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Wholesale eCommerce

Every business has its own story, but one thing even the biggest brands have in common is that they started out small. This is one of the most exciting parts of being in business: the idea that a one-person company, based out of a garage, can eventually develop into an international enterprise. Many businesses are currently on this path toward growth, and may be looking into becoming wholesalers as the next step.

Moving from a familiar B2C business model into wholesale can be challenging, but Shift4Shop has everything you need to make the switch — whether you intend to keep selling to individuals alongside your wholesale clients, or transition to it completely. This guide will help you understand wholesaling, how to get started, and the tools you'll need on a wholesale eCommerce website.

Topics Covered in this Guide

Introduction: What is Wholesale?

Selling wholesale is the process of selling products in bulk to other retailers who will then mark up the price and sell the items from their own stores. Essentially, the wholesaler is the "middleman" between the manufacturer or other distributor, and the end consumer.

Wholesaling is very different from selling directly to individual customers, as it involves a much larger scale, and wholesale clients have different expectations from end consumers. These factors are at the core of the difference between B2C (Business to Customer) and B2B (Business to Business) eCommerce.

What is Wholesale

Understanding B2C and B2B Sales

Most businesses are B2C, meaning they sell directly to end consumers, i.e. individuals shopping for themselves (or family or friends, etc.). B2C consumers are what most people think of when they hear the word "customer."

On the contrary, B2B merchants sell to other businesses. They work "in the background" to move goods and services to consumer-facing B2C businesses. A supply chain can involve any number of B2B businesses before the products finally reach individual consumers. Wholesalers and other types of suppliers fit into the B2B category.

B2B Sales

Some businesses sell B2B and B2C at the same time, by offering different pricing or promotions to B2B customers or providing them with a whole different shopping experience. There are multiple ways you can segment your B2B and B2C customers if you still want to sell B2C after becoming a wholesaler. We will cover some techniques in this guide when we discuss tools for wholesale eCommerce stores.

While the end consumers targeted by B2C companies have a familiar set of needs, B2B buyers have their own requirements and expectations for any wholesaler they consider doing business with. These include bulk pricing, methods to help them place large orders quickly, and support for corporate-based payment methods that typical consumers don't use. Check out our guide to B2B eCommerce for more specifics.

Benefits of Becoming an eCommerce Wholesaler

Moving into wholesale is a natural growth step for many businesses that are ready to sell in higher quantities. Wholesalers can be at different steps in the supply chain — some manufacture their product, while others distribute products manufactured elsewhere; what makes them wholesalers is that they sell inventory in bulk to other businesses, not their exact position in the process. No matter the specifics, becoming a wholesaler can benefit your business in several ways.

Lower Costs from Manufacturers

This benefit applies to products your business doesn't manufacture itself, and needs to stock up on for future distribution. Wholesalers can get lower costs when buying from manufacturers because of the sheer volume they'll need to purchase to supply their wholesale clients. Additionally, some manufacturers will only work with a wholesale distributor rather than customer-facing retail stores, so if you've already been selling products from manufacturers who do this, you've been buying your stock from a middleman supplier with their own markup. Becoming a wholesaler will allow you to skip that supplier and make your own deal with the manufacturer at a lower cost.

Profitable Long-Term B2B Client Relationships

B2B buyers make careful choices when picking a wholesale supplier because they prefer to choose one they can remain with for the foreseeable future. Changing suppliers can disrupt their business by causing differences in their products, including pricing, quality, and manufacturer, that customers may not like. Securing a new B2B client isn't easy, but if you manage to establish yourself as a business's supplier, they are likely to stick with you. This long-term loyalty means consistent, predictable income for your business. Wholesalers usually only supply a small number of B2B customers, which also means a better opportunity to develop this relationship than would be possible with your time split between thousands of shoppers.

Potential for Rapid Growth

Selling wholesale can speed up your business's growth in several ways depending on your circumstances. For example, if you're a manufacturer, selling in bulk may allow you to raise your production volume and lower overall costs, as the cost-per-unit nearly always goes down when volume is increased. This would improve your profit margin. Fulfillment costs will also see an overall reduction (per unit) since you'd be shipping in bulk to a smaller number of customers (and depending on your business, some may be packaging your product themselves for final sale, further reducing your costs). Finally, if you're an inventor or manufacturer, wholesaling is a great way to get more attention for your product by placing it into more markets. Remember that your wholesale customers are also trying to sell the items you sell to them, so they'll be marketing your products.

A Streamlined Process through Selling Online

Just like with B2C eCommerce, wholesale eCommerce gives you the opportunity to provide complete information about your products so wholesale clients can browse your website freely, rather than need to contact you for basic information. Your website will also make it easier for potential clients to find out about your products in the first place, especially if your SEO is good. Overall, eCommerce has made things much easier for businesses in search of wholesalers, which means more potential for businesses like yours to find long-term clients.

Ways to Sell Wholesale

The process you use to start selling wholesale will vary depending on your business's situation and your future plans. Ask yourself these questions:

  • Do I want to keep selling to regular customers and sell wholesale at the same time, or do I want to move completely to wholesale?
  • If I sell B2C and wholesale at the same time, how distinct do I want my customers' shopping experience to be?

