Why it's so hard to open a Wholesale Account with authorized distributors?
I am a new seller on amazon, and started doing wholesale 3 months ago. And many distributors, when they find out this, they immediately reject me because I am new to this business or don’t have enough capital. I’ve tried to open an account with about 100 distributors and in 95% of cases I was refused. And those from whom I was able to open a wholesale account, they do not have profitable products. What advice or tip can you give me, what should I do to be able to open an account with distributors and be able to find profitable products?
Why it's so hard to open a Wholesale Account with authorized distributors?
I am a new seller on amazon, and started doing wholesale 3 months ago. And many distributors, when they find out this, they immediately reject me because I am new to this business or don’t have enough capital. I’ve tried to open an account with about 100 distributors and in 95% of cases I was refused. And those from whom I was able to open a wholesale account, they do not have profitable products. What advice or tip can you give me, what should I do to be able to open an account with distributors and be able to find profitable products?
4 replies
Seller_kIukTwdhvntAp
Here is a hint -- start SMALL. You have already found out the wholesale sources/brands of the big, popular items are PICKY about who they deal with and that is for a reason.
They want to sell their products but they also want to protect their OTHER wholesale customers.
I've been selling online for over 20 years and selling my current primary product lines for over 15. I have one brand I would LOVE to carry but since the Covid fiasco they can barely fill orders for their current stable of buyers. They have not been accepting new dealers for well over three years now.
As to the sourcing I go back 20+ years for my first products and I ended up with them because I could not find supplies for one of my hobbies (since gone dormant).
I looked around and found one of my old packages and called up the company. Found out they DID/DO sell wholesale and only required something like $500 initial order and a tax exempt number.
Filed with the state for maybe $10 and put an order on plastic for the $500+. Took about six months to pay off the card balance.
Kept adding suppliers and it became easier since they all ask for trade references and I had ONE. Found another small company that didn't have a large footprint and they let me in and again a small opening order.
NOW with TWO references it got easier for larger companies in the same or similar industries (competitors of company #1 or #2) since competitors LOVE to compete for your business!
Find local or regional businesses looking to expand distribution, new companies just starting out ( I have had a few that I bought from and they failed.)
Something that you know about or WANT to know about that doesn't have 10,000 offers on Amazon.
The possibilities are endless but it is VERY hard if you start with the 'big boys' in any industry. Those guys want some large orders. I had one manufacturer of products that I was sourcing from hobby supplier #1 but I wanted to go direct to save about 20%. They wanted $5,000 minimum and a pallet full of two or three SKUs as a starter. Did NOT happen back then. Now, I would think about doing it except for the fact that I have pretty much phased out those types of hobby products.
Seller_nRFmxiQg4EGrw
Why is it so hard?
Look at it from their point of view. If they have a big profitable product, then you are likely one of dozens, if not hundreds or even thousands, of new Amazon sellers approaching them to sell those items. If you read the forums, you will see that many new sellers are clueless, and will shortly lose their accounts. While this may not be true for you (you're asking questions first, so you're ahead of most of them), why would they take a chance?
And how would they benefit by having dozens or hundreds of sellers on Amazon selling their product? Amazon customers are going to buy a certain amount, whether it's from a handful of sellers, or a multitude. So getting more sellers for their product doesn't increase their sales; but it DOES increase the chances that one or more of these sellers will go out of business (due to too much competition) and not be able to pay their bills.
Once a distributor has a handful of Amazon sellers for their product, there is literally no upside to getting more.
In short, it's hard because you are trying what a million or more people have tried before you started. Running a business, whether on Amazon, other internet sites, or B&M, is never "easy", despite what the "gurus" on YouTube or TikTok will tell you. But Amazon is harder now than it was 5-10 years ago.
But if you start slow, follow the rules (very important), and sell quality products, it is possible to build a good business. Just keep in mind that any "get rich quick" possibilities from selling here are far in the past (unless you come up with your own "must have" product; which is great, but not a viable business model).
ETA: keep in mind that even buying from an Authorized Distributor does not, for many brands, make you authorized to sell those brands on Amazon. Get authorization FIRST for any brands you wish to sell here. (search the forums for Nike to read what happens otherwise)
And good luck! The fact that you are asking here puts you well ahead of many of the new sellers.
SEAmod
Hi @Seller_wrONhDRzXaPuq
I am pleased to see that both @Seller_kIukTwdhvntAp and @Seller_nRFmxiQg4EGrw gave you good answers to your question.
I encourage you to listen to their advice and to keep asking questions here when the question is about selling on Amazon. I can answer policy and program questions, but I have not been a seller on Amazon. I have learned a great deal from these forums over the past 10 years by listening to experienced sellers.
Susan
