Wholesale Distributor

Written by Ava Grzegorczyk
Bookmark and Share

Why Use a Wholesale Distributor?

Whether you're new to the world of online selling or an old pro, or even if you sell from a traditional retail outlet, you will have to purchase inventory at some point in your sales process. For a traditional retailer, that point is obviously well before the sale because shelves have to be stocked with goods to be purchased by customers who walk in. For an online vendor, the point may not even occur before s/he makes the sale.

Here's how using a wholesale distributor works for an online vendor. The vendor sets up a website, establishes an online payment method, and determines what types of products to sell. At that point, the vendor must find a source for the products, and a wholesaler is the obvious choice. In the world of online sales, a wholesaler can often offer a vendor tens of thousands of products at extremely low rates. Still, the vendor may not have the capital to purchase a substantial inventory or the warehouse space in which to store it.

Wholesale Distributor Advantages

Online vendors often use wholesalers as dropshippers. These arrangements allow the vendor to sell his/her products online and collect the money before even buying the products from the wholesaler. As soon as the vendor has the customer's money in hand, the vendor contacts the wholesaler by a pre-arranged method. The wholesaler then packs and ships the item or items directly to the vendor's customer.

Sending a package directly to the end user is different from what most wholesalers do. The majority of wholesalers send bulk shipments to retail outlets such as stores. In the case of dropshippers, the buyer is the online vendor who has already sold the product. The dropshipper even ships the products in the vendor's packaging and includes the vendor's packing slip. This process allows the vendor to retain more of his/her capital for marketing and sales pursuits.

Bookmark and Share