Your answers to these questions will determine whether you overhaul your eCommerce website to serve wholesale customers exclusively, or if you implement ways to sell to both types of customer. Many small businesses that develop into wholesalers decide to keep selling B2C at the same time, which has become possible because of the tools available in eCommerce.

Depending on how strictly you want to separate your business's wholesale and B2C shopping experience, you could create a different website for wholesale clients, or you could serve both types of customer from the same website. Many small businesses that move into wholesaling prefer to follow the second method because it allows them to concentrate their efforts on a single website that has already been established.

If you decide to sell wholesale from your existing website, you'll need to offer bulk pricing to your wholesale customers without lowering your regular prices that normal consumers can access. There are a few ways you can do this.


Offer Discount Codes or Coupons

One simple way to support bulk pricing is to create a discount code that automatically applies when the customer adds a minimum order quantity to their cart. It's not as precise as other methods and doesn't give you as much control, but this can be a good method if you want to encourage wholesale purchases from existing customers. If you'd prefer to use this method, you can set it up in Shift4Shop with our built-in Promotion Manager.

Bulk Pricing

Offer Tiered Bulk Pricing

Tiered bulk pricing means the price per item continues to decrease when the customer adds a higher quantity to their cart. This encourages larger purchases and benefits both you and your client: the more a wholesale customer buys, the lower the price needs to be in order to remain profitable to you, and the higher their own resale margins. Shift4Shop has this feature as well, and you can set up pricing for any number tiers using minimum and maximum quantities for each price.

Pricing Levels

Offer Customer-Specific Pricing Levels

If you don't want your wholesale pricing to be visible to every customer, you can tailor your website to offer a different shopping experience depending on whether the visitor is a B2C customer or a wholesale client. Wholesale buyers often prefer this method since they don't want their customers to know the cost at which they purchased the item for resale. In Shift4Shop, you can do this with Customer Groups, a powerful segmentation tool that lets you automatically or manually assign customers to one or more groups depending on your chosen criteria. Each group can have its own Price Level, which assigns them a specific price for products. Since Customer Groups and Price Levels work with bulk discount tiers as outlined above, this is the most complete and precise method.

Tools You Need for Selling Wholesale

Your eCommerce website will need certain features to help you sell wholesale, as well as tools for you to use behind the scenes to set up your online store and manage your wholesale business. Shift4Shop is fully equipped with everything you need to successfully compete in the world of wholesale eCommerce.

Customer Groups

Customer Groups with Price Levels

We mentioned Customer Groups as a useful method for splitting wholesale customers from regular B2C shoppers, but this feature is versatile enough to be used for many different applications. With Customer Groups, you can create as many groups as you need so you can offer specific pricing and marketing per group. You can also control product visibility, and hide the pricing (or the entire product page, if desired) from customers that aren't in a certain group. This feature gives you total control over the browsing and shopping experience you want to offer to each customer, so it's perfect for selling B2C and wholesale from the same site. You can also use Customer Groups to segment your wholesale customers so some clients get different pricing than others, for example creating a VIP group as an incentive for the most loyal customers or those who place the largest orders.

Bulk Discount Tiers

Minimum Order Quantities and Bulk Discount Tiers

Shift4Shop allows you to control minimum order amounts for any reason, including to activate bulk discounts. You can set up different discount tiers to apply depending on the quantity the customer selects; e.g. at a quantity of 100 – 499 an item will cost $1 each, but at 500 and up it will cost 75 cents each. Discount tiers can be created as needed and they're also a great solution for selling to regular customers from the same product page if you want your wholesale prices publicly visible, as you can simply display a minimum order quantity needed to access the wholesale rate. For items being sold by the pallet or other predetermined package amount, you can also use Fractional Quantities to represent the price-per-item on a whole or partial pallet.

Order History

Order History and Fast Reordering

Wholesale customers will want to see their previous orders at any time, and since they usually repeat the same order, they'll want a fast way to do so without needing to browse your website again. Shift4Shop makes this easy for them in a few ways. Customers can access their order history from their "My Account" page and can even reorder from it. You could also opt for the Quick Order Pad, which lets customers quickly fill in an order if they already have the product number or SKU for everything they need (either because they're familiar with your site or you sell items with industry-standard part numbers). The Quick Order Pad works for reordering if the customer prefers not to do so from their history, and also works for brand new customers as long as they have the SKUs they need. It's included free in our B2B eCommerce plan.

Inventory Control

Inventory Control and Purchase Orders

As a wholesaler, it's crucial that you never run out of stock without warning. Shift4Shop's Inventory Control system tracks your inventory numbers and can be configured to notify you when stock reaches a certain minimum threshold. And while some wholesalers manufacture their products themselves, others get them from distributors, so our Purchase Order system will help you quickly generate purchase orders to restock your inventory. They can even be automatically generated when your current inventory gets too low.

Procurement Software Compatibility

Procurement Software Compatibility

Some businesses prefer to use their own procurement app or software to order products. These systems can vastly streamline their operations and may sometimes be required by the business's policies, but they can't access online stores that aren't compatible with their catalog format. A PunchOut catalog will "translate" your website into a format that procurement software can read, without changing the way your site looks or works for other buyers on the internet. Shift4Shop is compatible with PunchOut2Go, the only dedicated solution for creating PunchOut catalogs from eCommerce websites. The connection can be purchased separately but is included free in our B2B plan.

Sales Rep Management

Sales Rep Management

Selling wholesale means you may need some dedicated sales staff to discuss your products and business with prospective clients. Existing clients will also appreciate being able to talk to the same representative whenever they have a pertinent question. With our Sales Rep Tracking module, you can assign clients to specific representatives and track any commissions the sales rep may earn. Full reporting is also available so you can track and evaluate the performance of a single representative or your whole team.

Freight Integration

Freight Integration

The purpose of selling wholesale is to provide vast amounts of product to businesses everywhere, so you'll need a great solution for transporting it! While Shift4Shop includes the industry's best eCommerce shipping features, the usual methods are not ideal for wholesaling large quantities. That's why we're integrated with freight shipping providers like ReTrans Freight, which simplifies the process and pricing of wholesale freight distribution.

Payment Flexibility

Payment Flexibility

Wholesale buyers are often limited in the ways they can make payment, as their business may restrict them to a certain method. While this is often a corporate credit card, some businesses use NET 30, NET 60, or other variations, some may want to pay with a paper check or money order, and others may have a different method in mind. If you're selling worldwide (or you plan to), you'll also need to accept international payments. Shift4Shop integrates with over 160 different payment providers to ensure you can accept any type of payment necessary, and for those customers that do use a credit card, you can allow them to save their corporate card information for faster future purchases.

Attracting Wholesale Buyers

We briefly touched on the needs of wholesale buyers near the beginning of this guide, such as bulk discounts, fast reordering methods, and certain payment types. We've also gone over the tools you need to offer these features to your wholesale customers. These tools allow you to create the type of shopping experience wholesale buyers are looking for, so simply having them on your website can help them choose you over a competitor.

However, you'll still need to make sure your site is appealing, works well on all devices (mobile and desktop), and communicates the qualities of your brand. If you're using Shift4Shop, you're already ahead of the game with access to our Core Theme Engine, which is the framework on which all modern Shift4Shop eCommerce website templates are based. Some of our B2B tools require a Core theme to work, but all the free themes in our Theme Store are Core and all can be customized for your brand. Using a Core theme will speed up your website and give your customers the smooth shopping experience they're looking for, whether they're a wholesale client or an end consumer.

Attracting Wholesale Buyers

With a vast array of powerful tools for wholesale, B2C, and combination stores, and superior web design geared toward providing the best possible experience, Shift4Shop is the ideal solution for growing your business as a wholesaler.

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Frequently Asked Questions

How can I evaluate if my business is ready to start selling wholesale?
Before you decide to start selling wholesale, make sure your business can handle it. Wholesale buyers will expect you to sell to them in bulk and at a significant discount so they can stock up on your product and sell it at their own markup. If you cannot reliably supply the goods at a price that allows room for the retailer's markup (sometimes 50% or higher), you're not ready to move into wholesale. You need a stable supply chain and profit margins that are healthy for your business.
Do I have to collect sales tax as a wholesaler?
Generally, no — you do not have to collect sales tax as a wholesaler. That falls to your customers when they sell your products at retail. However, this can vary by your location and sales tax laws have been changing to better accommodate eCommerce, so it's best if you consult with a tax attorney or other expert beforehand.
Are there disadvantages of selling wholesale?
Transitioning into wholesale can be a struggle, but most issues can be avoided if you make sure your business is ready (as we described in an earlier FAQ answer). Still, it's normal to have some uncertainty over the process, which is one reason many wholesalers choose to keep selling to their regular B2C customers so they can keep their established relationships.
What about disadvantages of selling wholesale and B2C at the same time?
The main concern of many new wholesalers who continue to sell B2C is that they'll end up competing with themselves, with their own retail sales decreasing as customers start to buy the same product from other stores. However, this will be offset by the income from your B2B clients, and if you have established B2C customers, they may continue to buy from you anyway since they're used to your website. You're likely to keep getting new B2C customers too, as some customers will still buy directly from the manufacturer if given the chance, even if your product is available elsewhere. This is especially common today as counterfeit products are a big problem in some eCommerce marketplaces, so cautious shoppers often go straight to the manufacturer to ensure they're purchasing a genuine product.
Do wholesale buyers want extra information about products?
Wholesale buyers will carefully review the product information on your website, but are also interested in different aspects of your products than the typical customer: while a regular shopper will want to know how your product can benefit them, wholesale buyers will also want to know any pertinent details that could help them decide which products to purchase from you. Having bestsellers featured on your website is a quick way to give them some of this information, but you should also be prepared to answer more specific inquiries. For example, a wholesale customer might want to know how often a particular item is returned or exchanged. Remember they're making an investment when buying from you, so don't be surprised if they exercise due diligence.