Why the Reselling Industry Is on the Rise

Reselling is a broad industry filled with enticing opportunities for savvy business leaders, and its recent rapid expansion makes it even more exciting to explore.

What Is Reselling?

Reselling is a general term that applies to many industries. It involves the purchase of products or services directly from a distributor or manufacturer and selling them again at a markup to businesses and/or consumers.
Undoubtedly, you’re already familiar with retail, which is the largest form of reselling, as it enables buyers to purchase a quantity of goods and resell them to customers through digital or physical shops.
There are other types of resellers, including:

  • Drop shippers. Like retailers, drop shippers purchase products from manufacturers and resell them. However, drop shippers usually do not manage their own inventory; instead, they sell items (typically online) and convey orders to manufacturers or other retailers for distribution.

  • Channel partners. Exceedingly large companies, like Cisco and Microsoft, tend to ally with smaller regional businesses called channel partners. Though channel partners are smaller, they are better equipped to sell goods, while the larger manufacturers focus on innovating and producing.

  • Value-added resellers. Most popular in tech, value-added resellers (or VARs) improve upon the items they resell to benefit their customers. In addition to certain products, VARs might provide useful services, support, or complementary products from other vendors.


How Do I Start Reselling?

Reselling is safe and legal as long as you follow the proper laws and vendor guidelines. For individuals, once you purchase an item, it is yours to do with what you wish. That’s why no companies are trying to shut down thrift stores or prohibit garage sales.
However, there are a few wrinkles when you decide to resell as a business. Unless you operate as an official reseller ― one who has secured the knowledge and consent of applicable vendors ― you cannot sell original warranties on products or use trademarked logos or names to advertise. Doing so will undoubtedly result in costly legal battles that will stall your reselling business before it starts.
There’s a better way to break into the business of reselling that doesn’t entail covert ops or potential lawsuits. As with any business, reselling requires research and planning to execute successfully; here are a few steps to get you started:

  • Draft a business plan. Above all else, your reselling business is a business, which means you will need a plan to guide your decisions. Learning about successful resellers’ strategies might be useful.

  • Find your product. Resellers don’t resell just anything; every reseller has a niche, and most do business with specific types of products. You should look for products or services that pique your interest, that you already know a substantial amount about, or feel comfortable becoming an expert on.

  • Find your vendor. Not all vendors (or manufacturers) are created equal. No matter what, you should seek professional counsel while you review potential merchant agreements to ensure you can tolerate the terms and conditions.

  • Learn about your channel. Often, you will become a member of a broader regional reselling network, which can help you stay organized and connected during your early years. Channel partners usually have some agreements regarding competition that you should learn before you begin attracting clients.


Why Does Reselling Work?

Reselling works for companies who want to make a profit without having to develop or manufacture products of their own.
Unbeknownst to many, manufacturers of some of the most popular items don’t have sales departments of their own. Major tech companies, in particular, are too focused on developing new technologies to have time to dedicate to managing in-house sales and marketing teams, and juggling the needs of customers from all over the world.
These vendors will instead partner with regional reselling businesses that have the time and resources to provide exceptional customer service. In this case, all three parties benefit as vendors see their products distributed around the world with no marketing or sales costs, customers receive the attention they want and need, and resellers make substantial profits.
It’s a synergetic relationship that works wonders.
Note from The Mogul Mom:

For more on getting your business retail ready check out these resources:

Find & Manage Sales Reps
Selling to Retail Stores
Selling to Retailers Mastermind Group
The ‘Get Retail Ready’ Guide and Workbook
The Reseller Toolkit


Tiffany Rowe

Marketing Administrator at Seek Visibility
Tiffany Rowe is a marketing administrator who assists in contributing resourceful content throughout the World Wide Web. Tiffany prides herself in her strong ability to provide high quality content that readers will find valuable. She enjoys connecting with other bloggers and collaborating for exclusive content in various niches. With almost two years of experience in blogging, Tiffany has found herself more passionate than ever to continue developing remarkable content for all audiences.

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