After developing a product worth buying, most entrepreneurs and business owners implement a direct-to-consumer strategy to market, sell, and ship their products or services directly to the consumers, without relying on any intermediary or distribution channel. While this option gives a brand greater control over its reputation, product pricing, and marketing campaigns, the business owner ends up bearing all the internal workload and costs.
However, selling to other businesses, instead of directly to buyers, transfers the burden of acquiring customers to someone else, allowing you to spend your time and efforts on business activities that you’re brilliant at and redirect your money to other more important aspects of your enterprise. This means your business benefits from increased sales without spending more on marketing.
Another benefit is that you can expand your business into new markets with less risk and minimal setup costs. Plus, you get to leverage other brands’ goodwill and audiences to market and sell your products. You should, however, know that creating a wholesale partnership with retailers isn’t as easy as you might think. You’ll need to take time to acquire the necessary industry knowledge and consider many things before getting started. Here are seven tips to help you make your dream of selling wholesale to retailers a reality:
Conduct Target Market Research
The fundamental difference between selling wholesale and selling directly to buyers is that you’re dealing with other businesses rather than individual customers. Conduct market research to determine the ideal market for your products among retailers. Your business might have been successful when it comes to selling directly to the end-consumer, but that doesn’t mean retail stores will be as interested as your customers.
Your market research should focus on finding store owners and dealers who might want to procure your products and sell them in their stores. You want to gain a deeper understanding of your prospective retailers’ needs and buying patterns so you’re in a better position to demonstrate to them the value your products will bring to their business. You should also identify who the retailers’ target customers are and take time to understand how they acquire their customers.
Additionally, it’s important that you identify retailers that are selling your competitor’s products and examine their pricing, quality of service, and marketing strategies. Finally, don’t limit yourself only to the large retail stores. In fact, you have a greater chance to convince and sell to smaller retailers than to large ones.
Develop Your eCommerce Strategy
A 2016 report by Microsoft found that nearly 9 out of 10 consumers expect brands to provide a customer self-service portal where they can find useful information about their services or products. That simply means you can no longer sit back and wait for your customers to make an order or ask questions about your products by phone or email. To gain an edge to survive in today’s ultra-competitive market, your wholesale business must implement an eCommerce strategy.
Once you’ve identified retail stores that might be a good fit for your products, you should consider setting up an eCommerce site or a branded B2B eCommerce portal. Retailers will be happier that they can contact you easily, place their orders, track their current orders, and get answers to their questions or concerns quickly, from anywhere, anytime. They’ll also be able to make payments for their orders at their own convenience. This means you can focus your efforts on upselling, streamlining your operations, innovation, and promoting new products.
Use Wholesale Distribution Software
Wholesale businesses involve numerous supply chain stages and it can be challenging to keep all the business processes functioning efficiently while ensuring ever-changing customer demands and requirements are met. There’s no doubt you’re going to approach and convince retail stores to procure and sell your products. However, to ensure greater visibility of product flows, have greater control over your supply chain management and create a smooth customer journey, you should consider using a wholesale distribution software solution.
A wholesale distribution software system allows you to effectively forecast future demand, optimize financial processes, and track all the activities within your distribution network. It also gives you greater control over your pricing and decision-making processes, allowing for more effective shipping and delivery of products to retailers.
Determine Your Minimum Order Quantity (MOQ)
In a perfect business environment, you’d have supplied your wholesale products to retail stores in the exact size and quantity they need them. You’d have even been more than happy to deliver them at zero cost. But you know this isn’t sustainable for your business, and even though you may not prefer selling using minimum order quantities (MOQs), it’s a necessary option— at least if you want to increase your Average Order Volume (AOV), maintain a healthy cash flow, and stay profitable.
You, therefore, should set the lowest threshold quantity that retailers must buy on a given order. Some retailers may criticize or complain about this move but you should let them know that’s what justifies the discounted pricing you’re offering on your products.
Establish and Maintain Good Relationships
The first place you should probably start looking at when creating wholesale partnerships is your personal network. But that doesn’t mean you hold back when you see a retail brand you admire and would bring value to your business. The most important thing is that, once the orders start rolling in, focus your efforts on nurturing relationships and building trust with your B2B customers. And there’s no better way to do this than to keep your promises, improve the customers’ buying experience, and provide an exceptional customer experience.