How to Start a Successful Reselling Business: Tips for Beginners

For both beginner and seasoned business owners, online resale is a thrilling prospect, particularly if you don’t want to do the research and development of your own goods. Through your own online storefront and third-party sites like eBay, you can resell wholesale goods as well as specialty and second-hand goods.

Since reselling can be competitive, it’s critical to get off to a good start. To help you succeed in this e-commerce sector, we’ve outlined nine essential actions on how to start reselling.

A Reseller: What Is It?

Online resellers purchase goods from manufacturers, distributors, liquidators, thrift shops, and other retailers, then resell them online. Online reselling is done by:

Social media and personal websites, as well as online markets like Amazon and Etsy
branded applications and websites for businesses
Some internet retailers focus on a certain kind of product, such as the supermarket items sold by Hive Foods. Others sell a wide range of categories on a single site, like Overstock.com.

Nine Steps to Launch an Internet Reselling Company

Following these nine steps will put you on the path to a successful internet reselling business, and you will get the answer to how to start reselling for a profit. To assist you in creating a company plan, establishing financial systems, and adhering to regional regulations, we have conducted the necessary research.

1. Determine what you wish to sell by conducting market research first. Because they are more expensive, high-demand products are good resale items.

To identify popular and well regarded things to sell, you can examine well-known e-commerce platforms such as Amazon and Alibaba. Well-known reseller markets consist of:

Clothing, particularly women’s apparel
Products for babies, tools, and cosmetics
Accessories such as purses and bags
Electronic devices and accessories

Read product reviews to gain insight into quality while you do your study. Steer clear of subpar products as they might harm your brand and reduce sales. In order to choose how much to charge at your own store, you should also consider pricing.

2. Pick a Model of Fulfillment

You must choose how to fulfill customer orders after determining what to sell. Three primary choices are available to online resellers:

Order Fulfillment in-house

You control all inventory and oversee the entire process, including packing and shipping, if you fulfill orders internally. If you have a small inventory that mostly consists of unique or specialty items, in-house order fulfillment is the ideal option. See our comprehensive guide on e-commerce stock management for more information.

Dropshipping

With dropshipping, you can begin a dropshipping company if you don’t intend to keep inventory but yet want to control the front-end e-commerce platform. Rather, you will accept orders from customers via your web store and send them to a supplier. The products are owned by this third party, which also manages order fulfillment.

Since you don’t have any inventory, dropshipping is a reasonably priced way to get started. For the kinds of goods you intend to offer, you will need to establish your online store and find a seller.

Dropshipping has drawbacks, such as less control over the products, which could lead to problems with quality or stock. Furthermore, dropshipping businesses frequently charge exorbitant prices for each unit, which lowers your profit margin.

Logistics Provided by Third Parties

For your resale business, you can contract with a third party to handle shipping, fulfillment, and inventory. In contrast to dropshipping, the third-party logistics (3PL) approach requires you to pay for storage separately and own the goods.

If you wish to resale wholesale goods in bulk without keeping and distributing inventory, 3PL is the best option. Compared to dropshipping, you’ll most likely save money per unit, but it’s crucial to look for exorbitant costs when choosing your third-party supplier.

3. Locate Vendors

When choosing a provider, take into account following factors:

Quality: The best products should be offered by your preferred supplier. Verify that none of their products are outdated, fake, or of lower quality.
Cost and minimum quantity: Strive to strike a balance between the minimum order quantity and the price per unit. Without going overboard, you want to be able to sell the goods for a profit.
Customer support: In times of crisis, you require a supplier who is easily accessible. Before signing a contract, read reviews and look at customer service options.
Numerous dropshipping and wholesale marketplaces, including Alibaba, SaleHoo, Tundra, and Handshake, can assist you in locating reliable suppliers at affordable prices.

Additionally, you can source goods by contacting your preferred brands. For example, find out if small local businesses provide wholesale prices if you want to establish your own snack reseller business.

4. Draft a business strategy

How you will generate revenue as an internet reseller is included in your business strategy. Although this document can be brief, it should contain the following:

A synopsis of your company
A comprehensive inventory of your goods and vendors
Your sales strategy and marketing plan
Short-term objectives and a growth strategy
Estimates of finances
Your logistics and operations strategy

As your business expands over time, your business strategy is subject to change.

5. Attend to Financial and Legal Issues

It’s critical to comprehend your financial and legal responsibilities completely before launching any firm. Since the particular requirements differ by city and state, you should research local business and tax regulations.

You must register your business with the government in the majority of places. Generally speaking, you can create a corporation, limited liability business, partnership, or sole proprietorship.

