5 reasons to sell your goods at wholesale price on your online store

5 reasons to sell your goods at wholesale price on your online store

Most entrepreneurs make the mistake of underestimating the benefits that a wholesale channel can add to their e-commerce business, but any e-commerce business, large or small, can sell to both consumers and retailers at a wholesale price in order to reap the many benefits that... We will discuss them in this article, the most important of which are expanding the job market, gaining new clients, and enhancing trust between you and your current clients.

Reasons to sell your goods at wholesale price on your online store

Firstly, here are the benefits that you may gain. Unlike selling only at retail price, which is the standard price at which the consumer will buy your product, adding a wholesale channel will lead to:

• Increase sales and reduce costs, which translates into increased profits and growth
• Increase customer retention
• Expanded market share
• Increase trust in your brand
• We'll dive into the details but first, a short definition: Wholesale price is a discounted price you offer to customers who buy in bulk.
• You can set a minimum order quantity (MOQ), which is the minimum number of units a customer needs to order to qualify for wholesale pricing.
• This means that any customer who purchases from your store at or above your MOQ automatically qualifies for wholesale pricing.

 

Increase your sales

• Selling e-commerce items at wholesale will target two additional types of buyers:

1. Consumers who buy in bulk save money through lower cost per unit.
2. Businesses that buy at a wholesale price and sell to consumers at a higher price (B2B).

• Consider this: By selling exclusively at retail, you will have to convert a much larger number of customers to reach your target sales.
• The wholesale community is made up of experienced and high-earning e-commerce store owners. This ensures that every interaction you have will be fruitful and take you a step closer to your goals.

 

Strong customer relationship for life

• The second of the top 5 reasons to sell your goods at wholesale prices on your online store is that the lifetime value of a customer is a measure of the profits achieved by a single customer during the period in which he deals with your e-commerce activity.
• The longer a customer stays with your business, the more profit they will make.
• One of the main advantages of selling at wholesale price is that you can build a strong business relationship with your customers.
• You will be able to sell to the same customer over and over again, assuming you maintain consistency in your service and quality of your product, and this creates a high value of trust between you and the customer.
• The standard B2C scenario goes like this: The customer gives you money, you ship the item, and then you never hear from it again.
• On the other hand, selling at wholesale will attract other business owners, once they know that your product is selling well with their customers, they will come back to get more of the same product in bulk.
• You will still need to build good relationships with your wholesale clients, here are some tips:

1. Make sure your customer service exceeds excellence.
2. Keep the lines of communication open.
3. Make it easy for your customers to provide feedback or ask questions.
4. Be transparent with information like your pricing, company details, and product listings.
5. Make it easy to reorder.
6. Expand your market

• When we talk about 5 reasons to sell your goods at wholesale prices on your online store, you already know now that acquiring new customers is not an easy matter, and gaining the loyalty of these new customers is even more difficult.
• But by offering your goods at a wholesale price, you can attract strong partnerships with established brands in your niche.
• You'll get your merchandise into new territories without having to go through the hustle and bustle of introducing your brand to customers who've never heard of you before.
• As more of your product reaches different retailers' stores, whether online or brick-and-mortar stores, this builds awareness of your brand.
• Additionally, when customers see your product in different stores, they start building their own relationship with your brand, and this can ultimately drive organic traffic to your e-commerce store.

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Improve your credibility

• Adding trusted retailers to your customer pool through wholesale pricing builds your credibility.
• Speaking of 5 reasons to sell your goods at wholesale prices on your online store, specifically the fourth reason, when potential customers see that a brand they know and trust is buying from you, they are likely to see that your business is legitimate.
• Here are some ways you can achieve this:

1. 1. Display customer reviews on your ecommerce store, especially those from retailers.
   2. Post a live feed of the orders you receive from other wholesale and retail customers on the front end of your website.
   3. Reduce the overall cost of running your store

• In our talk about 5 reasons to sell your goods at wholesale prices on your online store, any successful entrepreneur in the field of e-commerce knows that one of the ways to increase revenues is to reduce costs.
• As mentioned earlier, adding wholesale pricing to your ecommerce store creates repeat customers.
• Considering that it costs five times as much to acquire a new customer as it does to retain an existing customer, a repeat customer will reduce overhead costs significantly.
• Targeting retailers through wholesale price will also reduce your marketing costs by shifting this responsibility to the retailer.
• All you have to worry about is selling merchandise in bulk to a retailer, and they can worry about getting customers.
• This allows you to direct your time and money to other areas of growth in your e-commerce business.
• Wholesaling will also reduce unit fixed costs. This refers to the share per unit of costs such as website maintenance.
• Unit fixed costs have an inverse relationship with sales volume. When sales volume increases, unit fixed costs decrease because the cost is spread over more units.

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How to calculate the wholesale price of your goods

• In our talk about 5 reasons to sell your goods at wholesale prices on your online store, and after we have presented the reasons, your wholesale price must cover the overhead expenses and the total cost price while maintaining a reasonable profit margin.
• A common wholesale pricing strategy involves offering a 50% discount on the regular price of the goods or the manufacturer's suggested retail price.
• MSRP is the recommended retail price and should be included in the contract you give to wholesale customers.
• MSRP ensures that retailers who buy products from you at wholesale will sell at a uniform price, preventing a situation where your product is available in a different store at a lower price than what you offer.
• Offering a 50% discount on the wholesale price allows retailers to retain a reasonable profit margin when selling to their customers.
• Here's an example of how to calculate wholesale prices for your online business:

1. Assuming your gross profit margin is 75%, you can offer a 50% discount on wholesale orders and still maintain a 50% gross profit margin.
2. Wholesale price x 2 = Regular price or recommended retail price.
3. You can increase your profit by harnessing the power of numbers. One way to do this is to apply tiered wholesale discounting.
4. This is where the wholesale discount varies based on the purchase order quantity; The higher the order, the greater the discount.

 

At the end of our article on 5 Reasons to Sell Your Goods Wholesale on Your Online Store and with the right tools to provide support as you explore this goldmine, your business is bound to advance to the next level, and the best part is that you can tweak your website to serve both wholesale and retail customers alike. .

 

Adapted translator https://www.ecommercefuel.com/wholesale-price/