What do wholesalers do?

What is a wholesaler and how can you make sure your small business is making the most of them to keep your buying prices low

If you are the owner of a small business, the chances are you either deal with wholesalers but know little about them, or you are trying to get hold of a wholesaler but are struggling to get information about your nearest outlet due to the relatively low profile of the trade.

This section is dedicated to the wholesaling sector, helping you to locate and deal with wholesalers and get the best value for your firm. We’ll help you work out a suitable budget and point you in the right direction on areas of wholesaling you may be unsure of, such as haggling, tax requirements and even the best time to turn up.

First, let’s cover the basics.

What are wholesalers?

Wholesalers are the vital link between the originating manufacturers and businesses at the point of sale. They offer goods in large quantities at a trade price to those who are seeking to resell the products for retail purposes rather than personal use.

Despite this, wholesalers have many similarities to the average high street shop and entrepreneurs starting a firm from scratch shouldn’t be disconcerted when approaching them to purchase in bulk.

Many budding entrepreneurs are under the impression that wholesalers are huge operations, selling goods in bulk to only large retailers. Also, despite being a important cog in the machinery of thousands of small firms, they are often frustratingly difficult to locate and can seem unapproachable to those who are new to the practice.

However, wholesalers can prove to be essesntial if you’re starting up your business. They can cut your costs by providing quality items at prices that won’t decimate your wafer thin budget. Most wholesalers are keen to build up a good rapport with their clients and can often extend generous amounts of credit to trusted entrepreneurs.

Owners who put in the effort to search for a good wholesaler, drive hard for a bargain and maintain a mutually amicable working relationship can reap substantial rewards for their business.

Numbers and types of wholesaler

Wholesalers sometimes shift around the country and the less established outlets can fall in and out of business fairly regularly. Therefore, pinning down the exact number of wholesalers in the UK can be tricky at best, guesswork at worst.

“I have over 700 wholesale suppliers listed in my membership site and this includes the majority of the main UK wholesalers,” says Richard Grady, author of the successful ebook, UK-Trader’s UK Wholesale Guide 2003. “I wouldn’t be surprised if there are more than double that number of businesses wholesaling in one form or another in the UK.”

If you are looking for a particular type of wholesaler to supply your firm, you are unlikely to be disappointed. Wholesalers, like most businesses, reflect the demand for particular goods but you can find just about any item if you are prepared to look for it.

Apart from commonplace wholesale goods such as clothing, electronic products and books, you can buy anything from pet food to ornaments.

Profit margins, and value for money, vary hugely from one product, and wholesaler, to the next. For example, firms dealing in computer equipment and DVDs may struggle to make a large profit, while those selling on giftware could double or triple the wholesale price.

Wholesalers can prove to be essential if you’re starting up your business.

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