Starting up a wholesaler "research"

michaelw6 · Jan 16, 2023

Hello guys, I've been wanting to start up a wholesaler for quite some time now but I don't have the contacts or the idea how it works.
I know a lot of people who run independent ones and people who work in them. at one point nearly had a team but they all flaked out not knowing about security.
But I've seen it work with some blokes I know doing the same thing.
Has anyone had any experience with this?
thoughts? ideas?
I've also seen a wholesaler near me flop within 6 months!!
Michael

Gavin John Hyde · Jan 17, 2023

you would need a big pot of money to get up and running, and hold a lot of stock.
The more you buy the better prices you get so can maintain margin yet increase profit
A lot of the new ones who last start online with particualr niche areas. such as atomtek/power and data who supply the wced cheap switchgear. they do a roaring trade in the ev installer sector.
Not sure who but one of the big ones has very little stock but just make use of their pricing from rexel and buy the item and have it shipped to customer when ordered. might only make 5% on it but means no mney tied up in stock etc... involves admin of course.

snowhead · Jan 17, 2023

michaelw6 said:
Hello guys, I've been wanting to start up a wholesaler for quite some time now but I don't have the contacts or the idea how it works.

I would have thought the minimum requirement would be to have been or are currently working in a wholesalers at manager / rep or similar level so that you know how stock buying /stock levels etc works.
And or have run a similar business previously.

If you do go ahead I hope you've got some wealthy relatives or friends to back you.

You're going to have to find suitable premises and commit to a lease, which you may struggle to get with no prior business experience.
You'll need vans for deliveries, employ staff and all that involves.
Stock manangement and invoicing systems.
Plenty of stock, some of which you won't get paid for for many weeks, if at all, but you'll still have to pay your suppliers for new stock in the meantime.
And you'll have to paying wages at the same time.
You may find some larger supplies won't supply you due to agreements with their other local customers.

Just plucking figures out the air, I doubt that £500,000 will get you very far at all and you may loose the lot.

Best of luck if you try it.

michaelw6 · Feb 3, 2023

Hmm... don't look too promising, does it?
three men I know started a wholesale together but they all had the background. started small in a cheap unit and grew quite quickly. but as mentioned they had the experience and know-how. also customer base already.

RichardM · Feb 4, 2023

Sorry to be pessimistic but the old adage goes
"How to make a small fortune in (add you favorite business type here)
- start with a large one."
(been there, done that)

Lucien Nunes · Feb 9, 2023

My dad was more of a businessman than I am, but one of the things he pointed out to me as a child was that all the different approaches to making a success of a new business fall roughly into two categories:

a) Offer the same as everyone else, but do it using a better or more efficient method.
b) Offer something different that others can't / won't do or haven't yet thought of doing.

If you don't have a clear idea of which of those you can achieve, you will struggle. Simply doing the same as existing businesses is not a formula for success, because you will be at a disadvantage through lack of contacts, repeat custom, turnover, buying power etc. You need to jump on with either an efficiency hack or a unique selling point from day 1, to counterbalance those disadvantages.