Everything you Need to Know About how to Buy Wholesale (2023)

When you start a retail business, one of the first things to figure out is where you’re going to find products to sell. This might mean buying from wholesalers.

Most retailers don’t make their own merchandise. Instead, they get their products from wholesalers. Not only are wholesalers great sources of merchandise, but as your business grows and evolves, they’re flexible enough to support you along the way.

Buying wholesale can seem a little mysterious at first, which is why we’re sharing our tips to help you get started, how to find wholesalers and how to get wholesale prices. We’ve been helping retailers do better business for over a decade.

  • What is buying wholesale?
  • How to find a wholesaler
  • How to choose a wholesaler
  • How to buy in bulk for wholesale
  • What are some additional factors to consider when buying wholesale?

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Everything you Need to Know About how to Buy Wholesale (1)

What is buying wholesale?

Have you ever wondered where do businesses buy their products? Buying retail and wholesale are two different things. When you buy merchandise from a wholesaler, you’re shopping from the middleman between your retail store and the manufacturer. A wholesale purchase is almost always made in bulk, and because of that, you pay a discounted price for the purchase.

After you buy products from a wholesaler, you can then sell them at your own store at a higher price to make a profit. This higher price is called the retail price, and it’s what customers will pay when they shop in your store. Customers are willing to pay the higher price because the retailer takes on the cost and logistics of buying and storing wholesale items (and delivering excellent customer service).

The difference between the retail and the wholesale prices is called the margin. It’s the amount of profit that a retailer gets from a sale. The retail price typically varies between businesses, and there are a few different pricing strategies that can be used to determine the best retail price for you. Once you do this, you can then determine your gross profit.

How do I price wholesale items for resale?

Gross Profit = Revenue – Cost of Goods Sold (COGS)

In the above formula, revenue is equal to the retail price you charge to your customers. COGS is a high-level metric that covers all of the variable costs associated with producing and selling goods. Fixed costs are not accounted for in gross profit calculations. For the sake of simplicity, since you’re buying from a wholesaler instead of producing a product yourself, you can estimate that your COGS is the price you pay for a product.

This means that gross profit is the amount of money you make off of a sale. Retailers typically “markup” or raise the price of goods they bought wholesale so that they can make a profit. A good example is buying a t-shirt at a wholesale price of $2 and then selling the shirt in your store for $10.

In this case, the markup is $8, and gross profit of that sale is $8. Keep this in mind when buying inventory for your store. If your wholesaler’s prices are too high, it will affect the overall profitability of your business.


Likewise, the prices you offer your customers have to be consistent with the market you’re in. It’s easier than ever for customers to find alternatives online or in other stores. Pricing is one of the ways you can stay competitive and retain customer loyalty.

Pricing matters for wholesalers as well, and many will have a minimum order requirement set before you can do business. A minimum order is the minimum amount of products a retailer can purchase from a wholesaler to do business. Wholesalers set these minimums in order to hit their revenue and profitability targets.

Since you’ll need to order products in larger quantities to meet the minimum order requirements, it’s a good idea to order your top-selling items from wholesalers. You should be able to use your POS system to easily spot your best sellers and see what’s most profitable.

Can I buy wholesale from a manufacturer?

Generally, a product goes through multiple hands before it ends up on retail shelves:

  • The manufacturer creates the products
  • The distributor facilitates sales between the manufacturer and the wholesaler, and sometimes between the manufacturer and retailers
  • The wholesaler works with the distributor to buy in bulk
  • The retailer buys smaller quantities of the items from the wholesaler (or distributor) to sell individual goods to consumers

Some manufacturers are also distributors and wholesalers; in this case, you’d buy wholesale items directly from the manufacturer. Apple and Nike, for example, produce their own goods that are then sold in bulk to retailers (and also sold directly to consumers in their stores).

Generally, though, a retailer will go through a wholesaler or a B2B wholesale marketplace to get goods. This is because manufacturers typically focus their budgets on manufacturing, not on marketing—that’s what distributors and wholesalers are for.

How to find a wholesaler

There are several ways to find a wholesaler. You can approach wholesalers or distributors individually, or you can work with a B2B wholesale marketplace to streamline the process.

What are the types of wholesalers?

Wholesalers aren’t one-size-fits-all. There are a range of wholesale businesses that work with retailers (and, sometimes, consumers). The type of wholesaler you work with will depend on the specific items you’re buying in bulk, the retail niche you want to fit in, the kinds of relationships you are able to build and the wholesale ordering technology you want to work with.