Additionally, you might have to register with the tax office in your area. Sales tax must normally be charged and remitted by online resellers. Additionally, you might be required to pay a value-added tax or a goods and services tax.

By applying for a free employment identification number (EIN) from the IRS, you can sign up to pay federal taxes for your company. This number is what you’ll use to open a business bank account and file taxes.

6. Create a Website

Although social media and third-party markets can be used to launch your resale firm, this may restrict its potential for expansion. Rather than using other platforms, I advise you to create your own website with a unique domain name.

Using website-building tools to construct a professional-looking online business is simple. Your company should have a secure, user-friendly, and operational online store. These elements support brand confidence among potential clients.

All of your products will be added to your webstore once your site is up and running. Prioritize writing detailed product descriptions, adding excellent product photos, and providing precise price details. These elements draw visitors and give the website a trustworthy and authentic appearance.

7. Establish a Method of Payment

You must set up a payment mechanism before your internet resale business can begin selling. Accepting a large range of payment options, such as bank transfers, digital wallets, and credit cards, is made quick and simple due to digitization,

To guarantee a flawless experience for your clients, you can use pre-made templates to personalize your branded checkout page. If you would rather use our user-friendly tools to develop your own customized platform, we also provide complete API integration.

8. Begin to sell

Your company can formally open once your website and payment system are operational! You must advertise your e-commerce business to prospective clients in order to begin generating revenue.

A lot of resellers begin their marketing campaigns on social media. For instance, you can incorporate shopping capabilities and visually showcase your products on Facebook and Instagram.

Keep an eye on how well your products are performing as your firm grows. As trends shift and you discover what works and what doesn’t, don’t be scared to make changes to your inventory. Equipped with this understanding, you can expand your internet reselling enterprise and boost earnings.

The Benefits and Drawbacks of Launching Your Own Reselling Company

Knowing the benefits and drawbacks can assist you in determining if reselling makes sense for you. The following are a few benefits of this business model that will help you in how to start reselling products::

Minimal initial outlay of funds if dropshipping is used.
Once you have clients, scaling is simple.
Incredibly adaptable as a full-time profession or side gig.
The freedom to choose your own profit margins and prices.
Simple business plan.

Additionally, you should be mindful of these potential drawbacks:

There is fierce rivalry in the competitive sector of online reselling.
Locating a trustworthy source might be difficult.
The availability and quality of the products are beyond your control.
Building significant revenues and a devoted consumer base takes time.
It takes a significant amount of time and effort to get started.

In conclusion, is it right for you to start an online reselling business?

Researching and sourcing products, building a website, and reaching out to potential clients are all part of an online resale business. As an ecommerce entrepreneur, you can make money after you launch your company and have a following.

Online reselling has its challenges, just like any other business. You may overcome these obstacles and create a profitable internet reselling business by following our methods.

Tools like Swoopa can help you stay ahead of the competition by giving you real-time alerts for postings on marketplaces like eBay, Craigslist, OfferUp, and Facebook Marketplace. With faster alerts, you’ll be the first to message sellers and conclude profitable deals before your competitors ever see them.

Frequently Asked Questions

How may credit card payments be accepted by an internet resale company?

Online resellers may easily accept credit cards and a variety of other payment options.

Is it worthwhile to resale as a side gig?

Reselling can be a great side business if you prepare and plan ahead. Using social media and markets, you may get started with little money. As a low-risk approach to get started, you may attempt dropshipping or reselling items you discover in nearby thrift stores. Once you start earning money, the side project can end up becoming your primary source of income.

Which goods are most easily resold?

Cosmetics, equipment, baby supplies, and clothing—especially women’s clothing—are the easiest items to resell. Profit margins are often substantial for well-known reseller categories that are constantly in demand. To determine where to concentrate your e-commerce efforts, you might look at popular products and categories on other marketplaces.

What is the salary of a full-time reseller?

The majority of full-time resellers earn between $31,500 and $81,000 annually, according to ZipRecruiter. The wealthiest earners receive over $300,000 yearly, while the lowest earners typically make about $14,000. Your prospective earnings from this kind of business endeavor will increase with the amount of time and money you invest in your reselling enterprise.

What is the price of becoming a reseller?

The kind of product and fulfillment strategy will determine how much it costs to become a reseller. Dropshipping doesn’t need you to purchase inventory, so you may start for less than $100. If you intend to purchase in quantity, the cost will go up because minimum wholesale purchases range from hundreds to thousands of dollars.

How to Start a Successful Reselling Business: Tips for Beginners

A Reseller: What Is It?

Nine Steps to Launch an Internet Reselling Company