How to Become a Costume Wholesaler
Dabble in dress-up all year long. As a costume wholesaler, you will be purchasing costumes in bulk from a supplier and reselling them to retail establishments. You will be the middle-man who finds the products made in factories worldwide and distributes them to brick-and-mortar stores and online shops. Becoming a costume wholesaler requires only a few steps, but following the proper procedures will ensure you start off on the right foot, so that you can grow more efficiently and successfully.
Other People Are Reading
Instructions
-
Licensing
-
1
Apply for an Employer Identification Number or federal tax ID from the Internal Revenue Service. You can do so online, in person or by phone, fax or mail. The IRS recommends using the online application for faster processing. When applying, make sure you have your social security number handy, as well as the type of business you are starting. In most cases, individuals start out as a "sole proprietor," which is anyone who is running a business himself, as opposed to a corporation or other business entities.
-
2
Note your EIN or federal tax ID in a secure location, including on your computer and in a tangible file. Memorize it as well, if possible, as you will be using it frequently as you begin building your business.
-
-
3
Obtain any additional licensing your state or local government requires. Note the exact types of items you plan on selling. Are you planning on carrying only garments, or will your costumes extend to accessories and make-up? Licensing rules vary by state and also by which types of items you will be distributing.
Finding Merchandise
-
4
Find costume suppliers. Use wholesaler resource websites to narrow down your search. Make a list of each company that includes a contact name, phone number, email address and the supplier's location.
-
5
Request from each distributor a catalog or product listing of the costumes each carries. It should include pricing and lead times -- or how long each item takes to arrive once you place the order.
-
6
Review the listing and determine the cost you would charge retailers for each costume. Calculate your margin, factoring in your shipment costs from the supplier to you. If you will be meeting your target margin, contact the distributor for samples. Please note that the target margin is up to you and should be determined in your business plan beforehand.
-
7
Keep a list of all companies contacted, noting which ones have sent pricing info or samples, as well as the names of those to contact regarding potential orders.
-
8
Create a calendar of when you need to buy specific types of costumes. Based on lead time, calculate when you should purchase costumes for holidays such as Valentine's Day and Halloween, keeping in mind you will need to move through the stock before those holidays. Also include which types of costumes would be applicable year-round, such as children's dress-up items.
-
9
Gather your final selection of costumes into a catalog format that you can distribute to retailers. Buyers will respond faster if you have your contact information -- including an email address and phone number -- in the catalog, as well as a clear pricing list that includes each product's availability.
-
10
Find a warehouse to store merchandise or a drop shipper who will handle order placement for you. In either case, do extensive research to ensure you are working with a reputable company.
Finding Buyers
-
11
Gather a list of retailers that might want to sell your items. Include a contact name, phone number, email address and location for each company. Do not limit your list to costume stores; consider novelty gift stores, comic book stores and toy stores. Note which locations could potentially provide a year-round business.
-
12
Send a catalog to each retailer on your list, and place a follow-up call to set up a meeting. Allow approximately one week for retailers to receive and review your product list before contacting them.
-
13
Gather samples to bring to retailer meetings or to send to retailers, if needed. Take these from your own stock or request them from suppliers.
-
14
Sign an agreement with each retailer before orders take place. The agreement should list the decided payment terms as well as which party is responsible for shipment costs.
-
15
Devise a system for tracking shipments from the supplier to you, and from you or your drop shipper to the retailer. Use money management software to keep track of payments in and out, and to ensure you are on budget.
-
16
Hire additional staff to assist you with bookkeeping, order management and fulfillment, and warehouse needs, if applicable.
-
1
References
Resources
- Photo Credit Hemera Technologies/AbleStock.com/Getty Images
