For years, the middleman has played a crucial role in connecting wholesale clothing manufacturers with consumers. Most of the time middlemen can and will mark something up as high as they want to make a profit, so in this case, you may ask how to cut out the middleman when buying clothing wholesale. Thus, we will give you some advice in this blog.
A middleman is a term that has been used in the clothing wholesale industry for a long time. A middleman is a person who acts as an intermediary between buyers and sellers in a transaction. There is a type of company known as a wholesaler, who actually purchases clothes in bulk from manufacturers and resells them to a retail store.
There are three basic kinds of retail businesses: first, the ones who manufacture their own clothes; second, those who buy their goods directly from manufacturers; and third, those who purchase their goods through intermediaries or wholesalers.
One of the biggest benefits of the middleman is that it allows retailers to focus on their own work rather than the work of the middleman. To demonstrate this, let us take the example of branded clothing wholesale. The middlemen, such as wholesalers, force the retailer to concentrate more on product promotion, sales and service, while the brand manufacturers can focus on developing and producing the most innovative products.
There is a possibility that the manufacturer has the intention to lay off wholesalers and sell their products to retailers or end-users. In this case, the manufacturer must compensate for the retailer's shortcomings, including the inability of marketing skill thresholds. For a manufacturer to achieve full profits, he needs to excel at marketing, sales, customer acquisition, and customer service in both design and production of quality products, which are all inseparable from obtaining full profits.
Most of the time middlemen can and will mark something up as high as they want to make a profit, as long as what they are selling is in high demand. The traditional way of selling has since been disrupted by the rise of e-commerce, leading the way to more direct-to-consumer purchasing, which is a current hot trend now. Therefore, many people turn to look for some methods to cut out the middleman and there are two typical and obvious benefits for you to cut out the middleman.
Buying in bulk is what wholesalers do to make money. The manufacturers will offer wholesalers a lower price if they buy in bulk. In addition, the wholesaler then sells the product to the retail store at a higher price than the one that they buy from the wholesaler. The retailer then stocks the product separately and adds its markup to it.
When you work directly with the fashion manufacturer, your unit price will be cheaper than the unit price you would get if you bought wholesale. Since wholesale suppliers need to recoup the money they spent on purchasing your products from manufacturers, they need to charge you a higher price. Profit is made by charging you higher unit prices than the manufacturer does. Fashion retailers can pay wholesalers as much as twice the cost of the factory. Consequently, retailers and small wholesalers usually buy from middlemen for a high price.
Therefore, when you buy clothes at lower prices directly from factories, you can sell them at lower prices, giving your company a competitive advantage over others. Cutting out the middleman is a good way to help you save money with low cost.
In comparison to purchasing wholesale clothes from a middleman like a wholesaler who purchases the clothes from manufacturers, when you purchase wholesale clothes from the manufacturer directly, you are able to have more control over your brand, price, quality, and quantity than buying through a middleman. Consequently, if you work directly with a clothing manufacturer, as opposed to a middleman, you can access unique wholesale clothes to suit your needs and interests, not just the wholesale clothes offered in the store.
By negotiating private label clothing deals, you can decrease middlemen's commissions, thus increasing profit margins. The other advantage of being able to create your own brand is that you are able to control the prices that you set for your products. Therefore, it is evident that you can have more control over your wholesale clothing orders when you cut out the middleman.
It is estimated that the U.S. wholesale distribution industry generates $6 trillion in revenues annually, consists of more than 300,000 companies, employs more than 6 million people, and accounts for 28 percent of the world's GDP, which is why the wholesale clothing market is so promising.
Today, the clothing industry will confront many challenges related to the COVID-19 situation, the development of e-commerce, and the desire of retailers or small wholesalers and manufacturers to bypass the wholesale distribution channel and to do their business directly with each other over the Internet.
In fact, the internet didn't invent the idea of cutting out the middleman, but the development of internet and some reality has certainly facilitated the growth and practicality of the practice. So how to cut out the middleman when buying clothing wholesale? Here we will give you two suggestions.
1. Purchase Clothing Wholesale Online with Manufacturers
For decades, one of the traditional methods of selling products to customers involved working with wholesalers. Manufacturers cannot afford the infrastructure, manpower, and retail space required to compete effectively against wholesalers.
There's no doubt that the Internet has changed many aspects of sales, making it as simple as a few clicks to get anything you could possibly want to be delivered to your door. It is important to point out that in addition to traditional wholesalers and retailers, new competition such as manufacturers is also attacking traditional distributors, who cannot match their sales prices and lose money as a result.
There is no doubt that distribution models are constantly evolving due to the Internet and the use of websites by small businesses. It has become increasingly common for manufacturers to sell directly to purchasers instead of going through a middleman. As an example, you can look at FondMart, who has integrated more than 5000 manufacturers and suppliers in China.
FondMart is one of the real successes of the online B2B model, and an example of how buyers are starting to question the existence of middlemen. This is what FondMart accomplished by saying goodbye to the middle man. By combining manufacturers, retailers, and certain wholesalers, FoundMart strives to reduce the cost of clothing by reducing the costs involved in clothing wholesale.
With FundMart, it has always been about empowering the purchasers and allowing them to simplify the process of buying wholesale clothing by turning to the Internet. This simplification makes it easier and cheaper by cutting out the middleman when buy clothing wholesale.
2. Deal Directly with Local Manufacturers
In most cases, wholesale purchases are made in bulk and, as a result, you pay a discounted price. If you buy clothes wholesale from a middleman, you're doing business with the person who stands between your store and the manufacturer.
For this reason, you should contact local manufacturers directly. There are several methods you can take in order to do so. If you start with your local chamber of commerce, that would be a good place to start. Furthermore, if you keep in contact with other business owners, you may be able to search the Internet for sources of manufacturers with whom you could partner. You can read the comments to find out what you should search for and what you should avoid. When you are looking for manufacturers overseas, FondMart is an online market where you can find thousands of manufacturers and suppliers where you can cut out the middleman when purchasing wholesale clothing.
Once you have purchased wholesale clothes from the manufacturers, you can then resell them at a higher price at your own store to earn a profit.
For many years, the most popular way to purchase wholesale clothing was through a middleman who would let you choose what you wanted from a selection. In spite of this, now that the development of the Internet has allowed for the expectation of cutting out the middleman when purchasing clothing wholesale, you are able to save money with new methods.
Nevertheless, it is apparent that FondMart understands supply chain and sourcing quite well, so why not start cutting out the middleman by taking advantage of purchasing wholesale clothing at FondMart?