Ever wondered why your competitors always seem to be able to sell the same items at a couple of bucks cheaper than you? They must be doing something differently, huh? Yep, that's right, they are getting a better wholesale price which means they can make more sales and make more profit. So how can you get access to those same great wholesale prices?
1. Order in bulk
Yes, we understand that it is hard for new sellers to do this as it requires a large investment, but when you can, it really ramps up your sales as you can buy so cheaply per unit, so this is definitely something you should be aiming for. So what exactly is a bulk order? Usually a heavy bulk lot will cost over US$1,000, depending on the items. For example, if you are buying single items which wholesale at around $100 each, then $1,000 won't be considered a bulk order and you won't be getting the very best price possible. However, if you are buying an item which is listed by your supplier at around $3 per item, then $1,000 worth should get you a good deal.
2. Build a relationship with your supplier
Top sellers with rock-bottom prices understand the importance of putting a great deal of time and energy into product sourcing and finding the very best suppliers. It's a good idea for new sellers to really try and build a relationship with their suppliers. Do this by calling them regularly and talking with them about new products that have come in, or that are about to. Don't be afraid to talk with them about your future goals, e.g plans to order in huge bulk from them. This will help to show them that you are committed to forming and maintaining a strong business relationship with them now, and in the future.
Most suppliers will highly value your business, even if it only comes in small, scarce amounts as this is how 99% percent of online retailers start out and they appreciate that eventually, you should become a larger and more steady customer for them. For this reason, many suppliers will do their bit to get to know, and even schmooze you to make sure you will be loyal to them in the future. Take advantage of any gestures they offer and use any time they give you as an opportunity to get to know you by telling them all about yourself, your family, your vision for your business and goals for the near future. Getting to know each other on a personal level is truly the most important thing you can do to help secure a better relationship for the future.
3. Make a special effort with overseas suppliers
If you are dealing with an overseas supplier, you may have to deal with a language barrier which can slow the process of getting friendly down, but don't give up! Try sending your supplier a few local treats such as candy which would not be available to them in their country. Perhaps include some written information about you and your business as some non-native speakers can often read much better than they can converse.
4. Get as close to the source as possible
This means buying directly from the manufacturer! By going direct to the source, you cut out the middle men (wholesalers) and really find the best prices possible. Be aware that when you buy from the manufacturer, you will be expected to buy in huge bulk - at least 1,000 units per order so you will need to be prepared for this, both financially and practically by having a storage unit and transport for your shipment arranged.
When you approach a supplier, you will need to do some negotiating. Before you begin in this often long and awkward process, know exactly what your breaking point will be. This is the highest possible price you can pay the manufacturer while still turning a profit. For more information on negotiating, check out this guide.
Hot negotiating tip: If you can, have your business partner (if you have one) do the negotiating. It's always good to have someone other than the person who is trying to build the relationship do the dirty work of trying to get a very low price. Some larger manufacturers will already have an employee assigned to this task for this very reason.
So there you have it, the secrets to getting the best possible prices unlocked and ready for you to take advantage of!