Introduction to Wholesaling

Introduction to Wholesaling

Lesson Details:
February 15, 2020

Video Transcription: So in this video you're going to learn what wholesaling is and the pros and cons of wholesaling so what is wholesaling now wholesaling is when you order a product directly from the manufacturer that produces it and then you receive that product this inventory shipped directly to your home or place a business and once you have that inventory when a customer places an order with you you ship that product from your home or business directly to your customer so what usually happens when you wholesale is you order your products in batches from the manufacturer so when I was selling bracelets I would order about 60 bracelets at a time so I place a large order with the manufacturer once they were done producing these bracelets they would ship the bracelets directly to my home and that meant that those bracelets were a form of inventory so I would have 60 bracelets sitting in my home and whenever a customer placed an order with me for one bracelet I would then ship a bracelet directly to the customer so the advantages to wholesaling are you have much more control over the whole process you're getting the products delivered directly to your home and your shipping those products to your customer you're not leaving that responsibility to somebody else you also have a much higher profit margin because no one's doing all the work for you you're gonna make a lot more money because you can buy these products pretty cheaply and then you can sell them for a much higher cost on ebay. There's also many more suppliers that wholesale there are tens of thousands of manufacturers that you can wholesale products from and in a later video I'm going to show you exactly how to find these profitable products but at this point it's just important to know that when you wholesale there are an endless amount of products that you can choose from and finally in most cases you'll spend a lot less on shipping and that's because when a manufacturer dropships a product for you they usually charge a lot in shipping cost but as you'll find out in a later video there's ways to ship items very cost-effectively which means you're not gonna pay that much for shipping when you're shipping the products yourself now there are disadvantages to wholesaling and most of these disadvantages actually scare people away so they don't give wholesaling a try and the first is inventory so when you order your products like I said with the bracelets that I ordered you then have to sell those bracelets if nobody's buying the bracelets then you still have inventory in your home that you've already paid for so that's why it's very important when you're finding profitable products in the first place is to make sure it's a product that has a market and people are willing to pay for it the next disadvantage is there's an upfront cost so you have to place that large order with the wholesaler before you get money from your potential customers now the way around this is to order small batches first and then make money and when you make money then you can afford larger batches and you keep doing this and order more and more large orders over time and the last disadvantage is shipping time and that's because once you place an order with the manufacturer it often takes them a while to make the products and eventually ship it to you so with these disadvantages in mind wholesaling is still by far the best option and it's really not as bad as most people think and the biggest thing I've heard that stops people from wholesaling is that upfront cost but the truth is you can get started for less than $200 and just work your way up as you make more sales and generate more money.

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