Five Minute Friday: Wholesale Buying Isn’t Shopping, It’s Investing

Foreign.

Business can be a lonely game. But it doesn't have to be. Welcome to Boutique Chat where we explore community over competition and how to scale your company with the balance and the happiness that we all seek. We'll hear from product based businesses of all types, retailers, e commerce and wholesale brands, along with industry experts shaping the future of our industry. I'm your host Ashley Alderson from the Boutique Hub and I can't wait to chat.

Hey guys, it's Sarah Burks back with the Boutique Hub and today I want to talk to you about buying wholesale. This is one of the biggest topics that we talk about here at the Hub and one of the most commonly asked questions. How do I get started? How do I buy wholesale? What are some of the best practices? Well, guys, it's more about investing. Investing in something that you are going to turn around and sell for profit. And there's a few things that are really important for you to keep an eye on and focus on. When you are doing the investing, are you going to get it right 100% of the time? No. No one does. Look at any store, any retail store that you've ever been in, they have a sales section that's inevitable. But the key to buying wholesale is utilizing the resources and skills and the knowledge that you have to make the very best decisions for your customers. So let's jump into it. Six tips for buying wholesale. Tip number one, Know your customers. If you don't know who you're buying for, who you're investing for, how are you going to know what products to bring them? So we highly encourage you here at the Hub to do customer interviews. Find out what their needs, their wants, their desires really are, what sizes they need, what fit, feel, function they need, what colors they love, all of those kind of things. Just because you like it or love it or you think it's cute does not mean it's what your customer needs. And remember, customers pay money to have their problems solved. So who's your customer? Who's going to pay you for solving their problem and what do they need? What do they really need? Right. Not what do they think is cute, but what do they really need. That's how you build a business. Number two options. Where do you go to buy wholesale? Well guys, there's a ton of different options out there and I can tell you the Hub is coming out with a brand new platform called Hubventory, which we're super pumped about. But in the meantime, you will have online marketplaces. You have in person marketplaces. I highly Recommend a nice marriage of the two. Why do I encourage you going to market, getting in a physical space with the markets, because that's where all the inspiration comes from. You can touch, feel and look at products. You can see the visibility of their merchandising, get ideas and creativity. That's discovery shopping. That's where you really get your juices flowing and see all the resources that are out there for you in one spot. Major markets include Chicago, Dallas, Atlanta, Louisiana, Las Vegas, New York, and many, many more. Highly encourage you to check out their websites. You can Google fashion markets in any of those cities and fill out the buying registration. All of the information is right there for you. It's very simple, right? And they don't let anyone just into those markets. And that's for your protection. You have to have the proper requirements to be able to buy at market just like you will on any wholesale site online. And yes, I'm all excited about Hubventory that's coming out very soon. There's also Fair and new order fashion, Go La Showroom, and even orange that you can take a look at. My last tip with that on all the many options like I just mentioned, there's a ton. You guys make sure you remember who that customer is and what that customer needs so you don't get crazy with all of the options and just get too many products in for your customer. Right? And go off your game plan, bust your budget. We don't want to do that. All right, number three, buying wholesale. Again, this goes back with who your customer is. When you work with these different vendors, whether it's online, wholesale marketplaces or in person, it's important when you walk into those booths or you go onto those sites to understand that particular vendor sizing. You know, because you're a shopper that not everyone sizes the same. What might fit you in a small in this company might be a large in another company. You know that, but your customer doesn't. It's up to you to provide the right resources for your customer. So when you go to look for a vendor, understand their sizing. Nothing worse than getting in a dressing room or getting an order shipped to your house and you're all excited about it, only to try it on and it doesn't fit. So understanding the vendor sizing, it's all over the board. Next thing, this is tip number four for buying wholesale. Pre packs wholesalers, vendors, they most often will prepack their items. What does that mean? Those size runs that I just talked about, whether it's 2, 2, 2 a pre pack would be 2 smalls, 2 mediums, 2 larges. Or another