How To Find The Best Wholesale Distributors For Your Retail Store
If you’re reading this, then by now you probably know that finding a wholesale distributor is no easy feat.
But you’re in luck because, by the time you finish reading this article, you’ll know how to find wholesale distributors for your retail store – both domestically and abroad. So let’s get started.
First, let’s quickly clarify a few things to make sure we’re all on the same page.
- What Is a Wholesale Distributor?
- Tried-and-Tested Ways to Find Wholesale Distributors
- Highly Targeted Online Search
- B2B Marketplaces and Directories
- How to Get the Most Out of Your Trade Show
- How to Buy Liquidated Stock Successfully
- Forums and Social Media Groups
- Buy in Bulk on eBay or Other Auction Sites
- What About International Wholesale Distributors?
- USA vs Chinese Wholesale Distributors: How to Decide
What Is a Wholesale Distributor?
A wholesaler distributor buys or receives products from manufacturers.
They then house these products in their warehouse and distribute them directly to retailers. As a result, wholesale distributors have little to no contact with the end customer.
Depending on the size or scale of your retail operation, there are different distribution channels available to you. This can also vary depending on your industry, country, and product, and you’ll find an overview of the three main channels… right now.
Wholesale Distribution Channels 101
- Jobber distributors – the smallest channel, think daily deliveries to local retailers with brick-and-mortar retailers.
- Regional distributors – sell lots to local wholesalers, who then resell this inventory to small businesses.
- Manufacturers – the top of the food chain, and definitely worth approaching if you know you’re regularly buying large quantities or developing a product from scratch.
Your wholesale distributor is an integral part of your retail business, so it’s important to choose wisely, make sure you’re plugged into the right channel then, and invest time in building your relationship with them.
Now that we’re clear on exactly what a wholesale distributor is, let’s define a set of criteria each distributor must meet to be considered as a partner for your business. There is no shortage of vendors both domestically and globally, and this will help you quickly narrow down your options.
Wholesale Distributor Criteria:
- Established for at least two years
- Supplies your geographical location
- Has a good reputation – online and in the streets
- Quality products at affordable prices
- Good communication and easy to work with
As you can see, it’s all pretty common sense stuff, but it can be easy to overlook the details when you’re in the thick of things.
Tried-and-Tested Ways to Find Wholesale Distributors
In no particular order, let’s explore some of the best ways to find American wholesale distributors who meet the above criteria.
The good thing is, you’ll also find many of these research strategies work equally well to find international wholesale distributors. You might need to change up your negotiating style a little, but keep reading – you’ll find some great tips for that too.
Highly Targeted Online Search
It can be notoriously tricky to find quality wholesale distributors online, and that’s because most – especially the smaller ones – tend to do a terrible job of marketing themselves.
Their websites are not search engine optimized, which means they’re usually overlooked by Google’s algorithm. That’s why it really helps to do a deeper level of Google research than you might normally be used to. Though as you delve into the deep pages of the internet, don’t be surprised to find slow, old fashioned websites that don’t exactly fill you with confidence.
To find as many potential wholesale distributors as possible, don’t forget to try a variety of search terms like wholesale, wholesaler, and distributor.
B2B Marketplaces and Directories
Directories are an efficient way to shorten your search for certified wholesale distributors for your retail business.
Though with so many options, it can be tough to know which wholesale directories to trust and which to avoid, so here are a few things to keep in mind.
- Do they charge a joining fee? And is there an ongoing monthly commitment?
- How easy is it to communicate with the customer service team for the directory?
- Do the wholesale distributors in the directory require a minimum order quantity?
- Does the directory have good reviews? What’s the word on the street?
Before you commit to any directory make sure you do your research and due diligence – especially if it’s a paid directory.
Go to Industry Trade Shows
Trades shows are a great place to find American wholesale distributors, so you can get your hands on hot trends before the masses.
Make no mistake, though, trade shows can be both daunting and time-consuming, so it’s good to have some insight on how to get the most out of them.
How to Get the Most Out of Your Trade Show
Know the Daily Schedule
If you want to max out your opportunities at a trade show, it truly does pay to do your research and plan your day ahead of time. There are lots of different events, presentations, and talks taking place – oftentimes on opposite sides of a huge venue.
To make sure you get to attend all the things you want to, you should check out the schedule and layout ahead of time, so you can plan your itinerary for the day.
Have Your Reseller’s Permit on Deck
During your excitement for the day ahead, it’s easy to forget to bring your reseller’s permit with you. This can literally be the difference between getting admitted into the event and being able to buy inventory, or being sent home empty-handed.
Certified wholesale distributors will ask to see your permit before they allow you to make a purchase order, so to avoid disappointment and a wasted trip don’t leave home without your permit.
