Reselling business or online reselling business is one of the most famous and desirable ways of business over the internet.
For many people, there is always a hindrance working behind their minds related to the aspect of generating new ideas and working on that from scratch, then doing the proper analysis to take this to a next level.
But in case of this kind of issue, the online reselling business model can be the total rid of all sorts of problems or difficulties you are thinking or facing, in the domain to start a business.
Nowadays, everything is getting impacted by digitalization. For that, every business wants to move one step further to make it digital and to get the maximum reach possible.
And for that, an online reselling business is the best choice between them and the other character of the play – who is the reseller.
What is Online Reselling Business:
We can easily understand a brief idea related to the online reselling business by the name itself. Basically, an Online reselling business model works as a middle man between the consumers and manufacturers or retailers and sells the ready-made products to the consumers.
A reseller generally sources his products under a brand or platform from the suppliers mainly. Manufacturers or wholesalers are the people who can be easily associated with that. Sometimes middle-scale retailers are also approached as a supplier.
An online reseller mainly sells that ready-made end products to consumers, from the supplier under a homegrown brand. Sometimes, online resellers can also get their products listed on various eCommerce sites and platforms and can offer various no of products under the roof with their business idea.
Now after knowing what actually online reselling business idea is, now there is a question which pops in the mind of many is that, then what’s the difference between online reseller and distributor.
And you can get all your questions answered in the next section.
Difference between Online reseller and Distributor for reselling Business:
After knowing the basic idea related to online reselling business, one may think that reseller also performs in the same way as a wholesaler or distributor does. In both cases, both parties buy products from the manufacturer and deliver them to the customers.
But in the actual aspect, there are many differences about their functionality for online reselling business which can be best clarified with the inventory management requirement and deals with the manufacturer.
In a normal business, a wholesaler or distributor mainly deals with the manufacturer related to bulk orders, and they also hold a large storage place or warehouse to store that huge quantity of products. And then supply those directly to the next part of the supply chain or retailers, but not to the end customers.
But in the case of a reseller business model, an online reseller of a reselling business doesn’t have to bother about inventory management. They just work on the basis of demand and supply and store only a few quantities based upon customer’s demands or requirements relate to future availability.
They mainly work as a middleman between the manufacturer and end customer and in between the market the products to boost the selling quantity which is desirable for both – the reseller and manufacturer, and it is most welcomed in the online reselling business.
The reseller also doesn’t hold a stronger relationship with the manufacturer as much as a distributor holds. An online reseller also purchases a very little quantity than a distributor but on a very frequent basis. A distributor also gives the manufacturer assistance related to branding, marketing, labeling, things for improvement, and many more.
But in the case of resellers, they don’t provide any kind of such marketing, improvement assistance, or after-sales services. They only deal with the things to sell to the end customer. A reseller can also be free from any kind of quality assistance of a product, the manufacturer has to take care of this for the end consumer.
Reselling Vs. Drop-shipping – which is better:
With getting so much information and differences between resellers for online reselling business and distributors or wholesalers, now there may be another question which can also come related to shall I go for the reseller business model or with drop-shipping.
To address this, you get to know the differences between them.
Drop-shipping is a way of doing business where you get the order from the end consumer and then directly transfer it to the manufacturer, and then they care of the entire shipping process and delivers with your brand label. And in most of the cases, as the order are of single quantity or very less in numbers, the profitability is not that high.
Whereas in the case of a reseller business model, there may be a requirement of stocking a few quantities of goods based upon the profitability as well as considering the future prospect. But as you directly deal with the manufacturer and ship it back to the consumer, there always lies an opportunity to gain handsome profit in the case of online reselling business.
Based upon the above descriptions of two business models and their functionality process, an online reselling business idea always wins the game, but one can also enter and prosper in drop-shipping as well with an online reselling business.
