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Wholesale refers to a business-to-business (B2B e-commerce) model where, instead of selling products individually to buyers, a business purchases products in bulk from manufacturers, stores them, and then directly sells them to the retailers.

What is wholesale meaning in business?

In wholesale, a person or company purchases products from manufacturers and then sells products in bulk to various companies, businesses, or retailers for onward sale to customers, either directly or through a supplier.

The main aim of wholesale is to sell products for a lower price as they are selling in bulk and which reduces the handling time and costs also reduces stock (In stores).

A meme on wholesale

The wholesalers are like middlemen who sell mainly to retailers, other merchants, and commercial industries and basically, they buy for resale or business use.

Wholesale can also refer to small stores that purchase products from a wholesaler, and then sell them at your own store at a little higher price to make a good profit. This higher price is known as the retail price, and it’s what customers will pay when they purchase something from your store.

Konigle's bulk price editor tool to change prices in bulk.

In operating an e-commerce store, changing prices in bulk for lots of products (may 100s to 1000s) is a big pain. It takes time and is extremely error-prone. So that is why konigle launched Shopify Bulk Price Editor which helps you to Bulk edit prices, run scheduled promotions, and roll back prices with one click.

What are the elements of wholesale?

There are three main elements present in all wholesale processes.

Manufacturer: The manufacturer starts the whole process he is the first element that actually creates something to sell.

Wholesaler: A wholesaler act as a middleman who distributes goods in bulk from manufacturers to stores. Buying in bulk allows wholesalers to purchase the goods at a discount or wholesale price and resell them to stores at a little higher price.

Stores: In wholesaling, the store owners purchase a specific quantity of goods from a wholesaler and sell them to their customers (Buyers) such as something (Eg, T-shirt, watch, etc) selling on the Shopify store.

Benefits of wholesale

From Bulk to the Hulk meme on wholesaling

In wholesale, there are lots of benefits and advantages here are some:

1. Save Money:

Buying goods in bulk can save you a lot of money with the help of discounts that wholesalers get for bulk orders. You can get items for less price and sell them for more.

2. Build a Network:

In wholesaling, you need a network of suppliers who can handle your store requirements from time to time. The supplier should deliver goods on time, maintain the standard of items, and honor the business relationship in the future.

3. High Profits:

Wholesaling is a symmetrical process and that's why the profits you are getting are very predictable. For your store, you can purchase goods at a low price (Bulk price) and sell them to customers with higher margins.

To calculate a successful margin you can use Konigle's Profit Margin Calculator are quickly find your target cost and product price for products on your shopify store based on your desired profit margin.

Konigle's profit margin calculator tool

Growth in store: Over time, you become an expert by selling the best items at your store. No matter what your Items catalog is, you can understand it with the help of an efficient sourcing and supplying system and you can increase your inventory as well.

How do wholesalers work?

The wholesale e-commerce process involves many steps from the overall distribution process. Here is an overview of how wholesale e-commerce works:

  1. The e-commerce store owners approached wholesalers for the number of goods.
  2. After store owners receive goods, unbox them, and stock them for sale.
  3. The store owners sell the items to end customers at a higher profit margin than the wholesaler’s selling point.
  4. The next thing is wholesaler continues supplying the stores with the right amount of items, based on sales data and requirements.
  5. The wholesaler and store owners both watch sales trends on either side of the main supply chain. Wholesalers analyze the trends from their suppliers; store owners analyze trends from their wholesalers.

Frequently asked questions