In this article I will try to define what exactly is product sourcing and what are the implications of committing yourself to do a proper product sourcing research for your retail business.
Retail sellers need a constant supply of products that meet the quality standards expected by their clients and simultaneously with right prices (high-margin products) in order to reach their profit goals.
With that said, product sourcing research is the task that allows retail sellers find reliable wholesale sources that help them to accomplish above objectives; or in another words, product sourcing It’s nothing more than doing the proper and extensive research in order you may be able to locate genuine wholesale suppliers for you retail business (online or brick and mortar).
If you have been wondering why your competition outsells you with better prices, then maybe this happens just because your lack of correct product sourcing research, if there is any, or simply, your store is been fed by NOT real wholesale suppliers.
Well, the only way for your task of doing a good product sourcing research become fruitful is when you come up with a real wholesale distributors database. these wholesale distributors must be the ONLY link between you (as retail seller) and the manufacturer.
Each additional link in the from manufacturer to your retail store chain represents less profit (lower margin) and increased chances of you being more tempted to raise your prices, at the end, this means potentially less consumers.
How do I know that the source I just found is a true wholesaler distributor?
Well, there is not a definitive response for above question, but yes, there are a few points that would help you to separate the good ones from the scams.
- The real wholesaler distributor should have a physical address.They must have some nice storage capabilities (after all, where you expect your wholesale products come from, specially with large volumes?), not just a well-designed web site. So, a reachable physical address with some people in staff is a very good sign of reliable wholesale distributors.
- Contact local chamber of commerce.A good idea could be to contact their local chamber of commerce or Better Business Bureau, they must be on good standing with them.
- Search for complaints.Why not search Google for more info about this wholesaler prospect, maybe you find complaints or testimonials about them; not only search engines are good in this purpose, sites like scam.com might let you draw conclusions.
Ask for references to the manufacturer of the product that you expect to sell.One the most effective ways of knowing if a wholesale distributor is who he claims to be is: contact the manufacturer of the products! After all, the manufacturer is the first link in the chain of product sourcing; sales departments of the manufacturers know who their legitimate Wholesale Suppliers are.
It’s just question of looking at the packaging of the product or plastic cover, etc. to find the manufacturer, call them and ask who are their authorized wholesale distributors, they will help you, after all, they are interested in sell more of their manufactured products.
Well this is a reliable wholesale distributor, now what?
After you found that this particular wholesaler has passed the previous test all that’s left is call them and ask that you want to do business with them, that you what to buy from them directly. and if they are for REAL they should ask a few questions about your business, I mean you must be a legal business in order to be able to work with genuine wholesale suppliers, they will ask you for legal business paperwork and tax ID numbers, and this sort of legal issues.
By the way, you could add the following item to the above section — How Do I know that the source I just found is a true wholesaler distributor?–NO REAL wholesale supplier will allow you to do business with them if you are NOT a legally constituted business.
So, if you are a legal business and meet one or two of their specific requirements you will soon be doing business with a legitimate wholesale distributor, and you will in your way of a more profitable business.
Remember the ONLY three members of a true chain of wholesale product sourcing are:
Manufactures (sales departments) ==> Real Wholesale Suppliers ==> your store (Retailers)
Please always make sure that there is nobody else in this chain; if there is anybody else that is a parasite who will suck your profits.