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What to Think About When Starting a Wholesale Business

What to Think About When Starting a Wholesale Business

It is no secret that starting a business is a challenging task that requires a lot of time and effort to try to get established. Wholesale businesses are slightly different compared to a normal business where, for example, people might create and sell their own products/services. There are many things to consider when starting a wholesale business, so to that end this article discusses what a wholesaler is, what kind of products are ideal to sell, and the pros and cons of owing a wholesale company.

What is a Wholesaler? 

Essentially, a wholesaler is a distributor that sells large quantities of goods at low prices to retailers, service providers, and manufacturers. They buy products in bulk directly from a manufacturer and sell them on to the above mentioned entities (essentially on a business-to-business level). As wholesalers sell their goods to retailers, etc., it means they very rarely deal with consumers directly.

What Kind of Products do Wholesalers Sell? 

Regarding the types of products that a wholesaler could sell, there are a wide range of items available that will be ideal for bulk-selling. The good folk at Olympic Eyewear say that it is crucial to research the various products to find out things such as what is high in demand and what has the potential to make a good profit before settling on what to sell. Clothing and accessories, like bulk designer sunglasses and homeware for example sell in high volumes and are ever increasing in popularity.

Pros and Cons of Wholesale Businesses

There are advantages and disadvantages when it comes to wholesale businesses. Firstly, wholesalers tend to receive discounts when purchasing products from manufacturers due to the enormous quantity of goods they usually buy. This reduces the per-unit cost of the items being bought and thus increases their potential profit margins. Another advantage of running a wholesale business is that as the products tend to be purchased by retailers, money does not need to be spent on advertising and marketing products directly to customers. Lastly, wholesale businesses usually have better control of their inventory. You can identify all your stock and know exactly what has been shipped, packaged, and delivered, which leaves less room for error.  

Unfortunately, like many other businesses, there are some downsides to owning a wholesale company. Due to the immense volume of products that are being sold, wholesalers will need to spend a lot of money on finding appropriate storage spaces. This will obviously affect their profit margins and add to spending costs. Additionally, there is always an increased risk of loss as such a large inventory is being held in the said storage spaces. If, for instance, a flood or a fire were to occur, then this could cause severe damage to inventory and result in a significant loss for the business (some of which may or may not be covered by insurance). 


In summary, there are a number of things to think about before starting up a wholesale business. You need to fully understand what it means to be a wholesaler and what it actually entails. As well as this, it is essential that you research and choose trending products that are expected to bring in a good amount of money for the company, such as homeware or clothing goods. It is important to think about the pros and cons of wholesale businesses prior to starting your new venture, which includes discounts on products and spending costs for storage areas. Evidently, not all companies become a success, so it is crucial that a lot of time and effort is put into making your wholesale business stand out.