Research the wholesale distributors you’re interested in
With hundreds of vendors all vying for your attention in an intense sales-driven environment, it’s easy to lose track of time. Doing some research ahead of time will help make sure you prioritize seeing the best ones.
You can usually find a list of vendors scheduled to have a booth at the trade show, and if you can’t immediately find it don’t be afraid to reach out to the show organizers and ask.
Don’t Give out Your Business Card Like Tic Tacs
That is unless you want to field floods of unsolicited and unwanted sales calls for weeks and months after the event.
Don’t forget to bring your business cards with you, but only hand them out to wholesale distributors you’re actually keen to build a relationship with. Be judicious with them or live to regret it.
Stick to Comfortable Clothes and Shoes
You’ll be on your feet for much of the day and covering a lot of mileage, so comfortable clothing and shoes are a must. It’s also a smart idea to have a few layers as some of the larger venues can be a bit drafty, and while you don’t want to be too hot, you don’t want to freeze either. Seriously, ignore this advice at your own peril.
Bring Your Artwork and Logo
Trade shows are a great opportunity to mock up custom or branded products right in front of you.
Make sure you have access to your artwork and logo files, both within your email and on a thumb drive, if you want to take advantage of that.
Make the Most of Negotiation Opportunities
Because you’re able to build instant rapport and read body language, trade shows are a great opportunity to be a bit more aggressive when negotiating order sizes and prices with wholesale distributors.
So sure, bargain hard, but don’t try to gouge vendors as this doesn’t bode well for establishing a long-term business relationship.
Liquidation and Overstock
Liquidation sales are invite only or limited entry sales/auction events, where vendors can come to purchase large amounts of pre-bundled product at dirt cheap prices.
It’s not unusual for department stores and brands to be a little off with their inventory and trend forecasting. This means each season they’re stuck with inventory hogging up space in their warehouse that’s actually costing them money to store.
To get rid of this inventory as quickly as possible, the inventory is palletized (packaged on large wooden pallets) and sold at liquidation sales for a deep discount.
Want to buy high fashion clothing for cents on the dollar?
Liquidation sales are your best friend, though, you need to be mindful as liquidation pallets may also contain returns and quality seconds.
They’re also sold based on the understanding that there are no refunds, so you need to be able to assume this risk.
Finally, you should bear in mind if the original retailer was unable to sell this inventory, you might not be able to either.
How to Buy Liquidated Stock Successfully
Research, Research, Research
Before you bid on a palette for your retail store, it’s important to make sure you know as much about the liquidator as possible.
There are several Facebook groups and online communities where retailers share their experience – which is a great way to get up-to-date information on liquidators you’re considering.
Check out this site for reviews on some of the most well known U.S. liquidation companies.
Decide on Your Budget Early
Unlike other types of wholesale distributors, where there is often a MOQ (minimum order quantity), liquidators sell in pallets or lots, so there’s not much room for negotiation.
So while you’re going to get dirt cheap prices on a large number of items, what you see is what you get. Keep in mind that you may not be able to get all your products with one liquidator, so make sure you keep enough in the budget to fill gaps in your inventory.
Forums and Social Media Groups
Specialized forums and social media groups for retailers can be a fantastic way to find a list of wholesale distributors, as you’ll find lots of research and resources shared within these types of communities.
You also need to be aware that alongside positive recommendations for wholesale distributors, you’re also going to find some scathing, negative reviews.
Some of these will be legit, and could potentially save you a costly nightmare, but there will also be many that have been fraudulently posted by competitors.
To find the best wholesale distributors for your retail store, you need to exercise a little discernment and possibly check more than one source for reviews.
There are more active ecommerce forums than strictly retail forums but don’t worry, the best wholesale distributors work with both online and brick-and-mortar businesses.
Check out these eCommerce forums to get started:
Buy in Bulk on eBay or Other Auction Sites
While not your traditional wholesale distributor, if you’re willing to do your research and shop around there are a great many bargains to be found on eBay and other online auction sites.
eBay, the world’s largest auction site, actually has a “Wholesale Lots” category that you can shop, according to the niche your store is in.
But it’s important you remember the pricing you see on eBay isn’t truly wholesale pricing. You will need to spend time watching auctions and learn how to buy effectively if you want to find a really great deal.
Subscribe to Trade Publications
Trade and industry publications contain a wealth of information about the inner dealings of your industry, and because they’re so targeted, they’re generally only available on a subscription.
It’s also important to realize that most, if not all, the advertising you find within the publication will be a wholesale distributor who wants to get your attention.
The good thing is, unlike their websites, advertisements that wholesalers place within trade publications usually contain up-to-date contact details.
Try a Google search typing in “magazines for (your retail industry)” as your modifier, to find the trade publications within your industry.
