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6 Common Product Sourcing Questions Answered

by Chris Malta
Last updated 8/22/2018

If you have a question about your online business, you're probably not the first one to have it. Here are the six most common product sourcing questions we get from customers wanting to start their own online business with our answers:

1. Will suppliers care if I'm a new online retailer working from home?
Generally, no. They want to get their product out to consumers as much as possible, so they're looking to open new accounts.

2. How can I convey to a supplier that I'm a serious professional, not a fly-by-night home business?

    . Before you call or email questions to a supplier, read their web site. More often than not, the answers are right in front of you. Taking up their time with questions you could have easily found an answer to yourself reflects poorly on your professionalism.

    . When you contact a supplier - get to the point. Real wholesale suppliers are very busy people. They want to help their retailers, but they don't have a lot of time for chit-chat; so try to get to the meat of your question as quickly as possible.

    . Proofread and spell-check your emails. It's very difficult to look professional when your email is full of typos, sentence fragments and run-ons.

    . Be patient. Just because a supplier doesn't respond to your questions the same day you send them is no reason to get agitated. If they think you're going to be a demanding customer, chances are they won't work with you.

3. I found a supplier I want to work with - what's my first step?
Your first step is to check their website and read the information and then look for an online account setup form - then fill it out. Wholesalers need proof that you're a legitimate retailer before they can give you an account or access to their actual wholesale pricing structure. So step one is submitting your company information to them. You'll need a Registered Business Name and Tax ID to work with real wholesale suppliers. If you don't have one, they're easy to get: just contact your local County Clerks Office, and they'll help you get set up.

4. I only want to sell popular name brand items - how do I get a supplier?
You can't afford to limit yourself to selling only brands you recognize. Your research should predicate your product line. Many brands you've never heard of are very popular within certain demographics. Plus many large popular brands don't allow any online retailer to resell their products. They do this for brand protection as well as to keep down market flooding.

5. Should I be focusing on "hot sellers" like iPads, gaming consoles, and designer clothes? Can I drop ship them?
Once everyone knows an item is hot, the market for that item becomes saturated. The demand is there, but the supply is too. So everyone tries to undercut everyone else, and the profit margins get really slim.

Also, the manufacturers of these items set astronomical buying minimums - say $100,000 each contract term. You could mortgage your house to meet the minimum, and your wholesale prices would still be much higher than those of the big retail chains that get additional discounts for buying in much, much larger volumes.

Finding a supplier who'll drop ship these items individually is almost impossible. It's cost-prohibitive for them - especially in clothing where the return rates tend to be the highest. And again, your wholesale rate for one item won't let you compete with the larger retailers who are buying in much larger volumes.

6. There's an item I really want to sell, but I can't find a supplier who'll work with me - what now?
Keep looking. If, after you've researched, you still can't find a supplier for that particular item, don't give up altogether on having an online business - just consider other product options. There are millions of products you can sell. You have to base your product choices off your market research; but if you do that, you can find items that you can actually compete with.