How to Distinguish Between a Fake Wholesale Distributor and a Real Wholesale Distributor
You can save a lot of time, money, and trouble by learning to spot a fake wholesale distributor. There are several things to watch for when researching a potential wholesale distributor. Whether you are attempting to find a wholesale distributor to be your base supplier for your home business, or you are just looking to add a few new items to your catalog, you need keep an eye out for the certain signs of a fake wholesale distributor in order to avert disaster.
If you discovered that your wholesale distributor's website can be found in a major search engine, the probability is high that they are not an actual factory direct source. This is because most wholesale distributors do not have a large enough budget to include internet marketing of their products. They will mainly just have contracts with a few large companies whom they ship products to on a regular basis. They have no reason to spend money on internet marketing for their products, because the parent company that actually makes the products will oversee all of the advertising. The only job of a wholesale distributor is to provide a warehouse for the products they get from the factory and to ship them to the clients who are purchasing them for resell. As you can see, it would not make any sense for these distributors to spend money on marketing their products. That is why if you find a large website brimming full of various products for resell, the chances are excellent that it is only a middleman who is buying the products in bulk, marking the price up to create a profit margin, providing a drop shipping service to you, and winding up with you doing all the hard work for even less money.
Yet another sign that the distributor is a fake is if they require a membership. Some will even try to charge a monthly fee for you to do business with them. As with the advertising, this simply does not make any sense either. If you are purchasing products from a real wholesale distributor they are generating a profit from the items you are ordering. Would it make good business sense for you to make your customers or clients pay a monthly fee just to be able to purchase your products in your store?
Additionally, a real wholesale distributor will have to have your federal tax id number and your resellers permit in order for them to do business with you. They require this in order to avoid having to charge you sales tax. When a potential distributor asks you for this information, you can rest assured that they are a legitimate factory direct dealer.
One trick of a fake wholesale distributor might be to claim that all you need to do is simply fill out a W-2 form and provide them with your social security number. They will tell you that when you sell any of their products they will mail you a check each and every month to pay you commission. While not necessarily a bad thing, this sounds too easy, and the "easy" way is frequently the hard way. In this type of offer, you must take in consideration just how many other people are selling the exact same products on the internet at the exact same low prices. This makes it very difficult to sell products from these types of dealers.
In order to successfully run an ecommerce home business, you have to eliminate any middlemen and find a way to source products in bulk. For example, a drop shipping supplier, regardless of whether they are a real factory direct source, will most likely charge you an increased rate for their products and shipping services because you are not purchasing items in bulk. To be successful in this business you must find the best price for the highest quality products, and the only sure way to obtain those low prices is to source the products from a real bulk wholesale distributor, one business to another. The easy road is the one most often traveled and you will come to find that it leads absolutely nowhere.
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