Own Small Business? Your guide to buy wholesale products

Today, the digital world encompasses nearly every facet of our life and the ability to find rewarding business models is no more restricted to a handful of people. Nevertheless, you need business acumen and the ability to carry out due diligence before embarking on any venture to safeguard your personal and financial interests.

Buying wholesale products
At some point in time, certain businesses decide to liquidate their stock. This can happen due to a variety of reasons. But, the major drivers are either the business itself winding up, discontinuing a particular line of products, or the business changing course. But, irrespective of the reasons that compel a business to dispose of their stock, it presents an opportunity for some people to pick up these stocks and resell it in the market for a profit. On that note, here is a short guide to help you through the process.

Learn focused research

Before jump starting the business of buying wholesale products, invest in quality time understanding the product and its acceptance among the consumers. What category do the products fall into, are they fast moving daily needs, slow moving consumer goods such as electronic products, or apparels/clothing etc. Determine the means of selling the goods in the retail sector. Here again, you can do mock trades by offering the wholesale goods you identify to retailers and eliciting the response.

Understand the costs
Buying wholesale and selling retail has its costs. All types of goods you buy on wholesale may not be saleable. Therefore, you may need to unpack the goods, sort them out, and perhaps even repack them. Consider the cost element, including disposing of what could be junk. Similarly, depending on the volume and nature of goods, you may need additional help selling the goods and there is a cost incidence. After adding up all these costs, does it leave you with a reasonable profit?

Some advantages with closing down sale/ discontinued sale stocks
If you focus on closing down sale/discontinued sale stocks to buy in wholesale, you may have some specific advantages. But, before you jump into it, you must learn why the brand is closing down or discontinuing a particular line of products. In some instances, particularly consumer durables, apparels, you may still get good quality goods that still command value. For example, apparels with a brand value may be saleable in semi-urban markets than the urban markets when a business is moving out of a line of products or closing down.

Ask your questions up front
In buying wholesale products and reselling them, you are investing a fair amount of money and often, business credit may not be available. Therefore, before putting your foot forward, have a set of well-researched questions ready for the seller. Get all the answers and consider whether you are on solid ground or marshy land.

Statutory requirements
There are always some statutory requirements before you can get into a business. Understand what applies to your business and arrange proper compliance before you get started. You can always find a professional help to walk you through these and get the paper work done.

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