Wholesale products are goods that you usually purchase in quantity for resale. But for a new online retailer, you need to find wholesalers with wholesale products that you can have dropshipped. Or work with wholesalers with extremely low minimum order requirements so you can afford to purchase some inventory.
Look around you! Every single product you bought from a retailer, was purchased at wholesale first.
Wholesale Product Cost
When you manufacture products, you have to calculate how much each individual item costs you to create. That is your overhead. Materials, Labor, Expenses etc. all get calculated into overhead. Then the manufacturer will add an additional percentage to each product so they can actually make a profit, keep their doors open and continue to pay employees & grow.
Cost + Percentage = Wholesale Price.
If the manufacturer doesn’t wholesale the products to retailers, and you have to work with factory authorized distributors or wholesalers then you have an additional cost. Manufacturer Cost + Percentage + Wholesalers Percentage = Secondary Wholesale Cost per item. So for retailers, it’s best to buy directly from the source whenever possible to get better wholesale prices.
Wholesale Products – Pet Blankets – Fictional Example
PetBlankiesRWe (made up business name) are (fictional) makers of soft pet blankets. They determined that it costs them approximately $5.00 to make each one and they figure that the blankets can retail for $19.99 each. So PetBlankiesRWe, will take that $5.00 and add an additional 40% for profit to get their wholesale price. $5.00 + 40% = $7.00.
Now, PetBlankiesRWe doesn’t wholesale to retailers, they have a factory authorized distributor that does. So the distributor will need to add an additional percentage on top of the manufacturer wholesale price of $7.00 to cover THEIR costs and valuable warehouse space. Let’s say they add an additional 40% on top of that too. $7.00 + 40% = $9.80
This all means that the retailer can buy the product for $9.80 from the distributor, and list the product at the manufacturer suggested retail price of $19.99. Their potential profit could be; $19.99 (MSRP) – $9.80 (wholesale cost) – 2% (average credit card processing fee) = $9.99 retailer’s starting profit.
If you are not stocking the inventory, and you are using dropshippers to fulfill the orders, then you don’t have as many overhead costs as if you had a warehouse. As a retailer though, you still need to tally in your additional costs, such as store hosting, credit card fees, labor and etc to come up with the actual profit numbers. But my example above gives you a really good idea where to start.
Where to Find Wholesale Products
With us here at WorldwideBrands.com of course! Our WBI Certified Directory of Dropshippers and Wholesalers has thousands of wholesale suppliers (most of them manufacturers) that work with online retailers. We have taken each and every supplier through a verification process to ensure they are the real deal. Our members know that each supplier in our Directory has been Certified by us to be legitimate.
We add new suppliers, brands and products every business day for our members. That means there is always something new to look at and to help avoid saturation. With thousands of suppliers at your fingertips, there is a large diversity of products for every type of online store.
Great information thanks for providing the information about wholesale online products.
Good info to consider when dealing with wholesale products… I myself sell on eBay and always look for new suppliers
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Very impressive.. Got to know many things about wholesale products. Thanks for your article.
Wow, such a nice article it is.. Thanks for sharing good info with us.
The best type of wholesale is to go direct with the manufacturer or importer!
Thanks for sharing such useful information.
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