here is an example of a healthy pricing strategy, where a wholesale business would retain a 50% profit margin on wholesale orders and a 75% profit margin on direct-to-consumer sales:
|Product SKU||Product Cost||Wholesale Price||MSRP|
Therefore, in order to create a successful wholesale business, you’ll need to offer a large discount off of your retail price to those willing to wholesale your product. This can sometimes pose risks for small businesses, including not being profitable.
Luckily, there are ways to price your product for wholesale to mitigate the risk of not being profitable. One way is to offer a discount based on purchase order quantities. This way, retailers are encouraged to place larger orders for a better margin upon resale of your product. Many wholesale businesses even set minimum order quantities (MOQs) that retailers must buy in order to carry their product.
When you decide to wholesale your product and have it carried by multiple stores, you can sometimes run into issues with competing retailers undercutting each other when it comes to price. This is why creating an MSRP is an important element of your wholesale pricing strategy.
An MSRP is often part of a contract that a business will give a retailer that wants to sell its products. It guarantees the retailer will stick to the suggested retail price so the product pricing will be the same wherever it is found in stores or online. Usually, the MSRP is found alongside individual products on a wholesale storefront, or on a sales sheet or product brochure sent to prospective retailers who wish to carry your product.
One thing to consider when setting up an MSRP agreement is if you want to allow discounting around holidays like Black Friday and Cyber Monday or specify certain times you might want to discount the product on your own website to customers.
As the wholesale supplier, you get to set the rules that your retailers have to comply with, but maintaining a fair pricing balance is essential to making your retailers successful. If your retailers are able to make a profit selling your product, they’ll continue to come back and place larger orders.
How to set up a wholesale channel
When it comes to how to sell online, you first need to consider if you want to create a pure wholesale business or offer a wholesale option in addition to selling directly to consumers through your own store.
There are multiple approaches:
1. Password protect your wholesale store
If you are considering only selling your product wholesale through other retailers, you will need to create a password-protected online store so only your retailers can place orders at your discounted price.
The easiest way to lock your online store is through your ecommerce platform. If you’re a Shopify store owner, use the password protection feature available in the Shopify admin.
Your Shopify store can be password protected under Online Store > Preferences. By creating a password-protected online store, you can set up all your products with a discounted price for your retailers to purchase.
If you are running a larger wholesale business and are worried about your password getting out to unapproved retailers, you might want to look into a more sophisticated password protection app, like Locksmith.
The Locksmith app allows you to lock individual products, collections, and variants.
Locksmith’s customizable features give you advanced control over who can see your store and what products they can purchase. Instead of creating one generic password, customers can create accounts and set up their own unique password.
You can also grant customers access to products by applying tags to their profile, sharing a secret link with them, personalizing your inventory based on what country they’re browsing from, and many other conditions.
With Locksmith, you can choose which customers have access to what parts of your store and how you share that access with them.
2. Use Shopify to open a separate wholesale storefront
For businesses that already have a direct-to-consumer store but want to create a wholesale channel for retail businesses to buy from, there are several options available. The simplest one would be setting up a second Shopify store with a different URL and using one of the two options listed above to password protect it.
If your company does a high volume of sales, consider upgrading to Shopify Plus and take advantage of its wholesale channel feature. On Shopify Plus, you can create a wholesale channel within your existing store that’s password protected.
The wholesale channel creates a wholesale storefront using your existing products, so there’s very little additional work involved in setting up this channel.
You can customize pricing by customer groups, using percentages off or volume-based discounts.
Best of all, your sales reports are all separated from your direct-to-consumer sales within Shopify reports.
3. Use a wholesale app to create a wholesale channel
Another way to create a wholesale channel on your Shopify store is with the assistance of a Shopify app like Wholesale Club. With Wholesale Club, businesses can break up their retail customers into tiers, which are assigned specific discounts off of regular retail prices.
The app also has a built-in marketing feature that can be used to incentivize customers to buy more for a larger discount. Volume-based discounts can be given to wholesale customers based on cart total and item quantity.
With Wholesale Club, only customers who have approved retailer accounts and are logged in will get access to wholesale pricing. You can create a secure wholesale channel in addition to your direct-to-consumer one, without needing to set up a separate store or product catalog.
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Accepting payments for wholesale orders
One way wholesale differs from direct-to-consumer transactions is in the payment terms usually expected from your retail partners. Unlike a regular sale, if a retailer is buying a large quantity of your product, they may ask for payment terms that are often referred to as “Net X”—an agreement that the net payment is expected in full within a set number of days (for example, Net 30 for payment within 30 days).
If a retailer is asking for these preferred payment terms, it means they want to be able to pay you, as a vendor, within a certain number of days of receiving their order. Shipping a large order to a retailer before they’ve paid can be risky, especially for small businesses. This is why you ask for references and perform due diligence before agreeing to these terms.
Limiting payment options to either immediate or invoice-only can hurt sales. Offering a finance option (where you outsource the risk) is an effective way of increasing conversions and, perhaps more importantly, raising average order sizes and repeat business. But offering a variety of options is a must.
