Guide To Start An Online Reseller Business

Are you an aspiring entrepreneur looking for business ideas? What if we suggest a business that can be started instantly? And requires barely any investment? And to top it all, you can select your profit margin? Doesn’t it sound too good to be true? But there is one business opportunity that ticks all the above checkboxes and is an ideal business idea for new and budding entrepreneurs. And that is the online reseller business. 

What Is An Online Reseller Business?

A reseller is usually a company or an individual (merchant) that purchases goods or services with the intention of selling them rather than consuming or using them. And this selling is done for a profit. 

It can be termed as a supply chain management method in which the retailer directs their suppliers to ship directly to the retailer’s customers without themselves purchasing or keeping any of the stock. The reseller business essentially makes you, as the reseller, the middleman between the manufacturer and the customer.

When online channels are used for this reselling business, such as via various reselling sites and platforms or via a WhatsApp business group, it is termed as an online reseller business. 

The reseller dropship business model has the advantage of being economical, thus making it an excellent choice for budding novice entrepreneurs. Also in an online reseller business you can sell a variety of products and expand the business into diverse sectors too. For example you can start an online reseller business of clothing and further diverse to include accessories, jewellery, footwear, handbags, etc. Other popular products that are popular among online resale business include home decor and furnishings such as bedsheets, pillow and cushion covers, lamps, lights, etc., decorative items and artefacts, plastic wares such as organisers, etc, and even resale of tools and equipment commonly used. There are a number of things that can be sold via an online reseller business.

Difference Between A Reseller And A Distributor

 A distributor is someone who purchases the various products from the manufacturer and then sells them to the end user. A distributor could even supply the goods to numerous resellers. A distributor has a closer relationship with the manufacturer from whom they purchase the inventory and further sell it. A distributor makes an investment towards purchasing the inventory and thus feels a liability as well as responsibility to sell the goods.

An online reseller business on the other hand does not purchase the inventory but is the main dealer between the manufacturer and the consumer. As an online reseller business owner you do not need to create your own products but can choose from a wide range of products to resell. A reseller has no contact or personal relationship with the manufacturer. Also a reseller does not have to make an investment or take the responsibility of the stock. 

These are the basic differences between a reseller and a distributor. 

Advantages Of Online Reseller Business

The online resale business has several advantages as discussed below.

• Instant Set-up

An online reseller business can be set up almost in no time. Budding entrepreneurs can start selling the products almost immediately once they decide to start the business. All they require is an online channel through which they can sell the products, such as an online reseller platform or WhatsApp business account along with the manufacturer’s product images. 

• Vast Range Of Products

A reseller does not create any products but can choose from a wide range of products to sell. An online reseller business has the advantage of selling a variety of products, almost anything they like because they are not bound to any particular manufacturer or any particular product that they have invested in or are maintaining an inventory of.

• Zero Inventory

The biggest advantage of the online reseller business is that you do not need to maintain any inventory. In fact you do not need to purchase any items at all. All you have to do as a reseller is to ensure the purchased item goes from the manufacturer directly to the customer once they item is purchased through your business.

• Easy To Diversify

The online reseller business can expand and diversify easily into other segments without expensive inventory fees, additional costs or high shipping costs. For instance if are reselling clothing you can easily diversify into tools or even pet supplies, or any product which has a high demand as well as margin. 

• High Margins

One of the reasons for the popularity of the online reseller business is the high margins that can be set for the products. As a reseller you can choose to set any margin in order to make a profit. High demand products can be sold at a higher margin , however, you must keep a watch on the industry standards for product pricing to not go too overboard.

• Low Financial Risk

Unlike with a distributor business, in an online reseller business you do not have to purchase any products or maintain an inventory. This makes the business one that has a low financial cost. You only pay for goods as consumers order them through your reseller online platform, and that too usually after the consumer makes the payment. Therefore your financial risk in the online reseller business is very low.

Guide To Start An Online Reseller Business

In order to start an online reseller business you must keep certain factors in mind to help with the business, especially while setting it up. The pointers discussed below will help guide you to start your own online reseller business.

• Choose a low-competition products

As a reseller if you choose to sell a product which has a lower competition than you can set a higher margin for it. Additionally, you will be one of the few ones supplying it thus making the customers looking for the particular product come to you. 

• Price the popular products well

As an online reseller business you can choose your own products to sell as well as the margin of profit to make per sale. When selling popular products, price them well in order to make more sales. However, in order to outdo the competition do not price the products very low as it’ll eat into your profit. The product price, with the margin, should cover the cost of goods along with the cost of marketing, employees (if any), expenses such as online reseller platform fees, and more. As long as the product prices makes sense compared to the industry standards, you don’t need to underprice yourself. Therefore pricing the products well is tantamount.

• Create a website

An online presence for an online reseller business is a given. Many might consider selling via reseller sites while others might rely on WhatsApp business tool. And both these are highly effective methods but a website helps create a good impression for your online reseller business and also helps build the trust of the customers. The website can either only talk about the business and the various products on offer or also act as a channel for sales. You can always avail social media management service to help set you up for a successful online stint for your business. By availing the service you can concentrate on other aspects of the business as the online presence and optimising the website is taken care of under the deAsra service. 

• Sell quality products

It is important to sell quality products under your online reseller business, irrespective of whether you have a high margin or a lower one or whether you have a website or sell without one. The products sold through your business create an impression of the kind of products and service you will provide in the future too. The product quality reflects on you and the impression creates a recall value, thus making it vital that you sell quality products to create a positive image for the business and to make satisfied customers come back to you repeatedly.

• Create Ads

In a field as competitive as the online reseller business it is important to create Ads to draw the attention of the customers. Your strategy can include more ads on Facebook as only your ads will be visible and the interested customers can click immediately to place an order. Google Ads are effective too but need to draw customer’s attention amongst the competition. You can also download Social media marketing checklist to know how to use the social media platforms to market your products effectively.

You can even advertise and sell through WhatsApp. Online reseller business covers 5.4% of the total online e-commerce market segment in India and WhatsApp is an app that almost all resellers and customers use actively, thus making it an effective sales channel and advertising tool.

• Build a brand

By creating a brand for your online reseller business, you help the business create a positive image for the customers and thereby help it grow and expand. The brand does not relate to the products but to the business model. You can create good and engaging content that will keep customers engaged and help build a brand. Content can include interesting videos of the products along with blogs. Consistent videos and blogging for the brand helps the sales grow overtime. Further the blog content can be monetized by retargeting your blog traffic.

These are some of the factors that will help guide your online reseller business to start and establish it. For other entrepreneurial related queries and assistance with online presence and utilising it effectively, you, as an entrepreneur, can always seek the guidance of deAsra Foundation.