Wholesale

[higge]

Hello.

This may sound stupid but I don't quite understand what is "wholesale".
I actually know what they do but was wondering how many uses those.
Or is it common way to build up a www business?

I am not building one because of my location in Finland but generally wanted to know ;)

Curious me heh

[Watdaflip]

Re: Wholesale

Buying merchandise wholesale is a way of increasing your product margins. When you buy wholesale you get a product for a cheaper price, but buy it in a very large quantity. You make more money because you didn't pay as much for the product, compared to buying for a larger price in smaller quantities.

but there is also the disadvantage of having more money tied up in a smaller variety of products.

The good thing about having an online store is you basically have a world wide market, (so you have a better chance of selling the larger quantity of product you bought) but you also have to compete with very large companies who will be able to outsell you, and with a cheaper price.

Buying wholesale cuts out the middle man, you are either buying from the factory, or from someone who bought from the factory. When you don't buy wholesale you will be buying a smaller amount from someone who bought from someone else who may have bought from someone else who bought the product from the factory. This increases the cost that you have to pay to get it (because every time the product changes hands, someone will charge more then they paid). So this means you will have to sell even higher then you paid, which means you can't compete with those who bought factory direct.

[higge]

Re: Wholesale

Thanks for a clearance Watdaflip. But what if you want to start selling something, do people usually join wholesale companies if they ofcourse do their products, or are those just for big boys?

I know I may have some marketing idea here in Fin but shipping accross the bond or even closer might be some what difficult. And how to find wholesale companies from here, I found it difficult

[Watdaflip]

Re: Wholesale

I would think that your ability to start off buying direct from a wholesaler would depend on the product you are selling and the kind of money you have to invest.

I know there are companies out there that have products you can sell (I guess they have a catalog of what products they have), and all you have to do is forward the order to them. They buy and store the products in their warehouse, and even ship them. Basically you just get a portion of the sale.

I can't speak of what or how people start up, I haven't a clue. The big companies buy things they sell in their stores wholesale, and store them in warehouses. For instance walmart have massive warehouses that store the products they sell. When one of their stores need more of a product the warehouses send out more of what they need.