When I first started my Micro Business, the concept of selling wholesale was daunting. But after a little bit of research and a whole lot of trial and error, I realized the potential benefits of wholesale were too good to ignore. In this blog post, we're going to explore what wholesaling means, the types of wholesale available, and a few handy tips on how you can get started on this journey.
Wholesale, in its simplest form, is selling goods in bulk at a discounted price to a retailer, who then sells them to end consumers at a higher price. It's an excellent method to scale up and expand your business reach, especially if you have a product that people love.
Now, let's dive into the various types of wholesale options available. Each type of wholesale has its pros and cons, and understanding them will help you determine which one is most suitable for your business.
Traditional Wholesaling: This is the most common type of wholesale. You sell your products in large quantities to a retailer who will then sell them to the end consumer. This works great for businesses with high product turnover and offers a reliable income stream.
Dropshipping: A more recent addition to the wholesaling world, dropshipping involves selling your products to a retailer who then sells them directly to the customer. The unique aspect here is that you retain the inventory and ship it directly to the customer on the retailer's behalf. It's a low-risk option but can be labor-intensive.
Consignment Wholesaling: With consignment, you provide your products to a retailer, but they only pay for what they sell. This can be a great way to get your products in stores without requiring the retailer to take on too much risk. However, you may face the challenge of having your cash flow tied up in unsold stock.
Understanding these types of wholesale options will help you figure out which one best suits your business model. But before you jump in, here are a few tips to get you started on the right foot.
Know Your Numbers: Before you start wholesaling, understand your production costs and set a wholesale price that still allows you to make a profit.
Target the Right Retailers: Not every store is the perfect fit for your product. Do your research to find retailers that cater to your target market.
Create a Strong Pitch: Retailers get tons of pitches from wholesalers. Make yours stand out by telling a compelling story about your brand and product.
Build Relationships: Wholesaling isn't just about making sales. It's about building strong, lasting relationships with your retailers. This will pay off in the long run.
Have a Line Sheet Ready: A line sheet is essentially a business's catalog in a simplified format. This comprehensive document showcases all the products a wholesaler offers in a clear, concise, and appealing manner. Organized by categories or collections, each product is typically displayed with an image, description, SKU or item number, wholesale price, color options, sizes, and any other vital information a retailer would need to place an order. Every wholesaler will request this, so might as well make one.
Where to Wholesale
- Faire :There are a lot of places to wholesale, our main wholesale income comes from Faire. Faire Wholesale is a platform designed to serve as a connection between independent boutiques and independent brands to make sure small businesses have a chance at competing against larger ones like Amazon and Walmart. Faire is for the independent indie retailer an d micro makers. Faire is the golden child of online wholesale. Through Faire 90% of our stockists (brick and mortar stores that carry our products) found us through Faire. Faire is easy to set up, and makes your products available to thousands of retailers world wide! Faire is Traditional Wholesaling, if you want to sign up for Faire use this link, so we both get $$$.
- Locally Owned Shops: A lot of local shops offer Consignment Wholesaling. We only offer consignment wholesale with local shops, as it can get tricky keeping track of inventory. Most local shops want to stock local makers and can offer better percentages that traditional wholesale. For instance Faire is standard 50/50 where local shops can usually offer 65/35, where you make 65% off the sale and the local shop keeps 35%. All the local shops we have gotten into have been because we were discovered at a local makers markets by the owner. Owners often go to these types of events to scout for new product inventory.
- Other Online Wholesale Websites: We've had little success with other online wholesale websites like Handshake and Abound. But just because these websites didn't work for us doesn't mean they cant work for you.
- Cold Emailing/Applying Directly on a stores website: I hate this method, mainly because it has never worked for me. Emailing store directly of apply to be in their store on their website has resulted in zero orders. But again it never hurts to try, at best they stock your products, at worst they email you a year later with a no thank you email (looking at you Pigment)
Stepping into the world of wholesale can seem like a huge leap, but with the right knowledge and preparation, it can offer your micro business enormous growth potential. Remember, it's okay to start small and gradually work your way up. Keep your mind open, your spirit entrepreneurial, and your goals in sight, and you'll be just fine!
Please note that the information contained within this blog is intended for general informational purposes only. It does not constitute legal advice, nor is it intended to replace professional counsel. We encourage readers to consult with a qualified professional or legal advisor for specific advice tailored to their unique circumstances. Ghost Poppy assumes no responsibility for any actions taken based on the content of this blog.