What About International Wholesale Distributors?
Many of the same search tactics detailed above remain the same when looking for wholesale distributors in China and other regions.
That being said, if you want to have a long-lasting, profitable relationship with your new international business partners, then it’s essential you learn how to negotiate.
How to Negotiate With Wholesale Distributors in China
While buying inventory for your retail store from Chinese wholesale distributors is a great way to save money and increase your profits, it does come with its own set of challenges.
Below you’ll find some great tips to help you navigate that process like a professional, even if you’ve never done any business overseas in your life.
Use Your Emotional Intelligence
From personal experience, I know Chinese business owners often use silence or delay as a negotiation tactic. However, after speaking with entrepreneurs more experienced at doing business in China, I’ve learned that this can mean a few things:
- You’re too small for them to work with you
- Your request is unreasonable
- They don’t have what you’re asking for
You’ll find that “we can’t” aren’t words Chinese wholesale distributors are particularly keen on using – even when that’s actually the truth. Instead, they’ll just put you on pause.
Be professionally persistent, but if you find yourself getting nowhere, you need to know when to throw in the towel.
Be Patient and Focus on Building Rapport
When you’re working with Chinese wholesale distributors, the slow pace of negotiations can get frustrating. Especially when you compare it to the relative ease and speed of working with American wholesale distributors.
In Chinese business culture, there’s a much greater focus on relationships, so things tend to move a little slower until they decide they want to partner with you.
Don’t be afraid to follow up via email, but if things slow to a crawl the best way to jump-start the process is to pick up the phone and call them.
Consider Hiring a Translator
You’re working at a disadvantage when you try to conduct business in a foreign language.
The good thing is, it’s possible to hire translators who can sit in on meetings, visit factories on your behalf, and read all digital and physical communication so you know exactly what’s going on.
Create a Win-Win Situation
Asian wholesale distributors expect you to negotiate. The thing is, it’s a bit of a complex dance with a few rules that should be adhered to.
Your goal should be to find a situation that’s a win-win for both of you. Go too low? Well, this reads as a lack of respect – which rarely goes down well.
That said, if you don’t negotiate at all, you’ll find you end up paying over the odds – sometimes way over.
Prepare to Wait
When working with Chinese wholesale distributors, be mindful of local and national holidays.
This means you need to make sure you’re ahead of ordering your inventory over holiday periods, as during these times you can expect slower than usual communication and lengthy shipping delays.
Many business owners only discover this when it’s too late, and they find themselves short on inventory with a long restock lead time.
Keep Your Options Open
When it comes to wholesale distributors – domestic and local – things can and will go wrong, oftentimes overnight.
That’s why it’s important you have other vendors sourced out – especially for your bestsellers – otherwise, you’ll find yourself with lots of demand and no supply.
Renegotiate at the Right Time
Don’t be afraid to renegotiate prices with your wholesale distributors, but wait until you’ve successfully made a few larger purchase orders.
You’ll be much more likely to strike a better deal once you’ve proven that you’re a valuable, repeat, long-term customer.
Make Sure You Order Samples
Before you break out the credit card and make a massive purchase order of poorly made goods you can’t even give away, make sure you order a sample.
You may need to pay full price for samples, but no doubt you’d rather pay full price for samples, than receive your shipment only to find it’s nothing like you expected.
It’s also a smart idea to ask your wholesale distributor what products are selling well in terms of volume of sales and repeat orders, as some of the winners you overlooked may surprise you.
USA vs Chinese Wholesale Distributors: How to Decide
It’s highly likely you’ll find cheaper prices if you’re able to source your products from China.
Even so, depending on what you’re buying, importing from China or other Southeast Asian wholesale distributors may not always be the right option.
So how do you decide?
Well, if your product is labor-intensive, working with a Chinese company is nearly always going to be more affordable due to much lower labor costs. Textiles, clothing, basically anything that has a handmade component, is something you may want to consider importing.
But let’s say you sell rubber kitchen utensils.
If you already own your molds, you might as well source close to home because the cost of rubber between Asia and the U.S. doesn’t actually differ that much.
Then there are minimum order quantities.
In order to take advantage of low unit costs, most Chinese wholesale distributors have fairly high minimum order quantities.
This is fine if you’re able to make that sort of upfront investment, but maybe prohibitive when you’re just starting out and need much smaller quantities.
So that’s it! We’ve come to the end of our article on how to find the best American wholesale distributors, international wholesalers, and how to negotiate with them successfully.
It’s important to remember that finding vendors and establishing a good relationship with them is a process.
You’ll need to do a little due diligence and be patient. There will be trial and error, but if you use the advice you’ve found in the article you’ll find it a lot easier.
Still got questions? Feel free to ask them down in the comments.