Supplier fees to watch out for

Before dealing with any manufacture, wholesaler, or supplier there are a few things  to know. This will also help you spot when a retailer is trying to act as a wholesaler. Ultimately you want to cut out as many middlemen as possible in the order process as this will give you a cheaper purchase price and increase your bottom line.

An ongoing monthly fee?

Why would a wholesaler who is trying to pick up a long-term customer charge them an ongoing monthly fee? Remember you will be the one who is selling their goods and making money for them. Possibly if you came across a monthly fee you are looking at a wholesale/manufacturer directory and not a individual reselling company.

Public reselling.

most wholesalers typically do not sell direct to the public. The reason for this is they prefer to sell their items in bulk. If you find a so-called ‘wholesaler’ reselling directly to the public (at wholesale prices ) they are most likely an over glorified retailer and you will end up paying too much to purchase from them.

Minimum order quantities or MOQ.

Generally a minimum order quantity is placed so that the supplier can sell more units and receive more money per order. As a dropshiper this may pose an issue as you are wanting to sell single units to end users. After you’ve done a due diligence on the supplier could be worth offering to prepay them in advance if it means they can directly send in one unit to customer. This may help to build a better credit and trust with the company so in the future you may not need to do this.

Order fees.

Sometimes you might come across a supplier who will charge an order fee. Depending on the amount of this it is probably reasonable as sending individual units is more costly and takes more time than bulk sending items to a location.

 

 

 

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