How to Become a Reseller in 3 Simple Steps (2023)

You don’t have to reinvent the wheel if you want to launch a successful business model, or even simply join the ranks of full-time entrepreneurs. All you have to do is become a successful online reseller. Of course, starting your own reseller business via one of today’s popular online marketplaces sounds easier than it might be.

Fortunately, with the tips you find below, you’ll be able to launch your career as a reseller and capitalize on the business infrastructure that’s already present in the digital world. Are you ready to ake your business ideas from intention to reality? Here’s what you’ll need to know.

What is the Reseller Business Model?

First, learn what a reseller is. It’s not quite like your friendly neighbourhood small business, though you could adopt that model if that’s what you prefer. Instead, a reseller business is one where you buy from other manufacturers and retailers, turning those products around and selling them directly to your own customers. If you’re familiar with dropshipping, it’s somewhat similar—although with dropshipping, your role can be even more passive.

A reseller can work on a platform like Amazon or eBay and become a successful online presence relatively quickly. And if you have the appropriate business license for reselling, you may even find that your approach is much more affordable than you thought possible.

Essentially, your role as a reseller is that of the middle man. You’re the distributor who finds the connection between what customers want and where they can buy them. You can also leverage one of the most powerful models in business, which is to buy items at wholesale, then mark them up for a profit when selling them individually.

Why consider reselling as a business model? There are a few benefits you might want to consider:

  • Minimal know how. Yes, you do have to know your markets—what’s trending, what’s not. As a resale business, you have to know what your customers are after. But you don’t have to know everything there is to know about creating the products themselves. You don’t have to think about large-scale distribution. In many cases, you’re using the infrastructure that another platform (like Amazon) already built.
  • Low overhead. It’s easy to build an online store these days. For example, if you were to build one on Shopify, you can build a reseller business from a template with minimal upfront investment. You don’t need to put together a business plan and ask for a loan from the bank. You can simply focus on the customer experience. Heck, you can even get started smaller, such as by selling products on the Facebook marketplace.
  • Minimal barrier to becoming a business owner. You can become a business owner and exploit a fantastic business opportunity that comes with the digital world. And you can do it without having to jump through all sorts of hoops. That’s why many people start out their reseller business as a side hustle rather than jumping in off the deep end. You can choose how much you work on this business.

But are you now going to be looking through thrift stores and garage sales to start your resale business on Etsy? How is it going to work? Let’s dive a bit deeper into what it means to become a reseller and address the basics.

How to Become a Reseller in 3 Simple Steps

If you’re a first-time reseller, then you know that the ability to markup a low cost item on an online shop doesn’t only give you a chance at a great profit margin, but can help you leverage the digital world like never before. But you still need to know the first steps before you start reselling products online. And it won’t hurt to have a solid knowledge of which trends are in high demand right now.

With that in mind, let’s look at the key steps you can use to unlock reselling:

1. Register your business and obtain a business license

Even if you still have a full-time job at the old gig, you should still register your business and obtain the appropriate license. This will ensure that your startup is able to become a successful reseller without any regulations getting in the way of what should otherwise be a legitimate pursuit.

2. Look Up Your State’s Sales Tax Laws

When you register you’ll also need to know what regulations your state puts in place for the collection and payment of sales taxes. You may also find that you need a resale permit to ensure that you have everything you need to sell the type of product that you want to sell. Even if you’re selling something completely innocent and run-of-the-mill—say vintage clothing—you’ll want to double-check this before you get started.

3. Consider Your Platforms

Once you know that you have the rules and regulations down pat, it’s now time to work with the platform that will make it easy to handle everything from sales taxes to shipping costs. That’s where a platform like Shopify or BigCommerce, can do a lot to help you get your small business off the ground. Start uploading the essential information.

It’s true that you might want to think about branding your company as well. But before you do this, make sure that you have a way of testing out whether there’s a market or not. You can always add branding elements—such as a logo—to your store later. What you want to do is get started in the world of ecommerce. Test your ideas. You’ll likely find that the further you go, the easier it is to know your audience and the best branding elements to pick.

For example, let’s pretend you start reselling vintage clothes. But maybe you start noticing that your target market tends to buy more shoes than coats. If you named your business something like “Buy Your Coats with Us,” then suddenly you’ll find that the brand can get a bit confusing.

Where to Find Suppliers for Your Resale Items

Once you’ve looked all the above, it’s time to think about what you can actually sell. The first step in this lesson is to first consider what your business is going to look like. Here are some options to consider as you think about how your business will ultimately end up:

  • Dropshipping. Dropshipping is reselling in its purest form—you’re the middleman between a manufacturer and distributor who can take care of everything except making the sale. You’re the one who makes the sale. The key advantage here is that you don’t have to keep inventory, which significantly reduces the risk that comes with keeping a physical business.
  • Boutique store. An online “boutique” approach is all about selling a vibe. Sure, there are products to consider, but you’ll especially want to pay attention to your audience here. Build a social media presence, for example. You can use this to find people who resonate with your boutique—typically selling items like vintage clothes or antiques. Once you’ve nailed your specific vibe, you’ll have a better sense of which products will tend to sell and which won’t.
  • Specific articles of clothing. Let’s say you want to specialize in a piece of clothing. Some of the top websites in ecommerce are all about finding multiple brands in the same place. People love these types of websites because they make it easy to browse a number of brands. And from your end, learning just one specific article of clothing, for example, can make it easier to find out what people want, giving you a “niche” hook as you look to differentiate yourself and your business.
  • Subscription models. If you’re tired of scratching and clawing for new customers, consider this option: keep the customers around. A subscription model can increase your LAV (lifetime average value) for each customer, which in turn makes it easier for you to build a side business into something more substantial. With a subscription business, you might send out a box every month. Here, your challenge isn’t finding new customers—it’s often looking for ways to reduce the churn on the existing customers you’ve already earned.
  • Consignment. Consignment shops tend to take luxury items and sell them with a specific angle—for example, a consignment shop can deal in used or vintage goods. This is how people can obtain great, high-luxury items without paying a premium for them. Of course, you’ll still mark up your products because you’re the one finding them for resale, but the premise still remains: your customers can obtain a discount by shopping used instead of going to the luxury retailers directly.

You’ll notice that cases like consignment shops do necessitate business licenses—otherwise, you’re looking at “black market” status, which isn’t what anyone wants. To stay in business and thrive at it, you’ll have to obtain the proper permissions first. From there, you’ll be able to lock in with an audience who wants to buy what you have to sell.

What Are Your Next Steps?

Today’s no code or low code shopping platforms allow you to build a shop with almost no knowledge and no startup money. That means that your next steps are all about you taking the initiative. Make sure you have the proper accounts ready to go. Make sure that you have the permissions necessary with state and local regulations—and that you have the licensing and permissions necessary to resell what it is you’re going to resell. Platforms like Shopify and BigCommerce mean there’s little guesswork in how you set it up. You can simply find the products, upload the details, and get selling.

You’ll also find that these applications help you with a wide range of potential issues you’re dealing with. At Shopify, for example, there’s a huge marketplace of apps you can tap into. This marketplace of apps lets you add on features that you might need as your company grows. This will give you the assistance you need to scale your business as you have the money to continue to fund that scaling.

Call it a “virtuous cycle.” If you launch your business as a side hustle at first, then you don’t have to rely on that income to live. You can put the income from the business back into the business, reinforcing its strength and expanding its capacity to sell. You can also put that money into marketing to amplify the messaging of your business.

With resale, there’s little stopping you. All you need to do is follow the right steps, obtain the right permissions, and you can be off to the races.

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