Wholesalers and drop shippers can both be great sources for wholesale fashion for resellers. Both types of wholesale vendors can offer really good deals on closeout merchandise. Since each type of supplier works based on a different supply system, there are advantages and disadvantages to working with each one. In order to make a decision from who to purchase your store inventory from you need to have a good understanding of what each type of business does, and the reasons why you would want to use one versus the other.
A wholesaler is a vendor which supplies merchandise based on an upfront payment or credit period. This type of business will deliver the products directly to the reseller at a low rate, but will generally not send the merchandise directly to the end consumer, since the low prices that the wholesaler charges are based on volume purchases. The prices are as low as they are since it does not offer added services above fulfilling the orders placed by the boutique. For example, a Nigerian boutique can visit a New York wholesaler like my business CloseoutExplosion.com which is located in Brooklyn, make its own selection of office suits by Tahari, and have its shipment sent freight collect to its shop in Lagos. The shop owner can expect to pay rock bottom closeout prices, but will see an assortment of different items whenever she visits.
A drop shipper will have a wide selection of wholesale items, sometimes in the thousands, at good wholesale prices, but will not be able to charge as low as a wholesaler can because its expenses to fulfill all the individual small orders to the end users can be expensive. Imagine a drop shipper having to fulfill hundreds of orders a day for different individual items on behalf of eBay sellers who are all placing different orders at any given time of the day. This type of operating requires a sophisticated computer program, the latest e-commerce technology, and a highly professional and efficient sorting and packing operation. The benefit of drop shipping is that a reseller does not have to stock any products, and only needs to pay for them after he or she has received the payment from the customer. The disadvantage is that the reseller will be competing with thousands of other resellers who all have access to the exact same products and at the exact same price as anyone who deals with the drop shipper.
I have personally always preferred to purchase and hold my inventory, even if I had to start out with a small quantity, this way I could obtain the liquidation pallets at the lowest possible price, and eliminate the chances of my competition having the same wholesale wear for their customers. While every system has its pluses and minuses, I believe you need to carefully examine which option will realistically allow you to build a profitable business for yourself, and I have determined that by having an actual physical inventory I can better serve my customers who need to stock their shops with the latest brand name clothing, footwear, handbags, and accessories.
