Wholesale Sourcing for Home Business Success

Is wholesale drop shipping the right model for your small, work-at-home based business . . . . ?

Are you seeking a legitimate home-based business selling goods via eBay or from an online store? Have you heard how easy “easy” money is made dropshipping wholesale goods?

Perhaps you have found our site through Google, Yahoo! or Bing and come looking for information and answers to questions on how to set up a home business using wholesale dropshipping as a model. When you Google the terms “wholesale” and “dropshipping” and look through the results it seems that everyone wants to convince you that dropshipping and/or selling wholesale products on Ebay is an easy way to make money from home. All you need to do is find the right product suppliers.

Finding the right sources is vital as if finding the right niche market, but let’s not put the cart before the horse. To be honest, the basic business model is simple, but there is really nothing “easy” about running an eBay business or any other home business that is consistently successful. EBay can still make you a good living, but it is merely one approach and a very narrrow slice of the home business pie. And drop shipping products, wholesale or otherwise, won’t make you any money if you haven’t done your market research to be sure you actually have a market and if you don’t have reliable product sources. That doesn’t mean it can’t be fun, that you can’t love it, but any business, home or otherwise, requires due diligence and work to make it profitable. The question is, are you up to the challange?

Let’s face it, the quest for online, home-based income has become a sort of Holy Grail among those seeking greater personal freedom and financial autonomy. Internet marketers hoping to make money online at home and hearing the stories of those who made fast cash promoting Google’s AdSense program, and myriad other gimmicks and schemes may very well believe all of the Grail talk to be true. Many Internet marketers also love to talk about how easy it is to make money with dropshipping. Don’t be fooled by glib talk. The people who got good enough at it to call it easy got there through persistence and following a business plan. Selling goods online or on Ebay using the wholesale-dropship model is not a gimmick, product sourcing is not a gimmick, online retail sales is not a trick. Running an ecommerce business selling physical products–and product sourcing for your home business is vital to that–is a solid way to make money, but not as a gimmick, scheme, or trick. And the truth about success is that it rarely happens quickly and all at once.

A wise and successful Internet marketer once said that to be successful in business, you have to be good at business. Meaning that quick online income and legitimate home-based business success, online or offline, are not necessarily the same thing. Almost anyone with luck can make some money, but it takes business skill and knowing where the “gold” is to keep your money. In the area of Internet marketing–and business in general–it is important to understand the difference between a gimmick that makes money and a business. AdSense, for example, is a gimmick, but ecommerce–running your own online store–is a business. In ecommerce, a key issue is product sourcing, and so one of the biggest wholesale and dropship so-called “secrets” is where and how to source your products, and that is where wholesale drop ship directories, suppliers, and distributors come in.

Goods and Services

Wholesale sourcing (find out what product sourcing and the Wizard of Oz have in common), drop-ship directories and distributors are a vital element of the equation. Unless you are a scammer, you really only have two things to offer through legitimate home business. Goods or services (or both). If you want to offer goods, then you have a choice of physical products or digital products. Here, we are concerned about physical products, so we can either stock our own inventory and ship from our business, or sell goods that will be shipped independently by a manufacturer or distributor.

Wholesale Product Sourcing

Wholesale sources will supply our products in the first instance above, where we stock our own inventory. There is a great deal of brouha and noise about how to tell a real wholesaler from a middleman. Let’s get this out in the open right now. A real wholesale business will always require proof of a state retail sales tax permit. Any business saying or implying that it is a wholesaler but not requiring a sales tax permit from you is not a true wholesaler. The term, “middleman” or “middlemen,” generally refers to these sorts of businesses, that is, retail businesses charging discounted prices but misrepresenting themselves as wholesalers. (Keep in mind that there are many legitimate businesses selling discounted goods who are not true wholesalers. The “middlemen” I am referring to attempt to mislead you into thinking that they are are real wholesalers.)

A moment ago we made reference to the sales tax permit. The sales tax permit, sometimes referred to as a resale certificate, is simply a license granted by your state that allows you to buy goods for resale without having to pay sales tax. Anyone can get a sales tax permit from their state of residence; it is easy to get, and generally costs nothing. So don’t fall for “middlemen” who charge a fee to help with this. (More about Business Permits)

A true wholesale directory will provide you with a list of companies able to source your business at wholesale prices. Even though you can do the research to find wholesalers yourself, there are some very good directories available for purchase. The best of these update their data base of suppliers on a regular frequent basis and also provide forums so that you are always aware of the current “word on the street”.

Now, although a real wholesale company will always require you to have a state retail sales tax permit–and you will need this if you have a true home business–don’t reject a company just because it may not be a true wholesaler. The important thing is whether or not the price is right for you to make a profit. There are also companies, such as liquidators, closeout specialists, and jobbers, who may sell below wholesale price and do not require a retail sales tax permit. Examples of such companies are sav-on-wholesale.com and liquidators.com.

Drop Ship Product Sourcing

A drop shipper is a manufacturer or distributor who stocks the inventory and mails it out to your customer under your company name. You sell the product at whatever price you set, pay the drop ship supplier and keep the difference. Some drop shippers may require membership fees, some may require minimum purchases, others may mark the price of the product up from the wholesale price. When researching drop shippers, it is important to establish whether or not the drop ship price will allow you to make a profit. One other point to keep in mind is how and where you intend to do your selling. Drop shipping might work just fine in one environment but not in another, for example.

Drop shipping is often touted as an easy way to sell on eBay because the drop shipper is responsible for inventory and shipping to your customers. Drop shipping is still effective, and many sellers are doing very well. As mentioned above, your selling environment is key. However, the eBay market place is so competitive that you really have to research your product and drop shipper to verify that you will be able to make a profit. A reliable drop ship directory can be a very important resource. However, it is vital to do the research on your product, the environment in which you plan to sell, and on the wholesale and drop ship sources you plan to use. Again, the best wholesale drop-ship directories help you out by verifying the integrity of suppliers they work with.

If you are brand new to the area of wholesale and drop ship product sourcing and are starting from scratch, you are at a disadvantage because you may not know how to evaluate the information you are presented with, and so you are not sure how to determine what’s good and what’s bad.

With that in mind, we do have two recommendations for you. Neither one will set you back very much, and we think they offer tremendous value for the price. Each requires a one-time only payment. The first directory, Salehoo, allows access to a list of more than 1000 wholesale, drop ship, liquidation-closeout and other low cost suppliers. Through this list of contacts, you have potential access to thousands of products. Also available is the Salehoo forum. The forum may be its most valuable asset. You not only have at your fingertips the forum archives, but you can plug in to a very active network of other buyers and sellers. You can find out more, here:

Salehoo Global Directory of Wholesale Distributors

The second directory is for those of you who know that you want to focus on media, primarily DVD movies. The Jillian Entertainment Guide is simply the best and still the best list of wholesale, dropship. and liquidation-closeout DVD sources that we have yet to find. And we have looked. I say this with such certainty because I own the list and, as I mentioned above, I have looked. The price of the Guide is probably no more than the cost of a movie, drinks, and snacks for you and a date. But if you are considering selling DVDs on eBay or through ecommerce, this will give you wide range of contacts including the major studio sources and the major wholesale houses distributing to retail outlets throughout the United States. These will be the same sources used by some (not all, of course) of the eBay power sellers. Find out more right here: