In my recent essays in ETR on starting your own import-export business, I’ve focused on the business-to-consumer track. You find suppliers and manufacturers, buy their products for pennies on the dollar, and resell them online to customers in the U.S. (or Europe, South America… wherever you live) at a huge mark-up.
But there is another approach to the import-export game that can be just as – if not more – lucrative: supplying imported products to retailers.
There are an estimated 3.7 million retail gift stores in the United States and Canada, according to InfoUSA – a fraction of the 175 million consumers online. But because each order to these stores will be in the dozens, you could make more money from one deal than from a whole year of selling to individuals. Your initial investment will be higher. But we’ll show you ways to make it as low as possible.
To get an idea of how a business like this might look, check out the story of Kole Imports (www.koleimports.com). The company was started by two brothers in 1982. They sold car stereos and tools at flea markets. Before long, they decided to import the merchandise themselves to save money – and soon realized that becoming wholesalers could be very profitable. Taking advantage of the boom in dollar stores across the country, they quickly became one of the top suppliers to discounters in the U.S.
Revenue figures aren’t available for this private company, but it’s estimated they make more than $50 million annually.
Now you won’t become a supplier to Walmart or Dollar Tree – at least not right away. The scale of those businesses is just too large for a first-time importer. And it would take some time to reach the level of Kole Imports.
But there are plenty of small and medium-sized retailers out there that you can deal with. Think of non-chain dollar stores, shopping mall outposts specializing in low-cost goods, and so on.
For example, there is a small gift shop a few blocks from my house that sells cheap jewelry, kids’ toys, women’s clothing, and more. That’s the kind of place you would target.
Initially, they might not be receptive to your offer. After all, they have established relationships with other suppliers. But business is business. So they will be receptive to you… if you show them you can save them money by bringing in the products they want at lower prices.
They will tell you which products they are interested in. You then go to Alibaba.com and find the manufacturer with the best price on those products. You get a quote from the manufacturer and submit it to the retailer. As the “broker” in the deal, you take home a percentage.
Every retailer will have different needs, of course. But out of the estimated 22,000 products on discount store shelves, some are hotter than others. These include:
- Pet toys
- Plastic cups
- Cell phone accessories
- Birthday party supplies
- Office supplies
- Cleaning products
It may not be glamorous to supply basic items like these to retailers, but the market wants what it wants. And if you can meet your market’s needs, the opportunity to make money is there.
Tomorrow, I’ll give you some resources for finding retailers. And I’ll give you a quick-start guide to show you how to approach them so they’ll do business with you.