Since the jewelry and accessories industry is constantly growing and changing, there are many opportunities for wholesalers. This is especially true as eCommerce grows and more jewelry retailers emerge.
In this article, we want to understand what is a jewelry wholesale business, and the 6 secrets of a successful wholesale distribution business.
What is a wholesale jewelry business?
A wholesale jewelry business sells articles of jewelry in bulk to retailers that will resell the items to consumers.
Since wholesale jewelry suppliers sell in bulk, they offer their products at a much lower price point. This allows retailers to resell for a higher price and make a profit.
Some wholesalers manufacture the jewelry in the house, and others act as a middleman between manufacturers and retailers.
How to start a wholesale jewelry distribution business？
1. Study the industry
Before you dive into wholesale jewelry distribution, it is a good idea to understand the jewelry industry. There are many opportunities in the jewelry industry, but there are some potential challenges. Finding success in this industry requires alertness and agility to stay on top of rapid changes.
For example, the jewelry industry depends on many social and pop culture trends. A specific jewelry item or accessory may become a hot commodity overnight. This is greatly swayed by social media and influencer culture. If a photo or video goes viral, an article of jewelry featured in that post may see a rapid increase in demand.
2. Create a business plan
Wholesale jewelry distribution comes with many moving parts, so it is best to start your business with a well-drawn-out plan. You should outline what your business will be, what you hope to achieve, and how you will achieve it.
Creating a plan for your wholesale jewelry business will give you direction as you navigate through the startup process. Different organizations, including the SBA, have templates for business plans, but there is no need to put together something formal unless you are presenting it for funding.
That said, let’s take a look at a few things that you should address in your business plan.
Prioritize Customer Relations
The number one way to not only sustain but to grow your wholesale distribution business is to make your customers your priority. Your goal should be to provide both valuable products and a shopping experience that brings your customers coming back.
Shift Towards B2B eCommerce
In recent years, many B2B retail transactions have been conducted via the Internet. However, retailers have caught up with consumers and started shopping online. This means that as a wholesaler, your best choice is to follow this transition.
If you have considered your direction-jewelry, you have to choose a trustworthy supplier, such as Nihaojewelry.
Finances and budget
It takes money to make money. There will be several initial investments that you must make to get things started. Make a list of all of the expenses you need to get started and how much you will need on a monthly or quarterly basis to sustain operations. How much money will you need to make to break even? How many sales would that require?
Compare these expenses to how much money you have available. Will you have enough to self-fund, or will you need help?
Document internal processes
Consistent processes that are optimized to best serve your business and your customers are key. Document the processes that make your business possible, such as daily tasks, employee on-boarding, lead generation, marketing strategies, order fulfillment, etc.
The goal with this is to create tangible instructions for anybody to step in. Having your processes documented will also help you maintain consistency in your operations and help you see where you can tweak to make improvements if necessary.
Diversify Your Sales Channels
Relying on leads from one single source is not ideal as you grow your wholesale distribution business. Putting all of your eggs in one basket can be devastating if something happens with one sales channel.
Diversifying your sales channels will help you diversify your customer base and open doors to new opportunities. It is also wise to continuously tweak your strategies for specific sales channels to keep things fresh and cutting edge.
As we mentioned, listing your products on a B2B eCommerce platform is a great place to start, but you’ll want to build a network in addition to that. Depending on the nature of your specific business, you may benefit from social media or email marketing, as well.
Going to conferences, trade shows, expos, and other professional events is a good way to kindle the appropriate relationships.
3. Create an online storefront
To sell your products online, you’ve got to create an online storefront. There are a couple of ways to go about this. You can create a storefront on a B2B eCommerce marketplace or you can build an independent site of your own.
It is a good idea to do both. Why? A storefront on an eCommerce website will drive more traffic to your product listings. This is because the most popular eCommerce marketplaces double as a search engine, so the platforms show your products to buyers that are looking for them. On the other hand, the benefit of using your own site is that you have total control over the branding and user experience.
4. Determine your prices
You can’t set your prices too high or too low. You have to find a competitive middle ground.
First, identify how much each unit costs you whether you’re manufacturing it yourself or if you’re sourcing it from a third-party manufacturer. This is the absolute lowest you can go without losing money. Next, take a look at your competitors’ prices and the demand for the product. How much are the selling equivalent units for? How much are retailers willing and able to spend?
you can apply the basic formula for wholesale price calculation:
the average cost of goods manufactured + profit margin = wholesale price
Remember, in wholesaling, prices can be negotiated. Add some extra padding in the pricing if you want some room to come down on prices without compromising your profit margin.
5. Set Minimum Order Quantities
Minimum order quantities (MOQs) are used as part of a tactic that many wholesale businesses use to make sure that every order is worth their while. This seems like a very simple tip, but it could save you a great deal of time, money, and headache in the long run.
Setting an MOQ will often help you build relationships with customers that truly have a demand for your products, rather than people who are trying to get low quantities at wholesale price.
6. How to use Nihaojewelry.com to wholesale jewelry online
Using a B2B eCommerce marketplace can be a great help in exposing your brand to new buyers and entering new markets.
Nihaojewelry has its own factory and all the products offer producer prices. Our platform provides a variety of tools and methods designed to help you grow your business. We have set up VIP level discount rules, which give you more discounts based on your sourcing amount.
Using the Nihaojewelry website, you can manage your orders at any time through our website or our mobile application. We also have automatic translation and currency conversion tools, as well as 6*24-hour customer managers, which makes cross-border procurement possible.
Becoming a wholesale jewelry distributor takes a bit of time and effort, but it is certainly possible with the right preparation and execution. With the help of an eCommerce platform like Nihaojewelry.com, you can kickstart and grow your business. Contact us today to start selling.
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