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:
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.
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.
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.
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.
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.
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:
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:
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.
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.
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.
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.
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.
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:
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?
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!
Marc Vince and Yolan Williams on 15:34 7 FebThanks 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!
Marc R. Williams
Founder and Senior Managing Partner
B2B Exchange: Construction | Education & Learning Tools | Electrical | Electronics | Energy & Oil | Fashion | Fire Protection | Furniture | Going Green | Health & Beauty | Industrial | IT Hardware | Janitorial & Breakroom | Medical | Office Supplies | Pet Store | Safety | Security | Software | Sporting & Fitness | Welding