  • Manufacturers: some, but not all, manufacturers also act as wholesalers. Because there are less middlemen, buying directly from a manufacturer may net you lower wholesale prices. However, buying directly isn’t always available as an option—and even when it is, it isn’t always the most convenient.
  • Retail wholesalers: retail wholesalers sell products in bulk to retailers at a slight markup from manufacturers. Buying through a retail wholesaler means you can purchase wholesale items from more than one manufacturer.
  • Merchant wholesalers: as opposed to retail wholesalers, merchant wholesalers sell to both retailers and the end customer. They generally have lower minimum order sizes in light of this, and are your direct competition while also being suppliers.
  • B2B wholesale marketplaces: this is the most convenient option. Wholesalers and brands come together on B2B wholesale marketplaces like NuORDER, where retailers can browse and order products much more efficiently than the traditional email-and-purchase-order format.

Where to buy wholesale products

Searching for wholesale items online can be a gamble. Not all aggregate sites thoroughly vet their wholesalers, and not all legitimate wholesalers have high-ranking or well-designed sites. You don’t always know if you can trust someone on some of the big marketplaces.

To look for legitimate wholesalers, your local chamber of commerce is often a good place to start. If you’re in touch with other business owners, crowdsourcing from your network is another great way to get info on which wholesalers you should look into and which ones you should avoid.

For trustworthy wholesalers online, try a B2B wholesale marketplace with strict standards for brands. B2B marketplaces make it easier to find wholesale items, as you’ll be able to browse catalogs online.

How to choose a wholesaler

Once you’ve compiled a list of wholesalers you’re interested in, Google them and read online reviews from other retailers who have worked with them. That will give you a good sense of whether or not they’re worth reaching out to.

After you’ve narrowed your list down to your top choices, here is a list of must-ask questions when choosing a wholesaler:

What merchandise do you sell?

If you’re selling a wide range of items or if you plan on keeping your store very specific, you have to choose wholesale partners that carry the products you need. You can work with as many different wholesalers as you need to in order to get the inventory you want. However, make sure that the kind of merchandise these wholesalers offer aligns with the kind of store you run so your brand is consistent.

What is your price point?

You’re selling the merchandise you bought from the wholesaler in order to make a profit. When choosing a supplier, make sure you can get pricing that allows you to hit your desired profit margins.

Is the wholesaler reliable?

Don’t work with people you can’t rely on. Wholesalers who deliver merchandise late, not at all or consistently show up with damaged goods aren’t good for business.

Do they have great customer service?

Make sure any company you work with has a reliable customer service team you can easily reach when needed. If you have to jump through hoops to have your questions answered or their customer service is never around when you need them, you may need a new wholesale partner.

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How much do they know about the product?

The wholesale partner you choose should have a strong understanding of the products they sell. Not only can you share that information with your customers, but it also gives you the chance to make sure you know you have a partner who stands by the quality and performance of what they’re selling.

Wholesalers who can’t answer your questions about their product may be aware their merchandise isn’t the best, or a lack of knowledge may mean they just don’t care. Either way, a good business partner will be able to answer your questions adequately.

Can they help you drop ship?

If you sell products online, it might be worth asking if your wholesalers can help you drop ship. Drop shipping is a fulfillment method where the wholesaler stores your inventory and handles your shipping.

When someone places an order from your eCommerce store, you pass on their order information to your wholesaler, and they ship it directly to your customer. Drop shipping is a great option if you want to save on storage and shipping costs, but it’s a much more hands-off way of doing business.

If you decide to drop ship, make sure you ask your wholesaler to send you samples of every single product you sell to ensure that the quality is up to your standards.

Will you be buying wholesale items domestically or internationally?

Supply chain hiccups throughout the pandemic have many retailers looking closer to home for wholesalers.

A domestic supply chain can mean less disruption, certainly. And customers often like made-in-America or Canada goods. But not all wholesale items are available from domestic manufacturers or suppliers, and prices can be higher.

Meanwhile, while you’ll have a wider (and more affordable) selection from international suppliers, you never know when you’ll run into manufacturing or shipping delays.

Rather than relying too heavily on one or the other, it may be best to ensure you’re sourcing from a mix of international and domestic wholesalers.

