As a wholesale seller, it is essential to select products that are both profitable and low-risk. This is crucial because purchasing items in bulk can lead to significant financial losses if any issues arise. Therefore, performing comprehensive product research is vital. However, this process can be quite time-intensive and laborious. To enhance efficiency, consider using tools for product sourcing.
In this article, we will explain how the wholesale model operates and how to identify high-margin, low-risk products using one of the best tools, Seller Assistant.
What is Wholesale?
Wholesale is distinct from other business models because it involves reselling items in bulk. The main goal for wholesale sellers is to secure the lowest possible prices on sought-after products along with favorable purchasing terms. This is crucial for maximizing profit margins when reselling on Amazon.
To achieve the best pricing, wholesale sellers must connect with brands, manufacturers, or large distributors that can offer advantageous purchase conditions. This often results in significantly lower per-item costs, leading to higher profits.
Key Points to Remember About Wholesale
Wholesale operates differently from other business models, and there are several important aspects to keep in mind:
Importance of Product Research
Wholesale sellers make substantial upfront investments by purchasing products in bulk. Therefore, it is crucial to ensure that these products represent a sound investment and are likely to sell well. Additionally, it’s important to avoid potential issues (such as IP complaints, restrictions, or product flags) that could lead to financial losses.
Challenges in Entering Supplier Networks
To obtain the best prices, sourcing directly from the brand or manufacturer is ideal. However, many popular brands have established distribution networks, making them hesitant to change their arrangements. Wholesale sellers must persuade
brands to include them as an additional distribution channel.
Supplier Preferences
Some suppliers may be reluctant to collaborate with Amazon sellers, preferring those who sell through multiple channels. They may perceive additional sellers as increasing competition. However, if you notice other Amazon sellers successfully offering the brand’s products, this can serve as leverage in your negotiations.
Minimum Order Quantity (MOQ)
Well-established brands and manufacturers often have high minimum order quantities, which is the smallest amount of product you must purchase to complete an order. This quantity can be substantial, so be prepared to invest significant capital upfront.
Building Supplier Relationships
Cultivating a strong relationship with a supplier takes time. You must utilize your negotiation skills to prove that you are the right partner to help increase their sales. Demonstrating your experience in Amazon sales and your capability to sell in volume is crucial. Once you establish a relationship, you can discuss discounts and improved terms.
Low Advertising Costs
Since you’ll be selling established brands that already have a presence on Amazon, you won’t need to spend heavily on marketing and advertising. The brand’s existing reputation and promotion will work in your favor.
Steps to Wholesale on Amazon
Step 1. Locate a Supplier
Identify a brand, manufacturer, or large distributor that offers the products you intend to sell. You can achieve this through online directories, trade shows, or by directly contacting manufacturers.
Step 2. Negotiate with Suppliers
Reach out to potential suppliers, request quotes, and compare prices, terms, and minimum order quantities. Discuss pricing and highlight your value as a seller along with your anticipated order volume. Aim for a price that ensures a healthy profit margin, and negotiate payment methods, credit terms, and possible discounts for larger orders.
Step 3. Research and Select High-Profit Products
Obtain a list of products from your supplier. Utilize product research tools to evaluate sales data, product issues, and profitability projections. Look for items with high demand, low competition, solid profit margins, and positive customer reviews. Confirm your findings to ensure you achieve the expected profit and return on investment.
Step 4. Purchase Inventory
After selecting and validating your products, place your order with the supplier. The minimum order quantity (MOQ) can vary by supplier and product, but it typically ranges from hundreds to thousands of units.
Step 5. List Your Products on Amazon
Once your inventory is ready, you can list your products on Amazon. Generally, you will be selling items that are already in the Amazon catalog. Ensure that your offers align precisely with the existing listings.
Step 6. Fulfill Orders
When a customer places an order for one of your products, you will need to fulfill it. You can handle this yourself or opt for Amazon's Fulfillment by Amazon (FBA) service. With FBA, you send your inventory to Amazon’s fulfillment centers, and they will manage picking, packing, shipping, and customer service for your orders.
Why Use Seller Assistant for Wholesale
Wholesale sellers must conduct extensive product research on all items they plan to sell. This is because they purchase hundreds, if not thousands, of each product unit, and if the product is non-compliant or does not sell, the wholesale seller stands to lose a significant amount of money.