How to add net payment terms to your store
Both of the Shopify apps Wholesaler and Wholesale Club allow you to offer customers net payment terms. Customers can be tagged according to the agreed upon payment terms, and when they shop in your store they can place unpaid orders.
With Wholesaler, tagging customer profiles will give them net payment privileges.
How to collect payment from wholesale customers
When it comes to actually collecting a later payment, there are a few options for businesses managing their wholesale channel online.
One is to record wholesale orders as draft orders on your Shopify store, which lets you invoice customers through Shopify for them to pay by credit card at a later date. With draft orders, you can also record a payment via check by marking an order as paid once the payment is received.
Under Drafts, store owners can create orders and send customers invoices to be paid at a later date.
Afterpay is another potential solution to taking late payments. The app is typically used for direct-to-consumer sales so customers can pay for their purchases in installments.
This same feature could be used for a wholesale channel or store, letting you collect payment information from your retail customers and only charge them later in installments. An app like Afterpay can automate the payment collection process without the need to track and check up on unpaid invoices.
How to sell wholesale products
Now that you have your wholesale pricing strategy figured out and a wholesale channel set up in your store, it’s time to search for prospective wholesale customers. But where do you find these retailers, and how can you increase sales?
Join a wholesale marketplace
Retailers today can find and order products from wholesale marketplaces. Aside from selling wholesale to retailers in your own ecommerce store, you can also join a popular marketplace to build brand awareness and reach new buyers.
Do research on prospective marketplaces to make sure they’re the right fit. You want the marketplace to easily integrate with your store.
Use your direct-to-consumer website
Oftentimes, a retail customer will actually find you first. If you’ve had success with direct-to-consumer advertising, you’ve possibly already received messages from distributors who want to carry your product online or in their physical stores.
When you are advertising to consumers online, you are also reaching other business owners who might be interested in carrying your product. This is why it’s important to keep a link in your website footer for wholesale inquiries: so anyone browsing your website can easily contact you about potential opportunities.
Attend trade shows
Trade shows are traditionally where a wholesale business goes to make connections and find retail partners. There are specialty trade shows for nearly every category of retail, from baby apparel and athletic leisure clothing to furniture and home décor. There are even trade show directories that list top trade shows according to categories.
Don’t get trapped in the ‘If you build it, they will come’ mentality. You have to go out there and hustle: on the phone, at trade shows, and in person at stores. Simply being live and visible in the digital space isn’t enough unless you push your brand in the real world.
Trade shows, however, can be expensive. They often require travel and a substantial booth fee, if you want to exhibit there. It’s worth attending them first and walking the floor to make sure it will be worthwhile to exhibit.
Reach out to complementary brands
One added benefit of a wholesale channel is that, unlike direct to consumer, you don’t always need a large volume of customers in order to grow. If you have a handful of high-quality retailers who are successful at selling your product, they can come back and continue to place larger orders again and again.
To find these select partners, reach out personally over social media, phone, or email to a company you believe would be a great fit. A business that sells complementary products is a good place to start.
Pehr and Stokke formed a partnership and now sell each other’s complementary products on their respective websites: Stokke creates and sells a line of cribs and baby furniture for design-minded families. Pehr created a line of 100% organic sheets that are now sold on the Stokke website, while Pehr carries Stokke’s cribs on its site.
Some of the best wholesale partnerships are made through personal contact and establishing trust and rapport in real life. So if you see a brand you admire, reach out if you believe working together would benefit both sides.
Use incentives to motivate buyers
Incentives work for wholesale buyers just like everyday consumers do. Some retailers selling wholesale will offer discounts to buyers based on the amount of products they buy. A common offer is a percentage off for a customer’s first order. Other incentives could include offering:
- Low order minimum requirements
- Free shipping based on order amount and delivery location
- Various payment options
- Bundle deals
- Free samples and testers
You could also offer dropshipping services as a wholesaler. When a company sells a product on its website, you deliver it to the end customer versus a wholesale distributor, which could be cheaper for the company.
Start selling wholesale today
The rise of ecommerce has allowed direct-to-consumer brands to launch faster and grow digitally. As a result, many had written off selling wholesale items as a fading retail trend. However, a new wave of wholesale startups are actually thriving in the era of ecommerce by rethinking the way wholesale works.
Both direct-to-consumer brands looking for new sales channels and entrepreneurs who want to save on marketing spend are opening wholesale businesses. With the right pricing strategy and a little know-how, you can start opening your business up to new revenue-generating partnerships and see your product flourish among complementary brands.
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Wholesale business FAQ
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3 Quick Steps to Selling Wholesale
1. Choose what products to sell
Education supplies, clothing and accessories, home decor, and food or cooking supplies are all good options.
2. Come up with a pricing strategy.
Offer discounts of 50-75% depending on order volume, so that your product is profitable for retailers to sell.
3. Set up a wholesale channel
Your store can be wholesale only, or you can set up a wholesale subdivision within your retail online store.