As any good retailer knows, the secret to profits is finding quality products at a low price. From there, you can increase the margins and let your profits roll in. But where can you find these affordable products.
“For the vast majority of retail entrepreneurs, the main source of products will be a factory-authorized wholesale supplier,” an Entrepreneur article says. You also have the following options.
One of the most common sources for cheap wholesale products is liquidation auctions. Essentially, this is typically an auction in which a company sells its assets to the highest bidder. In some cases, the sales occur because a company went out of business. In others, it’s the result of returned inventory that couldn’t go back on the shelf.
The benefit of attending these auctions is that you’ll get a chance to buy high-quality products at ridiculously low prices. The downside is that you can’t be overly selective in choosing which products you get. You’ll take whatever they have at auction with minimal concern for brand loyalty.
This type of acquisition is best for retailers that don’t mind selling a variety of brands and goods. You might specialize in one type of item, such as cellphones or clothing, but you don’t care which brands you feature on your website.
The biggest benefit is the price factor. “A nice thing about auctions is the control attendees have in terms of item prices,” a SlideShare presentation by Auction Systems says. “Everything is negotiable in an auction from start to finish. Since bidders determine the price of an item, good deals are quite common.”
It’s important to note that items are sold as-is and you can’t return them. There’s also no liability protection from the manufacturers, so there are risks. However, you can always add disclosures to your product pages and carefully inspect items before bidding to minimize your risk of losses.
Manufacturer and distributor wholesaling
Although these sales aren’t quite as satisfying as full pallets of goodies found at liquidation auctions, you can get good prices on products if you buy wholesale directly from the manufacturer or distributor. You usually have to purchase very large quantities, and the return policies and guarantees might not be as good as if you had purchased them through traditional channels.
If you can, try to get wholesale products from the manufacturer. Distributors can have good sales too, but the prices are usually a little higher because products go through a few more steps to get to the distributor. However, they’ll often throw in free freight if you order enough, which can equate to fantastic savings.
Use your resources
You aren’t alone in your race to find great retail products at wholesale products, so reach out and see what others have to say about it on the web.
“Retailers can often find products to sell in their stores by searching online, joining buying groups, using library resources, and attending trade shows or buyers’ markets,” an article from The Balance says. “A trade show is one of the best places to find a wholesaler. Retailers can find many suppliers serving the same markets with a range of product offerings.”
The article highlights California and Las Vegas as having some of the best trade shows for retailers each year. You’ll typically develop more contacts and find more resources for buying cheap products the longer you’ve been in business.
Finding wholesale products for cheap is a fantastic strategy for those who want to make good money without worrying about cutting-edge products. Your target market is the budget-conscious who don’t mind buying products without guarantees. By keeping your overhead low and researching the best products to purchase, your retail business will thrive.