Management September 19, 2017 Last updated September 14th, 2017 3,796 Reads share

Step By Step Guide To Set Up A Reseller Business

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Aspiring entrepreneurs are often caught in a web of ‘analysis paralysis’ that prevents them from taking that first step towards setting up their own business. There are a number of challenges that come with this. But the biggest hurdle is capital. Setting up your business requires capital to first validate your business idea, then procuring equipment or alternately paying a manufacturer to build the product for you. One can never be certain if the customer would buy this even after you spend money on this venture.

This is why reselling can be a great option for first time entrepreneurs. With reselling, you are not building your own product. Instead, you find manufacturers who can white-label their product for you which is then sold at a mark-up. In other words, you avoid expensive capital investment that is often a necessity for entrepreneurial ventures. Here is how you go about it.

Step By Step Guide To Set Up A Reseller Business

Find A Reseller

The ideal reseller is one who does not own a branded product themselves but instead does contract manufacturing for other businesses. These resellers are okay with using excess capacity to make the product for you. Another factor that you must look into is the turnaround time for manufacturing and shipping your product. If you want to avoid capital expense in getting the product made and stocking inventory, you should be looking at a made-to-order arrangement. That is, you place an order with the manufacturer after you get paid by your customer. Long manufacturing times could seriously jeopardize your relationship with your customer. You should hence pick a product that fulfills the following criteria:

  1. Has quick manufacturing time
  2. Does not require too many customized tweak (that require the manufacturer to schedule a separate run for your products)
  3. Can be locally sourced

Your reseller too should fulfill a few requirements

  1. Must be located in close proximity to you or your customer group
  2. Should guarantee a turnaround of less than two days
  3. Should be okay with a white-labeling arrangement

Finding a reseller is the most exhausting part of operating a reselling business. The next few steps are relatively easier.

Build a website

The next step is executing your go-to-market strategy. You may take the retail or wholesaling route to reach your customers. But these strategies can take months or sometimes even years to reach fruition. It is highly recommended that you start direct outreach to customers through your website. There are a number of online commerce platforms that you could make use of to build your online store. You may also look into these small business hosting providers who have quick installation features for eCommerce. This is especially useful for entrepreneurs who may not have the technical know-how to build and launch their own website.

If you do not want the hassle of operating your own website, you may also look at selling your wares directly over a marketplace like Amazon. This is however not ideal since you may already be operating on wafer-thin margins and the Amazon commission and fulfillment fee could make the business non-viable.

Setting up social media

Social media is an extremely important component of selling online. It is a common misconception that social media is only useful for industries like fashion or art where the visual appeal can increase impulsive purchases. Social media can also be very important for the stereotypical ‘boring’ industries. Social media accounts lend credibility to your business and prospective customers tend to look at your social media profiles before they decide to purchase from you.

Setting up your Facebook, Instagram and Twitter accounts is pretty straight-forward. Getting your first thousand followers can be quite challenging. The trick is to engage with active users with low follower count. These are users who are ready to follow you. Once you acquire your first few hundred users manually, your network gathers virality and acquisition becomes easier. Also, at this point, your media profiles become credible and trustworthy in the eyes of a prospective customer.


Advertising is an inevitable component of selling online. While strategies like SEO or social media marketing do help in converting visitors into customers, these are organic and can take a long time to show results. As an entrepreneur, you must be seeking quick validation of your business ideas and advertising helps in this case.

The first step is to identify the right platform to reach out to your target customer base. If you are selling an established product, Google Adwords can help you find the most targeted visitors for your product. This can however be expensive depending on your niche and it is important to strike a balance between the cost you are willing to pay per click and your margins.

Other strategies like Facebook advertising can help you reach out to a niche audience but may not always be ideal since your customer is not intent on buying products when they find you on Facebook.

The ideal strategy is to avoid trying to convert your new visitors but instead try and channel them into a sales pipeline. Once in the pipeline, your visitors become leads who may then be retargeted with emails, phone calls or even personal meetings in order to turn them into paying customers.

Customer service

The final piece in the puzzle when it comes to setting up a reseller business is customer care. Regardless of who makes your products, the onus of providing a delightful customer experience lies with you, the seller. Create a seamless customer service channel that integrates email, phone call and also social media channels. As a reseller, you may not have sufficient control in the product specs or delivery timeline. Consequently, marketing and support is where you should throw all your focus on. Customers love working with businesses that are honest and transparent about their fails. Earnest customer service also helps you build a reputation that begets more orders and is thus an important step towards true entrepreneurship.

Reselling may not be for everyone, but can be an inexpensive way to launch your own product business. If you are an aspiring entrepreneur, a good strategy would be to launch into reselling and evolve to making your own product when your customer base grows. Some of the largest brands in the country started off this way, and there is no reason why you cannot succeed with a similar strategy.

Vic Anandan

Vic Anandan

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