How to buy in bulk for wholesale

The general process for buying bulk items for wholesale is:

  • Find a wholesaler. Check out your local commerce center, wholesaler sites online and B2B marketplaces.
  • Contact the wholesaler. You may be able to skip—or at least streamline—this step if you’re using a B2B marketplace. Otherwise, reach out to the wholesaler over email and introduce yourself and your business.
  • Show your wholesaler your business licenses, if needed. Only merchant wholesalers will sell to the end user. Retail wholesalers may ask for proof you’re a legitimate business.
  • Sign an agreement with the wholesaler. Examine the terms carefully; have a lawyer look them over if needed.
  • Place an order with the wholesaler. The wholesaler will let you know how they prefer you to order. A B2B wholesaler marketplace will be the most convenient. Keep the minimum order quantity in mind—if you’re not ready to place an order that large, ask the wholesaler if you can order a sample first.
  • Determine your desired prices. Some manufacturers set prices for their goods—Apple, for example, requires resellers to price their goods similarly. Check your agreement for details.
  • Place more orders as needed.

Getting a wholesale license

Let’s clear something up: you don’t actually need a wholesale license to buy from a wholesaler. This is why the end customer can buy from merchant wholesalers. Without the right license, you pay sales tax on goods from a wholesaler.

You do need a license to resell items you buy from a wholesaler, however; generally, this will mean you at least need a sales tax ID, and is how to get wholesale prices. Depending on your jurisdiction, there may be other permits and licenses you need to resell wholesale goods.

Contact your state (or province) revenue agency for guidance on what they need from you. Be prepared to pay a small fee.

What are some additional factors to consider when buying wholesale?

Find your reorder points

In addition to figuring out which items to buy, you’ll need to calculate how much you need to buy. To avoid under or overestimating, use this free calculator to find your reorder point for each item.

Now that you have your reorder points, you can use Lightspeed Retail to help you keep track of which items are at or below their desired inventory levels. Once you’ve put your reorder points into your inventory listings, running the Reorder List report will let you know which items are low on stock and how much you need to reorder.

It’s okay to negotiate

Don’t be afraid to negotiate the price of goods when you need to. Let the supplier know if your sales are doing well and how much business they can expect from you in order to get a better deal. Be honest and fair in your negotiations to form a longstanding relationship with your wholesalers.

Organize storage space

Lastly, before your wholesale order arrives, you’ll also need to have an organized place to store it (unless you’re drop shipping). Having a storage room with adequate shelving makes finding different parts of your inventory that much easier. Keeping things labeled will make sure you don’t lose track of anything. If your inventory exceeds the confines of your storage room, consider upgrading to a warehouse equipped with industrial equipment meant to handle large scale fulfillment needs.

(Video) Buying Wholesale - You MUST Do This to Get REAL Wholesale Accounts

Getting the right products for your store

Figuring out how to buy wholesale to resell merchandise is an important step in increasing your profits and inventory. That’s why it’s important to take the time to do the math to make sure you’re buying and selling merchandise at prices that will work for you and your business.

You can use your POS system to help you crunch the numbers. Work with wholesalers who sell high-quality products, are reliable and can support your growth. By asking the right questions and having the numbers figured out, you’ll be well on your way to making smarter decisions to grow your business.

Want to learn more about Lightspeed’s commerce platform and how it can help you better manage suppliers, inventory and purchase orders? Watch a free demo today.

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What do I need to buy at wholesale prices? ›

In order to buy items wholesale, you will need to obtain a wholesale license. Depending on the state where you business is located, it could also be called a seller's permit, a resale ID, wholesale ID, retail ID or a reseller's license.

What do I need to wholesale products? ›

Getting a wholesale license

You do need a license to resell items you buy from a wholesaler, however; generally, this will mean you at least need a sales tax ID, and is how to get wholesale prices. Depending on your jurisdiction, there may be other permits and licenses you need to resell wholesale goods.

How to start a business with buying wholesale? ›

How to Buy Wholesale for Resale: Everything You Need to Know in...
  1. Form a Company.
  2. Get a Business License.
  3. Get an EIN Number.
  4. Secure a Tax ID.
  5. Obtain a Reseller's License.
  6. Get Insurance.
  7. Check If You Need a Licensing Agreement.
Feb 14, 2022

What do you need to start selling wholesale? ›

6 steps to starting a wholesale business
  1. Decide what you want to sell.
  2. Choose a business name and entity.
  3. Write a business plan.
  4. Get a wholesale license and other permits.
  5. Apply for an employer identification number.
  6. Figure out logistics.
  7. Expand your product lines and service.
  8. Increase your marketing efforts.
Oct 22, 2020

What is the minimum order for wholesale? ›

Minimum Order Quantity refers to the minimum amount that can be ordered from a wholesaler supplier. For example, if you have an MOQ of 100 units or $100, your customers must be able to purchase at least 100 units or spend $100 to be able to buy from you.

