11/6/10 - 4 ways to deal with wholesale suppliers to ensure you always have stock and always make a profit

Hello!

You’ll remember that I recently talked about my multi-tasking, ultra-organised friend whose carefully laid half term plans were thrown into disarray when illness struck. I mentioned that she didn’t have a back-up plan to cover this eventuality which made things difficult for her.  

Quite rightly, I later received an email from newsletter subscriber George K who amongst other things had this to share: 

“Thanks for another great newsletter last Friday Amanda…..I’ve recently set up my own eBay business and follow your newsletters each week with interest. 

 I wanted to point out something that you didn’t mention last week which I’ve realised recently when I came unstuck with a supplier, and that is that it’s important to have a ‘Plan B’ in business especially when relying on buying wholesale stock from specific suppliers.  

My supplier was unable to fulfil my order on a recent occasion and I had nowhere else that I knew of that I could get the item in question from.  It made me realise that if a supplier goes bust or stops stocking a product I could see my whole business in ruins……It’s best to use two or three suppliers to be safe in the knowledge you can always get the stock you need when you need it.” 

That is an excellent point and is something that I’m happy to embellish on in this week’s newsletter along with some tips on how to deal with wholesale suppliers for your eBay or other online business. 

Don’t put all your eggs in one basket 

Sorry about the cliché but it’s about the only cliché that is true. There is no greater feeling than finding the perfect wholesale source for your chosen product. I still get a buzz from this, over 5 years after I started my eBay business – that lovely feeling of achievement when you’ve done your research, you’ve got a good deal on price and you know you can order in small quantities so a sample lot won’t break the bank – perfect! 

So, you place your order, pay for your goods and in a few days your parcel arrives at your door. You list your items on eBay and as you expected (because you’ve done your research) they sell out in days. You know you have a hot product on your hands that will sell over and over and you know you have a supplier who will provide you with the item for as long as you are selling it and re-ordering.  

Or have you? 

What if you go to order a second lot and your supplier has gone into liquidation? What if your supplier has closed down due to illness or retirement? What if your supplier has decided not to stock the product anymore? What if you simply can not get the product from your original supplier anymore? 

Imagine those disappointed customers. Imagine the money you could be earning but wouldn’t be due to lack of one very important thing – the product! 

Cue, huge panic! 

Yes, I won’t beat about the bush, as George says; this could be an absolute disaster for you and your eBay business which is why you should always consider purchasing stock (even the same items) from more than one supplier. Remain blinkered and you have no ‘Plan B’ if things go wrong. 

Operate in more than one niche too so that if one product or niche goes cold for a while, you have a second or third niche or product to fall back on. This way you will always be making money even if things happen to go pear-shaped for a time. 

Unfortunately, if you rely on just one supplier for all your products you leave yourself wide open to the risk of losing everything if things go wrong with that supplier. Always remember this when sourcing your products and choosing your suppliers. 

How to deal with wholesale suppliers 

I often get asked how to deal with wholesale suppliers when it comes to quantities, pricing, shipping and such-like and let’s face it, everybody at some time or another has heard those rumours of horror stories regarding wholesale suppliers that never actually supplied the goods, or only provided items of an appalling quality. Perhaps you yourself have had a bad experience in buying in bulk from a supplier, only to find the demand for your item tailing off quickly and leaving you with masses of stock left over. 

But knowing how to deal with wholesale suppliers for your eBay business will help to make your business great. No matter what your experience in dealing with suppliers, it is essential that you learn how to deal with them to ensure your eBay business grows and profits.  

I’ve put together the following important advice to help you source a great supplier, to ensure that your goods are always delivered on time and to a high standard, and to lower your costs by getting a great deal from every wholesale supplier you deal with. 

Finding a supplier 

Some of the best deals to be had from wholesale suppliers come from overseas, particularly from countries like China where goods can be produced very cheaply. I know this might be a little scary to start with, so if you have limited experience in dealing with wholesalers, it makes more sense to start locally, with a company that you know you can easily contact and meet face to face if required. 

Local wholesale suppliers can be found within your local phone book, and the internet can be used to track down other potential sources within your area. Some wholesale directories such as Esources can also be useful in finding good and reliable companies, but please be aware that some of these do cost money to join and not all directories are any good. Once you have a shortlist of potential wholesalers, you can head over to Google and search for reviews from buyers that have used the supplier in the past to ensure you are dealing with a genuine company that suits your needs. 

Getting great service 

In dealing with a supplier it is really important to establish at the outset that you are a serious buyer. If you can, use the telephone rather than email to make contact after your initial enquiry, and don’t be afraid to ask questions or confirm specifics such as the delivery date of your items. Constant communication will help your wholesale supplier realise that you are professional and won’t take missing or delayed items lying down. 

Reputable wholesale suppliers will usually offer you the option of purchasing a small selection of stock before placing a larger order. Take advantage of this, and if it isn’t advertised then be brave and ask for it. You might have to pay a little more for the goods, but a small sample will help you to be sure that you are buying a quality product. 

Bargaining for the best price 

Once you have settled on a supplier and chosen a product, it is time to agree on a price. Never underestimate your bargaining ability. The price that a wholesaler offers to you isn’t necessarily their final offer, so be ready to fight for the best deal available. To knock down the price still further you can offer to buy more products, as bulk deals certainly provide the best rates. Don’t buy more than you are confident that you can sell though, or you could end up with surplus stock sitting in your garage for months!  

It’s often easier to bargain with a supplier face to face, hence the advantage of a local provider, particularly as you get used to understanding how wholesalers work, so don’t be afraid to ask for a lower price rather than accepting the original price shown. Wholesalers want your business and are often prepared to reduce their prices but as you would expect, if you don’t ask, don’t expect them to offer! Don’t forget that the wholesalers that you are dealing with will be used to it and will expect you to drive them down. They will not think any less of you for doing so. 

There is always a deal to be done. Make sure it’s you who gets that deal! 

As always I wish you the very best of success, 

Amanda 

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© Amanda O’Brien 2010 

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