Creating your own brand including manufacturing is not for the faint-hearted or those without financial backup. But with internet usage globally set to hit an all-time high of 5.3 billion by 2023, is there any other way you join the growing number of internet entrepreneurs?
With many looking to ditch the day job and become their own boss, you might be wondering ‘why should I sell other companies’ products online?’
So we will take you through your options and find out if one way might be the hands-down winner. Before we get into detail, let’s hit the brief.
It’s not always possible to manufacture your own goods to sell to consumers, as it can be costly and is not for everyone. Try selling other companies’ products online by using alternative methods such as direct sales, affiliate marketing, creating a wholesale channel or dropshipping.
Ok now we have the short answer, let’s delve a bit deeper and start by discovering some of the different ways you might decide to sell other companies’ products online.
What are the different ways to sell other companies’ products online?
So although handcrafting your own gifts for a store might seem like a great way to sell online, it’s not for everybody! Of course, there are downsides to any business, but one of the crucial ones, if you make and sell, is purely the time element.
So not only do you have to market, maintain websites, take and fulfill orders you also have to make the goods too! This can come with all kinds of difficulties such as quality and whether you can even make enough goods to fulfill your customer orders, without the cost of premises and staff.
So let’s take a look through some alternatives selling other companies products online.
Direct sales is a way of marketing other companies’ goods, which is often used by well-known brands to sell their products and services to consumers via agents online or selling from home.
A few good examples of direct selling would be Scentsy, Avon, and Herbalife which, along with online selling, also operate party plans.
Some examples of the types of products sold via direct sales are:
- Nutritional supplements
- Lifestyle products
“A few good examples of direct selling would be Scentsy, Avon, and Herbalife”
How does direct sales work?
The way direct selling works is that it removes several links in the chain of traditional retail.
Rather than going from a distribution center and wholesaler, products go directly from the manufacturer to the direct sales company, which then gets passed on to the agent or sales rep. Finally, the product then reaches the customer.
Some of the downsides of direct sales can be very low-profit margins and some direct sales reps can work very long hours.
Affiliate sales ads seem to be everywhere you look these days! Every YouTube video has an ad enticing you to an affiliate link.
The easiest way to describe affiliate marketing is that the company provides you with links to its products. The link can either be sent out on social media or included in blogs on websites. If anyone clicks on the link and buys a product, you get a percentage from the sale.
One of the biggest companies that offer ‘partners’ a chance to benefit from sales is Amazon.
Influencers and social media gurus simply send out the link in posts and will take a cut of each sale.
“The easiest way to describe affiliate marketing is that a the company provides you with links to their products.”
Pros and cons of affiliate marketing
So although this can be a very ‘hands off’ way of making money in a retail environment regarding fulfilling and shipping orders, the lack of control can be a problem. For instance, you aren’t able to establish a customer base, it’s a one-hit sale every time, along with the fact there is no guarantee of revenue, and once again, usually fairly small profits.
Creating your own wholesale channel can be a benefit to retail entrepreneurs who would prefer not to market directly to consumers. Although the influencers of the world may have huge audiences to advertise their products to, it’s not for everybody.
By selling wholesale to other retailers, however, you can still sell to customers if you want to do both.
The way wholesale works is by selling discounted products in bulk to online and other types of store owners, who then go on to ‘mark up’ the goods to a higher price to sell to their customers.
How does wholesale work?
Wholesale was previously thought of as a fairly old-fashioned way of selling goods directly to bricks and mortar stores, but with eCommerce taking the world by storm, it has had a resurgence.
One of the plus points of wholesale selling is that you can negotiate for higher discounts as you are buying in bulk, but the downside is that it can be costly for start-ups or those wanting a cheaper entry to online selling.
“The way wholesale works is by selling discounted products in bulk to online and other types of store owners,”
So for those who are looking to sell other companies’ products online, you might be interested to understand more about dropshipping.
Dropshipping can be a perfect way to enter the online world of retail with many benefits. Although there have been some reports that dropshipping was losing favor by some, it’s certainly here to stay, not least in part after the Covid era, where more and more people were looking for alternative ways to make an online income.
What is dropshipping?
Dropshipping is a way of owning an online retail store and having the order fulfillment and shipment handled by a dropshipping supplier.
Dropshipping allows store owners to delegate many of the more expensive and time-consuming tasks such as order processing, shipping, and storage to a dropshipping agent.
The best dropshipping agents will also offer other services too. These can include warehousing, products you can customize to offer your customers a unique offering, alongside offering a dedicated account manager to help you grow and develop your business.
“Dropshipping allows store owners to delegate many of the more expensive and time-consuming tasks”
The benefits of dropshipping
So not only does dropshipping give you a chance to start off your business empire without very low cost and risk, but it also offers a scalable opportunity for revenue. Let’s look at three of the best benefits of dropshipping:
- Lower start-up costs: In many online businesses it’s usually a requirement to find a large amount of capital or buy inventory. Dropshipping means you can avoid this startup expense
- Wider product range: Instead of concentrating on one product or range, with dropshipping, the sky’s the limit as to the type of goods and how many you can sell.
- Time-saving: One of the most time-consuming tasks for online retailers is shipping their own products. Alongside organizing stock, getting it ready to deliver to your customers can be extremely costly in terms of time. Dropshipping means these tasks such as labeling, packing and shipping can be handled by a third party.
Ok, so now seen some of the benefits of drop shipping other companies’ products online, is there anything you need to get started?
What do I need to be an online seller?
So to become an online seller, it might not have as many requirements as you thought! In its basic form, all you need is an internet connection, a storefront, and some social media channels to market your store to.
Obviously, as with any kind of business, it can sound super simple! But being realistic, you will need to put in considerable time and effort into any way you sell other companies’ products online.
Time to check out your competitors, time to develop your business, and of course, most importantly, time to market your offering.
Although very little is needed in real terms to be an online seller, in order to scale a successful business, it will require time and effort on your part.
And to finish on…
If you want to develop your entrepreneurial skills, ditch the day job and start to be in control of your income, then don’t forget to head over about how HyperSKU can help you build a successful dropshipping store.