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As a handmade seller, you may find that your cost for materials is cutting into your profit margin. When we first start a craft business, we are usually making just a few items. But as your business grows, you may find the need to purchase your supplies and materials at higher quantities. This is when you’ll need to look into purchasing wholesale.
But buying wholesale takes some research. There are a lot of scams and low quality sellers out there. Knowing where to look and what to look out for will help you navigate this world.
Let’s get shopping!
Most states will require you to have a tax ID in order to purchase wholesale. This number is not the same as the EIN or Business ID number that you use to identify your business on your tax returns. But you will need the EIN in order to get the Tax Exempt number that you’ll need in order to purchase wholesale.
Your state will be the one to issue the Tax ID for you. Go to your state’s individual business center website, and find their directions for “sales tax exemption”.
With the Internet, you have access to a multitude of wholesale suppliers. Take your time to research websites and compare their pricing.
Most wholesale suppliers have a minimum order amount, so you’ll need to have enough money to invest in your wholesale supplies when ordering.
Don’t forget about Etsy! There are a lot of wholesale supply sellers on Etsy that may have lower minimum order amounts. And a lot of times, their prices match or beat the larger wholesalers!
I have a starter list of reputable wholesale suppliers further down in this article.
Wholesale and trade shows are another great way to source materials for your business. You can look up trade shows that may be in your area on Google.
Check out Bead Fest in Pennsylvania as an example. (For obvious reasons, many of these shows are not currently scheduled but will hopefully start up again in 2022.)
So how can you tell if a website is legit or not? There are a couple of ways to check them out before you send them your money.
Search the name of the website or supplier on the Internet to see if there have been complaints or posts about them.
Check their reviews - if they have low reviews with lots of complaints, this is a huge red flag. If there are NO reviews, on their business or even on the products they sell, this may indicate they aren't a well-known supplier.
See how easy it is to contact them. They should have a dedicated phone number for customer service, as well as an email address. If you have a hard time finding this information on their website, don’t order from them.
Legit online wholesalers will ask for your Tax ID. If they do not ask for this number, this is another red flag that they might not be a good choice.
Some wholesalers will send samples to prospective customers, so if you have the chance to order samples, it would be a good idea.
If you can’t order samples, then do a deep dive into their reviews. You will be able to tell their overall quality by how others have rated them in the past.
You will also want to check their policies for returning items that are not up to quality standards. Look for their product guarantees and what kind of returns and refunds they offer. If you’re stuck with bad quality items that you can’t return for a refund, that is a lost cost that will cut into your profit margins.
Once you’ve done all your research, approved your samples and ordered your supplies, be sure to keep your favorite suppliers in a list so you have an easy, go-to source for your materials.
Here are some popular wholesale websites to check out to get you started:
Once your business starts blooming and you have a high demand for your handmade products, sourcing materials from wholesale suppliers can help you keep your costs low and profit margins high.
Make sure your whole business is set up for success! Take a look at my Craft Business Kickstarter - a complete, step-by-step PDF guide to walk you through setting up your business.