Not many sellers share information about wholesale on Amazon on the Internet. However, many of them wonder whether wholesale selling is profitable. In this article, we are going to tell you how this works, how it differs from Private Label, and whether a wholesale business can be lucrative for sellers.
Let’s start with answering the question: “What does wholesale mean?”. In general, wholesalers resell products produced by other companies without changing them or adding labels, etc.
Selling wholesale on Amazon means that you buy goods from your manufacturer and resell them to consumers on Amazon.
You can sell products that you buy from a producer under their brand, not your own one. So, the answer to our first question lays beyond how to buy and sell on Amazon. The only difference is brand.
However, a wholesale license is necessary for everyone who wants to act legally. After you get a license and exercise in buying goods from manufacturers and fulfill Amazon bulk orders or customers’ orders, you will be able to scale your wholesale business on Amazon.
Keep in mind that this kind of business differs from retail arbitrage and Private Label (PL) in the following ways:
The greatest news about Amazon wholesale business is that you will sell products under an already established brand. What other pros and cons does it have? Let’s go further and find that out!
When researching products to sell them on Amazon in such a way, pay attention to those which:
In general, your ‘To Do List’ will look like this:
Let’s take a closer look at how everything works!
Look for interesting product ideas and niches while browsing categories on Amazon. Think about whether you will be able to look for cheap wholesale products for resale in these categories.
In fact, the first step is similar to what PL sellers do. Research work includes finding popular and well-sold products that fit specific criteria. Here is our article about how to research products, forecast customers’ demand for them and predict how they can be sold on the marketplace. Do the same when starting your wholesale business on Amazon.
After you have estimated average monthly sales for the product of your choice, see how many sellers work with it on Amazon. Even if there are 10 or more sellers, not all of them are competitive. Find out whether many of them sell at 2% within the buy box, which means they have the lowest price on Amazon).
When you get quotes from the manufacturer, you can calculate whether starting a wholesale business with this product will be profitable.
If your decision is positive, find manufacturers which can supply you with enough quantity of these products.
How to ensure suppliers that you are the best seller who will wholesale their products?
After you have found suppliers, you can think of who will manage your inventory - either you will do it on your own or you will pay to Amazon to participate in the FBA program.
So, as you see, Amazon wholesale business is challenging, still, you can become a wholesaler anytime you want. Even if you don’t have extensive experience in this field, don’t worry, as everyone has to start with something small. Select one product from one manufacturer and work with it, next, add one more product, and so on.
Actually, the answer to the question “How to sell wholesale on Amazon?” is not very complicated. Take our ‘To Do List’ specified above and don’t hesitate to start your wholesale business on Amazon right now!