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Why do suppliers ask for specific documents before I order?

Has a supplier refused to even give you a quote unless you show them your tax ID?

Don't be surprised—it's totally normal.

One of the most common questions new sellers ask us is, “Why does the supplier want X document before I order?”

We understand. For many new sellers, it's hard to know whether these suppliers are for real or if you're just being sucked into a scam. But don't worry—if you are ordering from a supplier on SaleHoo, you can rest assured they have already been vetted.

It's actually very common for suppliers and wholesalers to ask for certain documents from their buyers (i.e., you) before they will sell to you. So that brings us to the first question:

What documents do suppliers ask for?

Depending on where you and your supplier are located, the documentation they need may vary. We've put together this list to give you a better idea of what to expect.

Even if you're new to the business, don't let paperwork overwhelm you. These documents are not hard to acquire, and we've linked to some resources below to help you get started.

1. Tax ID

If you are a US or Canadian resident buying from a US or Canadian wholesaler, you will usually have to provide a tax ID. This is a government-provided number (similar to a social security number) that allows you to charge sales tax on your purchases. For more information, be sure to check out our article on how to get a tax ID. If you are not a US/Canadian resident, or if you are purchasing from an overseas supplier, they may not need your tax ID.

2. Company certificate / business registration information

If you're not doing business in the USA or Canada, you may still need to provide business registration information to your wholesalers—locally and even overseas. In most countries, this is not a difficult process and usually involves registering yourself as a legal business with your state or federal business registry.

In many countries, when you register a business, you will also receive a company certificate or a certificate of incorporation. Suppliers may ask to see this certificate as well.

3. Reseller's permit/license

If you are a US resident, another document suppliers may request is your reseller permit/license. This is basically a license that exempts you from paying sales tax because you pass this tax on to your customers. Sound good? Here's how you can get your reseller's license.

4. VAT number

If you are doing business in the UK or in Europe, your suppliers may often ask for your VAT registration number. VAT is a tax levied on sale of goods in the UK and Europe. While VAT is applicable in most of the EU, the rules vary from country to country. Read more about what's required and how to register for VAT in your country here.

5. Credit card photocopy

A photocopy of your credit card often serves as proof of your identity and also proof of your ability to pay. Suppliers often ask to see a photocopy to verify you are a legitimate buyer. If you're unsure about providing your credit card numbers to a supplier, you can always get a reloadable card online. It's a more secure option.

So now you know which documents to prepare for your suppliers. But there's a still an important question that remains unanswered:

Why do suppliers need these documents?

Suppliers are trying to run a business the same way you are. The business of providing someone with goods can be a risky one, so they want to make sure they're working with the right people.

There may be a variety of reasons why your supplier wants to see paperwork before they even give you a quote. Here are some explanations:

1. As proof of identification

Suppliers want to make sure you are who you say you are. By providing them with your business information or a photocopy of your credit card, you show them they are dealing with a real person.

2. To make sure you're a serious business

Suppliers want to make sure they are dealing with someone who is serious about their business. They want to know you will really make a purchase and aren't just getting a quote with no real business plan in mind. Having the right paperwork or information, such as a tax ID or business registration information, proves you're ready to dive in, and aren't just testing the waters.

3. To process orders faster

Sometimes suppliers may need certain documents to make sure the process moves faster and the goods get to you sooner rather than later. So if an overseas supplier asks you for your business registration number, don't panic. They may need to add it to the invoice to avoid delays at customs.

4. Because they may need to charge sales tax

As a US resident, if you don't have a valid reseller's license, your supplier may need to charge you sales tax before they sell you the goods. They will ask to see a reseller's permit to check where they stand.

5. To verify they are not dealing with the public

Suppliers will sometimes use the paperwork as a way to verify they are not dealing with the general public, i.e., someone who is just trying to get their hands on the goods at a cheaper rate or tax-free.

6. For easy customs clearance

Overseas suppliers may sometimes surprise you by asking for documents as well. This usually happens when they need them to avoid issues at customs—which could slow your products down once they arrive in your country. Depending on your country's requirements, you may need to provide such information as your business registration number or your VAT number to be able to legally import the goods.

OK, so you get why suppliers are so insistent about these documents, but you probably have just one more question:

Can you still purchase products without all the paperwork?

Well, kind of.

Some suppliers and wholesalers may sell you their products without requiring any paperwork at all. If you are dealing with overseas suppliers, it may be possible to get away with never registering your business or acquiring a tax ID.

But here's the thing. None of these numbers or IDs are hard to get. If you check out the resources we've linked to above, you will see that it's just a matter of following a few steps.

If you're planning to take this selling business seriously, we highly recommend registering your business or acquiring a tax ID and reseller's license (whatever is relevant to your situation). Why?