What percentage should wholesale price be? ›

After all, the most common way to calculate your wholesale price is by simply dividing your retail price by half. Ideally, your costs should only take up 25% of your retail price, but keeping costs low can be tricky.

Is it illegal to buy wholesale and resell? ›

Is It Legal to Buy Wholesale and Resell? Yes, it is legal to buy wholesale and resell. In order to do so, you must have a wholesale license and a business license that corresponds with your type of company. For example, if you only sell online, you'll need an eCommerce business license.

What not to do as a wholesaler? ›

5 Mistakes in Real Estate Wholesaling You Should Avoid
  • Mistake #1: Not Understanding Your Market.
  • Mistake #2: Not Understanding Your Buyers.
  • Mistake #3: Poor End-to-End Due Diligence.
  • Mistake #4: Complacency When It Comes to Your Buyer(s)
  • Mistake #5: Getting Too Reliant Upon One Contractor in Fix & Flip.
Mar 11, 2019

How does wholesale work? ›

Wholesalers operate as middlemen between product manufacturers and retailers or other businesses. They make a profit by buying products in bulk at a discount and reselling them in smaller quantities at a higher price to individual retailers.

How much can beginner wholesalers make? ›

With an average wholesale assignment fee of around $10,000 per transaction, it doesn't take many deals to quickly earn a respectable income as a wholesaler. Even just closing one deal every two months, an amateur wholesale investor could make around $50,000 in their first year.

How do I become a successful wholesaler? ›

To become a successful wholesaler, use the following steps to guide you:
  1. Do some research. ...
  2. Decide what you want to sell. ...
  3. Assess your financial situation. ...
  4. Develop a business plan. ...
  5. Consider legal and regulatory requirements. ...
  6. Evaluate suppliers. ...
  7. Decide on a location. ...
  8. Develop marketing strategies.
Jul 21, 2022

How much profit should you make on a wholesale product? ›

Set your wholesale price

This will ensure your wholesale profit margin is at least 50%. Profit margin is the gross profit a retailer earns when an item is sold. Apparel retail brands typically aim for a 30% to 50% wholesale profit margin, while direct-to-consumer retailers aim for a profit margin of 55% to 65%.

Do you have to be a business owner to buy wholesale? ›

There are at least three general options for buying wholesale goods if you do not have a business. You have the option of purchasing as a reseller without having a Sales ID or EIN. The second option is to buy as a reseller with a Sales ID or EIN without having your business registered.

What is the average income for wholesale? ›

Wholesaler Salary in Los Angeles, CA
Annual SalaryMonthly Pay
Top Earners$52,524$4,377
75th Percentile$50,423$4,201
25th Percentile$35,716$2,976

What is a wholesale price? ›

Wholesale price is the price charged for a product as sold in bulk to large trade or distributor groups as opposed to what is charged to consumers.

What is the best margin for wholesale? ›

Wholesalers typically have less of a profit margin when selling to retailers. While the percentage range will vary depending on the product, wholesalers usually make between 15% and 30% in profit, while retailers may typically make between 20% and 50% profit on the wholesale price when selling goods to consumers.

What is minimum number of orders? ›

A Minimum Order Quantity is the minimum amount of product that a supplier is willing to sell in a single order. Typically set by suppliers or manufacturers, the purpose of the MOQ is to ensure the supplier can make a profit on the sale and justify the costs associated with producing or delivering the product.

What are minimum order items? ›

Minimum order quantity is the small number of products you must purchase in one order from a supplier. Suppliers set MOQs to avoid wasting resources on orders that deliver little or no profit. It can be based on the number of units or the total order value.

What is the rule of thumb for wholesale pricing? ›

The general rule of thumb is that your wholesale price should be 50% of the retail price to ensure you can still make a healthy return on investment (ROI).

What is the formula for cost price? ›

Cost price = Selling price − profit ( when selling price and profit is given ) Cost price = Selling price + loss ( when selling price and loss is given )

What is normal wholesale markup? ›

The average wholesale or distributor markup is 20%, although some go up as high as 40%. Now, it certainly varies by industry for retailers: most automobiles are only marked up 5-10% while it's not uncommon for clothing items to be marked up 100%.