Is online reselling business a good option for starting a business:
Reseller business model is always a good option to start a business in this digital world, and it can be started based upon fully physical presence, or incomplete online mode, or with a blend of these two.
As the total reseller business actually based upon an existing model but in a higher transformation, so it omits most of the challenges which one may face for starting a business. So, when one decides to state an online reseller business, it provides them the benefits of both categories – a typical reseller and of having an online presence.
Here are some of the points about the positive notes of a reselling business and to clarify more insights related to why it is a good option for starting a business.
1. Easy to implement business idea:
The main success story of a business doesn’t depend upon the business idea, but on the execution of that.
In the case of the Online reselling model, it is really easy to implement from any phase and does not require heavy skills to start with it. As it also doesn’t need that much kind of licensing or any kind of regulations, it can be tried for experimental purposes too.
2. Can we start with small amount of money:
As this business idea can be started with a very small amount of money or even with no investment, it opens a door for the people too who don’t will to go with a large sum of capital to start a business.
Reselling business eliminates the headache of handling inventory and its variable costs and all such other costs are taken care of by the supplier, it became a very friendly business model to start with.
There may be a requirement of investing a small amount for building a social presence, for the marketing of the brand, and for building an online platform like a website or application for the consumer. But all of these are very small compared to establishing a physical business.
3. Multiple product offerings:
The online reselling business model enables you an option to list multiple products in your platform and offer it to the various spectrum of customers as per their needs.
Offering a large number of products also helps you to test what is working for you, identifying which types of products are fast-moving, which are slow-moving, which are on the top of demand in a specific season, and many more.
When you get a chance of experimenting with a single thing from multiple directions, it increases the success rate of your business.
If you’re interested, You can also go to our eCommerce store and check the product offering.
4. Offers flexibility and versatility:
Starting with an online reselling business idea gives you the flexibility to try and implement a various range of products, services and not only those aspects only but also gives you a chance to implement it with other types of media of online marketing.
The online reselling business idea gives you enough versatility in terms of niche section for your range of products or works altogether. Here are some of the mentioned categories:
- Fitness products and accessories
- Stationery items
- Gift items
- Makeup and cosmetics
- Pet foods and others
- Electronic goods
- Home appliances
5. Easy to grow as a reseller for online business:
As Online reselling business is based upon online and most of its functionality lies with the digital media from promotion to marketing, branding to customer conversion – there always lies a huge scope for rapid growth in this reselling business.
One can expand his business without just putting a penny, all one needs to do is tie up with multiple manufacturers of those products and then have to list them on the site and then all is set to deliver to every corner where you wish to.
Introducing some loyalty campaigns and referral programs is easy to implement if there is an online presence of a business and as it is totally based upon online, thus it can reach the level where you wish to bring that.
How to start online reselling business:
Now after getting too much information related to the online reselling business, its main differences from traditional distributorship and drop-shipping, why start, Is it a good choice to start an online reselling Business?
You are pretty much interested in knowing what is the process of setting up an online reselling business and the important aspects to take care of for smoothening your future prosperity.
If you still want to know more and clarify the future scope of digital marketing, then you can check this blog.
Here we are going to discuss the process of starting a reseller business model as well as key points to consider.
1. Decide the business specifics for reselling business:
Reselling businesses have huge market sizes, consisting of many subdomains. And all of these subdomains differ in their aspects in various ways. So, it is important to decide the right kind of business specifics before going to start the online reselling model.
This can be easily identified with the help of analyzing these factors.
Reseller Industry of your choice: The first and foremost aspect to consider where to work and is it right to work there or not is based upon the sole question of the reseller industry.
How big it is in terms of market value? Customer’s demand for the products of that industry, frequency of orders, average order book in that industry, any imposed restrictions or certifications needed to work in that, how easy it to get in touch with manufacturers – are some of the basic but important questions to address before considering any specific industry.
Target Audience: Audiences are the key factors for being successful in your online reselling business.
