Wholesale Information: How
to Buy at Real Wholesale Prices
Learn how you can buy
merchandise at real wholesale prices. You have to
learn how wholesale prices can vary so you can know
when you are buying at real wholesale prices and not
what the supplier wants you to believe are wholesale
prices.
Is finding products at wholesale prices difficult?
The answer is no. It’s not difficult. The difficult
part is getting them for “real” wholesale prices.
What do I mean by “real wholesale prices”? Well,
most suppliers will know in the first 20 seconds if
you are a seasoned buyer or just starting out. They
will price their merchandise accordingly.
If you are buying wholesale products to sell on
eBay, to stores or out of your home it’s all the
same to them. They will have up to 10 different
“wholesale prices” for the same items.
Even experienced buyers and large established
business pay too much on their wholesale products.
So don’t expect to know more than them when it comes
to buying at real bottom wholesale prices.
I got my first introduction into the wholesale
product pricing in one of my first wholesale
consulting gigs. I was going over the prices of
their best selling products to see the profit
margins when I was impressed with just how low the
price of merchandise was. Or so it seemed to me at
the time.
As part of my job I visited all the wholesale trade
shows around the country comparing prices. This is
when I noticed large discrepancies in pricing for
the same exact items.
Walking from booth to booth I was looking for a list
of about 500 items in just a few product categories
including small electronics, sunglasses, house
wares, tools and toys. We needed anywhere from 50 to
100 different products from each category.
After some walking and more walking I found the
exact same products with the same brands in
different booths. The products were the same but the
prices were much different, more than double, as
much as 150% more in one booth compared to another,
in the same trade show, sometimes the booths no more
than 100 feet apart.
This was a shock to me. I thought prices would only
range by 3% or a few cents. I was very wrong. Later
I found out that only a few people are really
manufacturers or buy direct from manufacturers.
Fewer suppliers are real importers of products. Most
buy from wholesalers themselves and then resell the
products to other wholesalers or retailers.
Later on, when I visited current suppliers of my
customer I renegotiated prices and told him I knew
the “other” suppliers’ prices. After a few meetings
I managed to lower prices by as much as 50%. Now, to
give you a good perspective, my customer had been
purchasing from these suppliers for 12 years and
with these new prices his profit doubled. Needless
to say my customer was very happy and very
surprised.
Here are some tips and techniques you can apply
immediately to lower your wholesale purchasing
prices.
Get to the source: What does this mean? It means you
should know who the original source is for the
products you are buying, especially if those
products are not name brand items. For example, if
you are buying t-shirts you should know who makes
the t-shirts and where, who imports them, who prints
the design if they have one, what is the material
and who is selling it and where. Don’t just buy
1,000 t-shirts because they tell you they are “good
sellers”. Make sure you know where they come from.
Even if you are buying closeouts you have to make
sure who else sells them and who is the source. I’ve
bought and sold a lot of closeouts in my time and
let me tell you, they are closeouts for a reason.
Even popular closeout websites that claim they are
selling closeouts or liquidations are expensive. I
check out their prices often and they are usually
wholesalers selling products for a good profit.
Knowledge will be the key to your products. If you
know what you are buying and the real prices of
production, transportation, warehousing you will be
able to negotiate with your suppliers. If you don’t,
you will usually pay up to 150% more for the same
items that others are buying in the same quantities.
Here are 5 questions that you can ask your wholesale
supplier that will help you determine the right
wholesale price:
1. What is the real retail price of the item and
where does it sell for that price?
2. Who is selling it to those Retail Stores and how
much profit does the store make and their supplier?
This will give you an idea of how much the store
pays and how much the store supplier pays.
3. What is the price per case, per pallet and per
truckload? This will give you an idea of their best
pricing.
4. Who is your best customer? How much do they buy
per month? This will tell you who gets the best
price for the product.
5. Do you manufacture or import this product? This
will tell you if they are the original source for
the product or, if, like you, they are a wholesaler
or distributor.
Jorge Olson is a consultant,
speaker and entrepreneur and owns several Wholesale
Distribution companies. Visit his consulting website
at
http://www.DistributionBiz.com His latest
Website teaches you step by step how to get started
and make money in Wholesale Distribution. You can
find it at
http://www.WholesaleTeacher.com
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