10 Tips for Finding a Wholesale Distributor
Online Searches and Good Communication Are Key
Are you interested in finding a wholesale distributor or drop shipper for your bricks and mortar retail business or online e-commerce store?
It's easier to find a wholesale supplier if you know exactly which products you need. If you already know what you want to sell, here are 10 tips for finding a wholesale distributor for your business.
1. Understand Your Industry's Distribution Channels
There are many ways a product can go from manufacturer to retailer. Not all wholesalers serve the same market. Understanding your industry's distribution channels, and knowing where you fit in the supply chain can help you find the right wholesale supplier for your retail or online business. Different types of wholesalers include:
- Manufacturer: For some products, you can buy directly from the manufacturer. This is basically what a "boutique" store does — buys from small (sometimes one person) manufacturers.
- Importer/Exclusive Distributor: In some industries, a company might have the sole rights to import and distribute a product in a certain country. Some may sell directly to retailers, but more often, they set up or sell to smaller local wholesalers.
- Wholesaler/Regional Distributor: There are usually regional wholesalers who take delivery of boxcar-sized lots, break them down and sell truckload boxes of products to local wholesalers.
- Jobbers, "wagon peddlers": These individuals make daily deliveries to local grocers and retail brick-and-mortar stores.
Each product industry has its own unique distribution channels. Some retailers will move enough volume to bypass jobbers, or maybe in a smaller industry, importers sell directly to retailers.
When you first start, you'll be buying from the smaller wholesalers at higher prices. As your volume increases, you'll be able to get better pricing and/or move up the supply ladder to a bigger wholesaler.
2. Try the Manufacturer First
You might as well start at the source. If you're selling branded items, go directly to the manufacturer of the product. They might sell to you depending on their minimum order requirements.
If you're too small for them or they only sell through established distribution channels, ask them for a list of distributors you can contact. By starting at the source (the manufacturer), you can either get the lowest prices or at least get a list of the most reputable distributors to kick off your search.
The fewer people you have to go through, the lower your cost will be, allowing you to be more competitive in the marketplace. Also, you'll certainly want to get a sample of the product you intend to sell to make sure ensure it's high quality.
3. Have a Productive First Contact With a Wholesale Supplier
Take the list of wholesale distributors you got from the manufacturer, and start contacting each one. What you're looking for are minimum order requirements and their wholesale unit prices. To get the best responses, be honest about what you're looking for (don't try to sound "bigger" than you are), keep your emails short and to the point, and be friendly.
You may also consider picking up the phone to make initial outreach calls or to follow up with the people you've sent your introductory emails to as well. It can't hurt to let them know you are doing research and looking at other competitors as well; this can help you get better prices, even if you are starting out small.
4. Try Searching for Wholesalers on Google
As mentioned above, you can start your preliminary research with some basic Google search terms. As you get deeper into your research, you'll probably get more specific about the products you're seeking.
Conduct Google searches for the words "wholesale" or "distributor," plus some keywords from your products or niche. Try product names, model numbers and brand names. Go through each result and look for the "wholesale account" link or an email address or phone number where you can get more information. In the rare case that the information is difficult to find or not readily available, you could do a WHOIS search to find the website's contact information. Again, the more potential wholesalers you find the better you'll be able to comparison shop and get a feel for what normal industry prices are, as well as get competitive quotes.
5. Look for Wholesale Lots on eBay
If all else fails, some retailers or small wholesalers will sell lots of your product on eBay.
Since eBay mainly targets retail consumers, the wholesale options you'll find here are usually only suitable for very low volume retailers. But if you're just starting out, eBay might be the easy start you need to dip your toes into e-commerce and start shipping product. It's also possible that the people who are selling direct to consumer on eBay also have a business-to-business side of their business as well. It's easy to make contact with them on eBay to find out if that's the case.
6. Check Major B2B Marketplaces
Start at Alibaba.com; it's the 800-pound gorilla B2B marketplace of manufacturers, importers and wholesale distributors. Other B2B marketplaces include Global Sources (USA), Buyer Zone (USA), EC21 (Korea), EC Plaza (Korea) and Busy Trade (Hong Kong).
Always look at multiple sources when considering wholesale distributors.
7. Join Industry Groups, Forums, and Other Professional Networks
Other retailers are not eager to share supplier information with competitors, so it'll take some networking to find the best possible wholesale suppliers for your small business. Start building relationships with industry insiders, and eventually, you'll be one of those insiders. Participate in online forums, these can be a great source of free information and help from other people with experience in this market. You can also build your LinkedIn profile and start building connections, subscribe to industry newsletters, and generally build your professional network.
8. Subscribe to All of Your Industry's Trade Publications
Get every magazine or newsletter that targets retailers in your industry. Every advertiser in the magazine will be a product manufacturer or distributor looking to reach you. You should have a few dozen options from the ads in the back of the magazine. Also, subscribe to all of the online newsletters, blogs, and other sources of information available to you.
This is one of the best ways to keep up with industry news, updates, and important things you need to know as it relates to your industry.
9. Attend a Trade Show
Attending trade shows is one of the most powerful ways to build and grow your business. These events are for retailers just like you. When you can talk face-to-face with manufacturers and wholesale distributors, it avoids all of the noise of inaccurate information that can plague the web.
The largest directory of trade shows is at tsnn.com. You can search for a trade show by industry, date, city, state or country and/or event name.
10. Don't Be Afraid to Make a Mistake
Your first wholesale supplier may not be your lifelong vendor. Creating your perfect supply chain is an evolution involving a lot of trial and error.
Remember, all you need from your first supplier is a product that you can ship at a profit. It may not be the best wholesale price for you, but don't sweat that in the beginning.
Your first goal is to ship a product. Then you can improve your bottom line by trying other wholesale suppliers as you continue to build and grow your business.