  • Most suppliers WILL ask for some form of documentation. By dealing only with suppliers who don't want to see your business info, you're limiting yourself to a smaller pool.
  • If you're doing business with domestic suppliers, they often need your information for tax purposes. Whether it's a reseller's permit or a VAT number, you would unnecessarily complicate the process by not providing this information.
  • Some suppliers won't even let you get a quote if you don't provide them with the information they ask for.
  • Worse, some may decide to charge you more because your lack of information shows them you're not a serious enough buyer.

Set up your business the right way and you should have absolutely no trouble ordering from suppliers. If you're interested in setting up a US-based business from overseas, check out Stripe Atlas—a great option for incorporating a US company, setting up a US bank account and accepting payments from around the world.

Documentation and business go hand in hand, but don't become overwhelmed. Here's a quick guide on what you need and where to get it:

  What you need Where to get it
1 Tax ID State/local government (USA)
2 Business registration information State/federal business registry (USA)
3 Reseller's license State tax department (USA)
4 VAT identification number National VAT registry (UK/EU)
5 Secure credit card number US Unlocked

Don't let a few documents hold you back from selling online.

Getting yourself set up with the right paperwork is usually just a one-time process. Once everything is in order, you're going to have no trouble getting quotes and ordering products from suppliers, domestically and overseas. Just look at it as the new seller's rite of passage.

Got a question we haven't answered? Don't be afraid to ask—we're here to help!

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4 Comments Add your comment
Full Member
Thanks Richelle for a very well outlined, succinct guide to doing business with a wholesaler. After 25 years in business as a wholesaler, this information is critical to EnRoute Global's operations for a few reasons:

1) Our Reputation: EnRoute Global has nearly 2,200 Resellers in 43 countries, but also has a government practice. As such, our Reseller Community is an extension our larger organization. For each Reseller application, we thoroughly vet the information Richelle mentioned above along with verifying online activity of the prospective Reseller - to ensure positive online and offline interactions.

2) Our Legal and Compliance Requirements: EnRoute Global has internal compliance requirements that must be met, along with local, state, federal and international requirements. We then also have standards to be met by our over 3,500 manufacturer relationships. Again, our Resellers are an extension of EnRoute Global... Will you adhere to MAP Pricing, etc.

3) Our Resellers Legitimacy and Credibility: If a prospective Reseller is serious about running a legitimate business, they should explore all requirements that must be met for running a business in their local jurisdictions as well as other domains that they conduct business. Often times, many start-ups, newbies and seasoned professionals do not have the knowledge of what is required. Salehoo is a wonderful platform that proactively provides its members thought-provoking knowledge, guidance and insightful information.

EnRoute Global is happen to be a proud partner of Salehoo.

We still remain your One-Stop Shop Drop Shipper and Data Integrator - Wholesale, Bulk and Liquidations!

Best,

Marc R. Williams
Founder and Senior Managing Partner
http://EnRouteGlobal.com
 
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Free Member
Hello I'm from Mexico, I'm thinking of opening a store online, I need documents to be able to buy from suppliers Reply
Site Admin
Hi Oscar! I believe you will need to acquire an RFC--"Clave en el Registro Federal de Contribuyentes." You should be able to find all the info you need on this documentation on .gob.mx websites. :-) Reply
I live in a country where there is no taxation at all (an offshore tax haven), so we have no tax system, no national IS or tax numbers, no need to register as businesses because there is no tax. People work I suppose as 'self employed' or sole traders and we have no documentation at all. Hell, we don't even have a postal delivery system so no one has even a bank statement with their home address - all mail is picked up at the post office.
I'm seriously thinking no one will want to deal with me even though everything is completely legitimate, just completely without documentation or legislation. Reply
Site Admin
Hi Susan! I wouldn't let that discourage you from contacting suppliers. It's very different to be somebody in a country that requires a lot of paperwork applying with no documentation, and somebody in a country that doesn't require any paperwork applying after jumping through all the necessary hoops (that is to say, none at all).

Some businesses will probably be wary of working with you, but I'm sure many of them will be more than happy to sell to you. Reply
Hola, yo vivo en Venezuela, actualmente estoy en Chile, la idea del comercio electronico tiene mucho tiempo rondando entre mis proyectos, Necesito alguna documentacion para comprar a los proveedores en USA? los productos se venderian dentro de los USA. Ustedes tienen un listado de proveedores que trabajen con compradores extranjeros y que sean amigables con la documentacion solicitada? Reply
Site Admin
Hi Luis! The documentation you need will depend on the country your business is currently located in. It sounds like you would want to register a business in Venezuela, unless you plan to mainly operate in Chile. (Chile is supposed to be an easier place to do business, but you should always avoid dealing with tax codes for two different countries whenever possible.) Check government websites for the country you want to get set up in and register your business to get the paperwork necessary to start working with suppliers.

We have plenty of suppliers willing to work with customers located outside the U.S., but you’ll want to get your hands on some American payment methods such as a U.S.-based credit card to overcome worries about payment getting through. This article helps with that and other issues with selling inside the U.S. when you live outside of it: https://www.salehoo.com/blog/how-to-sell-successfully-from-smaller-countries Reply
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