What are trade references and when do I need them? This is a question we have gotten recently from some members because we have listed wholesale suppliers that will, on occasion, ask for them. 

What are Trade References?

Trade references are who you have purchased from in the past, or recently, for something similar. Like wholesale products from another wholesale supplier or distributor.

When supplying a Trade Reference, you would provide a telephone number, email address and the mailing address of a contact at that prior company. This will allow the wholesale supplier who is asking to reach out and contact those businesses you have purchased from.

Why do they need them?

When you ask a genuine wholesale supplier for an account with credit terms, the wholesaler typically asks you for Trade References.  This is all in an effort to determine your payment history and credit worthiness. 

Now, a new business simply will not have any prior credit history.  Don’t worry! It’s ok! That will not immediately deny you from having a dealer account with that wholesale supplier. But you usually cannot buy on credit terms. Like pay every 30 days.

You will have to pay for the products up front or using your credit card until you have built up a good credit history with your wholesale supplier. 

But guess what?!? That wholesale supplier then becomes a Trade Reference for you! (provided you have a good payment history with that wholesale supplier of course)

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Before You Contact A Wholesale Supplier:
Don’t assume that all wholesale suppliers are willing to work with online retailers.  You might think that because they want to sell products, that they would welcome you as a new sales channel. But they don’t!