To effectively research and validate wholesale products, sellers utilize product sourcing tools. One popular tool widely used by wholesale sellers is Seller Assistant. It displays all essential product information across Amazon's search, product, and inventory pages, allowing sellers to quickly decide whether an item is worth selling.
In addition to standard product research capabilities, it includes Seller Spy to analyze competitors, Price List Analyzer for bulk product analysis, unique IP Alert database to avoid problematic products, UPC/EAN to ASIN converter for identifying ASINs corresponding to manufacturers’ UPCs, Bulk Restrictions Checker for efficient selling eligibility checks, Quick View feature for fast product research, and various other helpful functionalities.
Seller Spy
Analyzing your competitors can offer valuable insights into successful products and market opportunities you can capitalize on. Identify top sellers in your niche and utilize Seller Assistant's Seller Spy feature to keep track of their activities. Add your competitors to Seller Spy and download a file that shows which new products they start or stop selling, along with their pricing strategies. This information can help you incorporate these profitable products into your own inventory.
Price List Analyzer
Wholesale sellers typically reach out to brands or their distributors to obtain price lists for the products they offer, which may include hundreds or even thousands of items. While supplier price lists are a great source for new product ideas, finding profitable deals can be challenging. Leverage Seller Assistant's Price List Analyzer to streamline this process. Simply upload your supplier's price list, and the tool will generate a report highlighting high-margin items alongside valuable metrics such as ROI, BSR, Buy Box price, and Amazon fees. This enables you to quickly identify profitable products to sell.
UPC/EAN to ASIN Converter
UPC/EAN to ASIN Converter feature in Seller Assistant is a valuable tool that allows you to effortlessly convert UPCs and EANs to ASINs. With just one click, you can automatically discover the ASIN corresponding to your UPC or EAN. To use this feature, simply upload your UPC or EAN codes to the converter. The feature will automatically detect whether the code is a UPC or EAN and search for the matching ASIN. You can convert up to 1,000 UPCs or EANs in bulk using this tool.
Bulk Restrictions Checker
The Bulk Restrictions Checker feature identifies whether a product is restricted or not eligible for sale on your Amazon account. With Seller Assistant’s custom Bulk Restrictions Checker, sellers can check restrictions for up to 5,000 ASINs at a time and receive a report with the results.
Advanced IP Alert
An intellectual property (IP) complaints can occur when a brand files a complaint with Amazon regarding the unauthorized resale of its products. Seller Assistant's advanced IP Alert feature notifies you if a product you intend to sell has IP claims or other Amazon policy violations. IP Alert uses a unique Amazon policy violation database that is updated daily and provides details regarding the type and date of the policy violation.
Buy Box Percentage
The Buy Box is a section on the Amazon product page that allows shoppers to purchase a product with the "Buy Now" button. If a seller dominates the Buy Box, they are likely to receive a majority of the sales. Seller Assistant displays the percentage of sellers in the Buy Box, helping to identify if there is a dominant seller with whom it may be challenging to compete.
Quick View
Quick View is a widget that appears on Amazon search pages and presents key product details. This feature helps you estimate whether it is worth researching a product further. Quick View provides information such as the product's ASIN, BSR in its main category, the FBA and FBM product offer count, product restrictions, and IP Alerts, if Amazon sells the product.
Export to Google Sheets
With Seller Assistant, you can easily export your product research data to Google Sheets with a single click. You can choose from over 100 product characteristics for data export and save results directly to Google Sheets for further analysis.
Final Thoughts
In conclusion, while finding Amazon suppliers is a key task for wholesale, researching products is equally important to ensure you will earn money on them. That is why it is crucial to utilize comprehensive tools for sourcing products to achieve success. One such popular tool is Seller Assistant.
It is the ultimate product sourcing extension that can assist in finding profitable products. With its advanced tools and features such as Price List Analyzer, Seller Spy, FBM & FBA Profit Calculator, Quick View, ASIN Grabber, IP Alert, Restrictions Checker, and other product research functionalities, you can automate product data collection. This will provide you with crucial insights into product profitability, competition, demand, and other essential product information. By leveraging this information, you can select high-margin items for your store.
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