How To Become Reseller in 4 Steps (Plus Tips)

By Indeed Editorial Team

Published March 17, 2022

The Indeed Editorial Team comprises a diverse and talented team of writers, researchers and subject matter experts equipped with Indeed's data and insights to deliver useful tips to help guide your career journey.

Reselling can be a part-time way to make extra money or it can be a full-time job, depending on how much time you devote to your project. If you're interested in working for an eco-friendly business, you may enjoy being a reseller. You might also consider this career if you're looking to get rid of old items, such as clothes, start a business. In this article, we explain how to become a reseller, describe what their duties are and provide some tips for success.

Read more: What Is a Reseller? Types and Benefits

What is a reseller?

A reseller is an entrepreneur who buys used or unsold goods at a low price and resells them online or traditional offline retailers. A reseller may sell clothes, furniture or equipment, depending on what goods they can access quickly and cheaply. Online seller marketplaces allow resellers to post their products and market them to interested parties. Resellers can also own storefronts and resell items like antiques, thrift clothing, and home goods. Resellers profit by understanding the market demand for the goods they're selling and the channels they can use to access their target markets.

Related: 8 Great Distribution Marketing Channels for Connecting With Customers

What do resellers do?

Here are some of the roles and responsibilities of a reseller:

Sourcing

Resellers find products to resell by sourcing items. Sourcing is when a reseller or a vendor researches specific items and their market price to determine if they can find the item to purchase at a low cost or a market for the item at a resale price. Resellers may frequent flea markets or other low-cost vendors to find their products. They can also establish relationships with collectors or organizations that want to unload a lot of merchandise for a low cost. Once a reseller has a relationship or a frequent source for finding merchandise, they can find a market for those items at a higher price.

Related: 100 Business Ideas With Low Startup Costs

Pricing

The reseller determines what the price of their merchandise is. In many cases, the products are unique or in small quantities, so they may need to select the price for each unit individually. They consider how much they initially paid for the item, how much the reseller invested in refurbishing or transporting it, and how much profit they want to make. They then calculate that cost with how much a consumer may be willing to pay to find the right price.

Related: What Is Merchandise? How Merchandising Works and Its Benefits

Developing selling channels

Once they have their merchandise selected and priced, they can find selling channels to promote and sell their products. They may sell their products through an online marketplace, where members and other resellers and customers frequently look to find resold items at a more affordable price. These online channels can be specific to a market, like vintage clothing or antique furniture, or have a vast audience. Many resellers sell through social media as well.

Another sales channel may be in person, through a booth or storefront. A reseller can also work with clients individually, selling to collectors or finding specific customer items with particular requests.

Related: 11 Successful Business Models To Use

Marketing

Resellers are responsible for their marketing. They take photos of their merchandise to write copies explaining the product, dimensions, material contents, and quality of the item so potential customers can browse their inventory and feel confident making a purchase. They can also promote their items through marketing campaigns, like any other retailer. They may have branding to promote their business and build trust with their customer base. They also find markets for their products to run analytics and make future sourcing decisions based on sales numbers and target market data.

Refurbishing

Some resellers refurbish the products they sell. Depending on the reseller's skills and knowledge of the item, they may find a quality piece with a lot of resale value but dirty or broken. They can refurbish it to make its resale price higher. Refurbishers can stain old furniture and replace broken pieces. Resellers may want to wash clothes gently to remove stains or odors before selling them to someone else.

Researching

Resellers research their products to understand where they came from, what their value may be and who may be interested in the item now. For example, if a reseller finds a vintage designer piece of clothing, understanding how the designer is, the piece's importance to that designer and the history of fashion can help them convince a potential customer to pay a higher price for the item. Understanding basic facts about the piece, like what it's made out of, where the manufacturer made it, and its size measurements, can also help create a sale.

How to become a reseller

You can follow these steps to become a reseller:

1. Source stock

Find stock you can resell. You can look for products you already own or source from your friends and family. If you have access to cheaply priced bulk items, consider reselling them. Decide what items you want to resell, be it clothing, antiques, home goods, equipment or technology. You may want to find a niche of items you have easy access to where the market isn't over-saturated.

2. identify your selling channels

Once you have your stock, you can find ways to reach your target audience. One of the easiest ways to get started is through an online marketplace. These websites typically have pre-made features to help you display and promote your items. They also have integrated payment systems, which can help ensure all your payments are secure and accurately recorded. You can make an account on one or more of these websites and begin selling your stock.

3. Register the business

You can register the business to get a business license. To register, you need to indicate where the business operates or is incorporated. Registering a business can help protect you from scams and encourage customers to consider the business as legitimate. It can also help you prepare to get your a resale license.

4. Get your resale license

A resale license is permission from the state you live in to sell items without paying sales tax on the items it purchases for sale. The customer still pays sales tax on items they buy from you, and you can send the tax to the state in regular intervals. Some online marketplaces handle this for you, which may be another reason to start with an account. Additionally, a resale license can get you more access to companies you sell bulk items at auction to resellers. For example, a clothing store may sell large quantities of returned or unsold items to resellers, and with your license, you can access those clothes to turn into a profit.

Tips for success

Here are some additional tips you can use when starting a reselling business:

  • Ship quickly. If you're using an online marketplace, quickly shipping your items can be a good way to provide strong customer service and get good reviews on your account.

  • Provide good presentation. Try to wrap your items well so that when the package arrives, the item is in good condition, and the customer is happy with its appearance. The presentation can help you seem legitimate and improve the customer experience.

  • Do your research. Research similar items and what they've sold for in the past. You can make better decisions about which items to buy and what prices to set if you've researched your niche and know relevant price points.

  • Take clear photos. If you're using an online marketplace, use clear photos that present the item as close to its actual appearance as possible. Being transparent about the item can encourage trust in your customers.

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