option is 1, 2, 2 1, 1 small, 2 mediums, 2 larghes, and an extra large. Why is this important? Well, number one, we knew. We learned about who our customer was, right? Number three, we learned what sizes our customer needs. So if that's the case, then we need to make the best decision with these pre packs. If we have a number of extra large customers, does the two to two option really work for us? Or if we have a number of very small customers, does the option of the 1, 2, 2 one pack, the one small, two medium, two large, one extra large work best for us? No, Honestly. Then if that size small fits your customer, odds are we want that two, two, two pack where you're actually going to get two of those smalls. It's all honestly, it changes all the time, but it's good questions to ask. Understand how the vendor works, how their pre packs are run, and Then next tip 5, tip 5 is minimums, minimum buy ins. This goes back to how many minimum pre packs do I need to buy? What is the minimum buy in as far as dollar amount? Can I afford this? Or maybe you fell in love with just one sweater from that vendor and you want it so bad you're willing to break the bank and fill that $1,500 minimum buy in order just to get that one sweater. That's a red flag. That's usually not a good practice. It's really not a good practice. So. But I'm telling you, I work with buyers and I've done it myself that I've fallen into that trap. That's why I make that a big tip here in this six tips to buying wholesale as something not to do, right? Understand those pre packs, understand the sizing, understand the minimum requirements to work with that vendor. Very important. So just to recap before we go to number six, so far we've learned who our customer is, we've looked at all the different options of where to buy wholesale. We've understood our price or our sizing and our pre packs and our minimums. The last thing this is super important is pricing. As you shop around, you are going to find so many different options, right? That sweater that you might have fallen in love with from one vendor, odds are you're going to see either that sweater or something very similar to it all over the marketplace. So when this happens, guys, when you find products that you really like, don't put yourself in a pricing bubble. So here's my tip for that when you go into a marketplace or you're in a showroom or you find something online that you really, really like, ask yourselves a few key questions first. And that biggest question is, what will my customer pay for this retail? If you don't ask yourself that, I promise you, you'll box yourself in. You'll put a ceiling on your price ability. So why is this important? So they say that sweater you really, really like, you look at it and you say, ah, this, the sizing's right, the pre packs are right, the, the delivery is right. All of these things, it looks exactly like what I want. It sounds like what I want when I listen to or I read about the description. Or maybe you're at mark and you're touching and feeling and it just feels awesome. You're saying, oh man, my customer would spend $60 for that sweater. Okay, great. There you go. You think you can, you yourself and your staff can sell that sweater for $60. So now, after you've done that, turn that price tag over and look at the wholesale cost. If that wholesale cost is, say 15 or $20, that's a good return on investment for you. And you've already committed to the $60 retail, right? So look at that markup. If you do the opposite of that and if you walk into that showroom or fall in love with this item and the very first thing that your eye is drawn to is that wholesale price and you turn that over and you see it's 15 or $20, I guarantee you your psychology of pricing is going to price that sweater at $35, $40 maybe. Guys, you've just cost yourself in excess of $20 per item just because you looked at the wholesale price first. So don't do that. So that is my biggest tip when buying wholesale. That is my biggest tip. Don't put a ceiling on your limit of pricing. Figure out what the customer will buy it for first and make sure it checks all your other boxes. And then, and only then do you look to see if it's a good return on investment. All right, guys, I'm Sarah with the Boutique Hub. We are full of all sorts of educational tips and resources for you. If you have any other questions or have more thoughts on this or something else you'd like us to chat with you about, please drop it in the comments below. Have a great day.

That's it for five minute Friday, you guys. I hope you found some quick, actionable steps you can put into play in your business right away. As always, if you're not yet a member of the Boutique Hub. I would love to personally invite you to join us. It's where all of the daily conversations happen. The up to date what is working now in the industry conversations, the latest trainings, trend reports, discounts, resources and of course access to thousands of wholesale brands that you also know and love. So please take a minute, follow the link in the show notes and we would love to invite you to join us inside of the Boutique Hub.