What is wholesale flipping? ›

Real estate wholesaling is similar to flipping. Both use property as a means to invest and make a profit. Both require a contract and the sale of a home. However, the time frame with wholesaling is much shorter than it may be with flipping. Also, the wholesaler does not make any repairs or modifications to the home.

Is Costco a wholesaler? ›

Costco might seem like a wholesaler, but it's actually a retailer since it sells goods directly to customers. Costco is able to use its revenue from membership fees to offset the cost of the goods it procures, leading to lower prices.

What is it called when you buy wholesale and resell? ›

Wholesaling is the act of buying goods in bulk from a manufacturer at a discounted price and selling to a retailer for a higher price, for them to repackage and in turn resell in smaller quantities at an even higher price to consumers.

How risky is wholesaling? ›

Wholesaling is a risky business. It's not uncommon for wholesalers to lose money on deals or have to wait months, even years before they see an acceptable profit on the investment.

How long does a wholesale deal take? ›

The timeline to close is usually anywhere from seven to 30 days. A wholesaler is the middleman of the transaction. They work to get a property under contract, then assign that contract to a buyer at a higher price. So the longer it takes the wholesaler to find a buyer, the longer your house remains in limbo.

What if a wholesaler can't find a buyer? ›

For example, if the wholesaler can't find another investor to assign the contract to, the wholesaler has to come up with the cash or financing to close on the property, or walk away from the deal and lose the earnest money deposit.

Is it cheaper to buy wholesale or retail? ›

The wholesale price is lower than the retail price for a few reasons: Bulk purchases: Wholesalers sell bulk items to retailers for a lower cost to create a profit for their business. By ensuring a bulk order (often with a minimum purchase), wholesalers can reduce shipping and handling times and the overall cost.

What is the benefit of wholesaler? ›

Wholesalers are able to sell their products for a lower price as they are selling in bulk, which reduces the handling time and costs involved. They usually provide large quantities of goods, but can take on orders for smaller quantities as well.

Is wholesaling products worth it? ›

Profit potential

Well, selling items sourced via wholesale has huge profit potentials. You can find items with great return on investment (ROI) for resale on Amazon because you buy them at a low wholesale price, compared to what other sellers are getting by buying from retail sources.

Is it hard to be a wholesaler? ›

Is Wholesaling In California Easy? No, it's not easy because wholesalers need to understand the state and local contracts and real estate laws.

How do I start wholesaling with no money? ›

How to Start Wholesaling Real Estate With No Money?
  1. Research.
  2. Find Funding Sources.
  3. Market to Sellers.
  4. Build A Buyers List.
  5. Purchase and Sale Agreement.
  6. Find a Buyer.
  7. Assign The Contract.
  8. Close And Collect.
Jan 23, 2023

Can you make a living off wholesaling? ›

Wholesaling Is Lucrative

On average, real estate wholesalers can expect to make between $5,000-$10,000 in commission per property. Once you have a property, a contract, and an interested buyer, this process can move quickly and you can start your business.

What is wholesaler strategy? ›

Businesses that sell products wholesale can use a wholesale marketing strategy. Wholesalers typically sell large quantities of products to retailers at low prices, who then sell that product in retail stores. Wholesale marketing targets retailers, to grow the client base of wholesalers.

Can anyone become a wholesaler? ›

As is the case with any business, the government requires certain forms to be filled out. The documents often include an eCommerce business license, employer identification number (EIN), sales tax ID, and potentially a reseller's permit. You'll also need to research how to get a wholesale license and apply for it.

What is a good example of a wholesaler? ›

The most common example of a wholesaler is a company that purchases completed products from manufacturers then distributes these products to retailers, which then sell smaller quantities of the product to the end-user.

What is an example of a wholesale price? ›

The goal of wholesale pricing is to make a profit by selling consumer goods at a higher price than it costs to manufacture them. For example, if making one product costs you $10 in labor and materials, you could set a wholesale price of $20, giving you a $10 per unit gross profit.

How much of a wholesale discount should I give? ›

To arrive at an appropriate value, consider factors such as your profit margin, your competitors' pricing, and your customer's needs and expectations. The typical wholesale discount percentage is between 10% and 50%. However, the deduction ultimately depends on your business and the products you're selling.

Do wholesalers take ownership of products? ›

Merchant wholesalers generally take title to the goods that they sell; in other words, they buy and sell goods on their own account.