So, from the very beginning, you have to take care of various aspects and considerable points of a potential audience, how to approach them, How to make them loyal customers? How to end up doing the conversion of your products.
Deciding the proper target audience further helps you to channelize the communication channels, product pricing, and forming marketing campaigns strategies effectively.
2. Select the right kind of supplier:
As the whole business model sticks with the fundamental aspect of selling products to customers from suppliers or manufacturers, so it is very crucial to select the right kind of supplier for implementing your reselling business.
Before selecting the supplier check for his reputation in the market, product quality, shipping time and process, after-sales services, and other points whichever you find necessary. And then enter with making a proper contract for the safeguard against both the parties.
3. Product sourcing for reseller business:
This is one of the most essential steps in launching and implementing an online reselling business. These things deal with selecting the mediums for your sale channels.
There are mainly two types of mediums for selling products. The first source is going with local sourcing channels and then sell via them. These sourcing channels generally help you to get a higher profit margin but comparatively less volume to sell.
Some of the channels of it include mainly your family members, relatives, friends, colleagues, social media groups, etc.
The other souring channel is to go with various reseller apps or websites or from different platforms. There are many platforms present over the internet which help one to get himself to register and then offer the products by listing under a catalog and adding the price of that.
Then the customer can order their products from those platforms. The best part of using this sourcing channel is that one can easily sell a high volume of a product even with a low margin which can help you to develop good brand awareness among the mass and forming the marketing strategies in these types of platforms are comparatively easier than the others, in starting an online reselling business.
4. Setting up a communication channel for better reach:
After setting up with products and platforms, the main point of focus still lies with the aspect of targeting the right audience.
Setting up the right kind of communication channel can take care of every possible aspect of branding, marketing, conveying information about the products, upcoming offers, or any kind of engagement media.
As it is a reselling business model so, Facebook and Instagram are the right ways to communicate with the right kind of audience and then converting them to customers by sales closure techniques and running marketing campaigns.
One can also go for creating a YouTube channel and then promoting the products, giving reviews, descriptions, specifications, updates related to any information.
Blogs are one of the effective media to communicate with the audience by addressing the hot topics or resolving the doubts of many queries and then promoting your product as a preferable choice or solution. These types of solutions can really help to promote your product as well as increasing brand awareness.
5. Marketing is the key factor of success in Online reselling Business:
For every business to reach a high an effective marketing always plays a key role. And when it comes to online reselling business it plays a very significant role in promoting your brand, marketing the products, and in the end increasing the sales volume.
The main type of marketing strategy is based upon product prices and loyalty offers. Some of them are –
- Free delivery service
- Loyalty bonus
- Referral discounts
- Lower pricing than competition
- Limited time offer
- Exclusive deals for a specific event
- Flash sales
Discounts on providing testimonials and reviews
There are other strategies of marketing too, that can be done easily with the help of digital marketing and running the advertisement campaigns on various social media platforms.
If you want to know more about digital marketing, visit our business website.
6. Integrating a payment channel:
For a reseller business, online payment is the most essential thing. It helps you to maintain a positive cash flow in your business also ease of payment for the customers as well.
So, it is advisable to add a proper payment gateway service from a reputed brand that mostly covers all the basic needs and clarifies all sorts of major payment-related issues from their end.
The payment channel should be based upon the ease of customers with the high-end user interface.
7. Competition analysis plays a major role for a reseller in online business:
Nothing can teach more than the competitors working in the same field as you.
So doing the right kind of competitive analysis, finding out the ways that work best for them and integrating them with adding some more, checking what went wrong, and then refraining from those are the major takeaways from the competitors.
So, this is the complete overview and step-by-step process of setting up an online reselling business, how it works? How it is different from drop-shipping, traditional distributorship, and future prospects as a whole. As for better results in the online reselling business, digital marketing plays a crucial role, you can check this blog from here(Digital marketing blog) and get a wholesome idea about it.