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To wholesale or not to wholesale, the outline that could tip the scale


To explore whether to venture into the world of wholesale or not, like taking any leap of faith, starts with you weighing out the pros versus the cons of making such a move. Though the odd bump in the road is not uncommon when expanding the scope of your business, the rewards of making the jump should make it all worthwhile. In this post, we want to shed some light on the main advantages that opening your business up to the wonders that wholesale could bring you, while underlining the possible hiccups you could encounter along the way.



First off, let’s highlight the fact that you will be reaping the rewards of fulfilling larger orders. To sell at a wholesale level means that you will aim to sell multiple units in one single sale; selling a large quantity of units at one time to multiple customers inevitably results in a quicker, heftier payout for you. Retail stores are revolving doors (quite literally) of a great variety of customers who are all shopping for something different. Meaning that these stores have to offer a wide variety of products in order to cater to them all. This directly translates to you fulfilling a larger order than what you would have normally sold to a single individual at a retail level. Not only do retail stores need to offer an array of styles, colors or sizes, they also work to provide a proper representation of each brand they carry so that their customers turn to them first to shop a brand in particular (maybe yours!).

An even more interesting scenario than that of a single standing retail store is one in which you are selling to retail chain stores. When doing business with customers like these, you can expect to receive multiple versions of the same order. Such orders are meant to feed each of their doors (if you are unfamiliar with the term, “doors” refers to the different locations a retail chain has. Now this is adding up quickly, isn’t it?). This type of retailer will customize their seasonal orders to each door; this is why it is SO important to keep track of which doors are performing well with your brand and which ones may be having a tougher time.

In the same vein, the importance of knowing which product or style in particular does well and which doesn’t is imperative. Requesting “sell-through reports” will give you access to this oh-so-precious insider info. These are in-season reports that allow you to monitor the performance of your product within each door that carries your brand. Doing this will help you get to know your customer’s clientele within each door and will guide your sales pitch for next season. If your customers’ sell-throughs are positive, they may want to contact you in-season to place re-orders (you can also be so bold and reach out to them first, even complimenting them on their outstanding performance with your product!). In the case where their sell-through report for your brand is not so good, it might be a good opportunity for you to take initiative and explore the swap option that we discussed in an earlier post (The “How-to” to Wholesale; A short guide to Establishing Your Business Beyond Retail).


Next, gaining exposure through your wholesale business is an amazing way to cut costs on marketing and visibility tactics. To have your brand sit in multiple stores at once and have each store’s specific clientele exposed to your product will help your business grow on its own. This can become an exponentially beneficial situation if you make your product available in well known and established stores; the notoriety of the store and the existing trust its customers have in it will transpire onto your brand. This will, almost as if by osmosis, confirm the credibility of your brand with their own clientele, support that your product is up to their standards and assert that you, as a business, are in fact the real-deal (thank you very much). In other words, placing your brand in the hands of a well established retailer ensures that the job of selling what you’re selling to their customers is already done (thank you very much, again!).


Lastly, being able to depend on more consistent payouts validates the decision of growing a business toward wholesale for many brand owners. All depending on the industry that you work in, sales generally happen seasonally as retailers will work based on buying schedules (Spring/Summer and Fall/Winter for example). In-season re-orders will depend on your product’s performance, but you will be able to count on a fairly consistent order from your customers each season. Having a little extra stock (if possible) to fulfill re-orders is a good idea if you notice that these types of orders become a trend.

These three core benefits of launching your brand into the world of wholesale are so very enticing but, they do not always come without challenges attached. It’s SO crucial for you to make the move towards wholesale when your business is ready, and ONLY then, in order to ensure that you are able to take on these challenges and come out on top. We’ve underlined the three main hurdles that you may encounter along your way in the spirit of a friendly ‘heads-up’, since these are not always lurking in the shadows.



The first obstacle is fairly straightforward and can be expected when dealing with retailers of all sizes and calibers. You will want to make sure that the way you run your business gels with your wholesale customers’ company guidelines. Most retailers will have their own modus operandi when working with third party partners such as yourself; rules encompassing shipping and receiving are a huge factor for a lot of the retailers you will come across, payment plans for large purchases will involve manpower from multiple departments of theirs including accounts receivable and payable, which are zones where the ship is often run the tightest, rules surrounding buying methods, delivery appointments, the list can go on and on. But fear not, having the adequate resources on your end to understand your customers’ standards and determine whether you can fulfill all of their expectations will make tackling this hurdle a cakewalk.


Second pesky snag, the cost of production. You’ve already defined and outlined the cost of production for your goods, but have you examined your capacity of production within a specific timeframe (or delivery window)? You should always make certain that your capital and manpower are strong enough to accommodate the production cost necessary to fulfill all of the orders that you take on. It’s important to note that it’s quite common practice for retailers, especially those ordering in very large quantities, to benefit from a 60-day period after they’ve received their order to complete payment. The key is to plan accordingly; defining clear payment terms from the get-go will help you dodge these types of bullets if need be. Whatever your position may be when it comes to the cost of production and the end-game of getting paid, this is definitely something you will want to include in your terms and conditions agreement.


Lastly, the aspect of distribution can blow up a few landmines if you do not tread this territory carefully. We mean the actual, physical transition of your product from your hands into the hands of your customers. We cannot stress this enough, and for lack of better terms, you need to light a fire under the seats of your production staff AS SOON as you bank a wholesale order. If you don’t, you might not be able to bank the full monetary amount of said order. In other words, meeting “ship” dates and “cancel by” dates are crucial; missing these dates directly eats into your customers’ window to sell your product to their consumers because, as we well know, seasons pass and most things have a limited shelf-life. Planning an airtight pick-pack-ship plan to distribute all of the goods allocated to each of your orders will void, unless you come face to face with a gaffe by your shipping company of choice, any possibility of chargebacks or cancellations.

We hate to repeat ourselves because we know you get it, BUT this business is all about timing. In order to take on these potential challenges, making sure that your business is ready to make the leap into the wholesale sphere is task “numero uno”. Once that’s out of the way, you will surely come to the conclusion that making the jump did in fact make is all worthwhile and will begin to reap the sweet fruits of your labour.


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Feel free to reach out to us if you have any questions. We’d love to see how our company can help you start, launch, and grow your business. Email us today!


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