Do wholesalers sell to individuals? ›

Wholesalers buy products directly from manufacturers. Then they sell the products to retailers, which are typically physical stores, although online retailers also buy products from wholesalers. The wholesaler plays a vital role in the supply chain by selling and distributing your products to other businesses.

How do I start a supply business? ›

How to start a distribution business
  1. Choose your product.
  2. Identify your niche.
  3. Decide how you'll sell products.
  4. Select how you'll manage inventory.
  5. Determine adequate storage space.
  6. Get a business license.
  7. Improve your business skills.
  8. Find manufacturers.
Mar 10, 2023

How to wholesale houses for beginners? ›

Here are a few simple steps to get started wholesaling:
  1. Research your local market before getting started.
  2. Curate a buyers list for your area.
  3. Secure a financing source that works best for you.
  4. Begin searching for potential wholesaling properties.
  5. Decide whether to sell the contract or work on a double closing.

What type of business is wholesale? ›

Wholesalers are organized to sell or arrange the purchase or sale of (a) goods for resale (i.e., goods sold to other wholesalers or retailers), (b) capital or durable nonconsumer goods, and (c) raw and intermediate materials and supplies used in production.

What is wholesale for small business? ›

Wholesaling is the act of selling your products in bulk to another retailer, usually at a discount, who then sells the product to its customers at a higher price. It's important to note that creating a B2B sector for your online business does still allow you to sell your product to the end consumer.

How much should I mark up my products? ›

While there is no set “ideal” markup percentage, most businesses set a 50 percent markup. Otherwise known as “keystone”, a 50 percent markup means you are charging a price that's 50% higher than the cost of the good or service. Simply take the sales price minus the unit cost, and divide that number by the unit cost.

How do you calculate wholesale margin? ›

Economics of wholesale pricing
  1. Total wholesale margin = Sales Volume x Product Margin.
  2. Total Margin = Sales Volume x Product Price - ( Sales Volume * Variable Costs + Fixed Costs )
  3. Total Margin = Sales Volume x Product Price - CAC - ( Sales Volume * Variable Costs + Fixed Costs )

Can you buy wholesale as an individual? ›

The only legal way to buy wholesale without a license is if you're a consumer. If you're a customer of a business that resells wholesale goods to the public, this is not a problem. There are hundreds of wholesale businesses that simply import goods and turn them around at a profit.

How to get wholesale prices without a business? ›

6. How to Buy Wholesale Without a Business
  1. You have the option of purchasing as a reseller without having a Sales ID or EIN.
  2. The second option is to buy as a reseller with a Sales ID or EIN without having your business registered.
  3. The third and final option is to buy in bulk as a consumer, i.e., a third party.
Jan 11, 2022

How does selling wholesale work? ›

What Is Wholesaling or Wholesale Distribution? Wholesalers operate as middlemen between product manufacturers and retailers or other businesses. They make a profit by buying products in bulk at a discount and reselling them in smaller quantities at a higher price to individual retailers.

Do you need capital to wholesale? ›

Wholesaling is considered one of the best short-term investment strategies and is a great way for individuals to break into the real estate investing industry. This is because wholesaling does not require significant capital to get started.

Is a wholesale business profitable? ›

Yes, starting a wholesale business is profitable.

Wholesale businesses purchase items in large quantities, meaning that the price per unit is lower than the standard retail price. This is what makes such businesses profitable.

Can I buy directly from manufacturers? ›

Depending on the business and type of products, most of the manufacturers won't sell products in small quantities. So, it won't be possible for an individual consumer to buy directly from the manufacturer. In that case, you should go to the distributor (who purchases products in bulk) to buy the product you need.

Do wholesalers sell directly to customers? ›

A wholesaler is a person or company who sells products in bulk to various outlets or retailers for onward sale, either directly or through a middleman. Wholesalers are able to sell their products for a lower price as they are selling in bulk, which reduces the handling time and costs involved.

What is the profit percentage for wholesale? ›

Wholesalers typically have less of a profit margin when selling to retailers. While the percentage range will vary depending on the product, wholesalers usually make between 15% and 30% in profit, while retailers may typically make between 20% and 50% profit on the wholesale price when selling goods to consumers.

How much do you mark up wholesale products? ›

The average wholesale or distributor markup is 20%, although some go up as high as 40%. Now, it certainly varies by industry for retailers: most automobiles are only marked up 5-10% while it's not uncommon for clothing items to be marked up 100%.


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