How to Determine Wholesale Prices
Advertising campaigns with glossy ads featuring deep discount sales or offering their wares at wholesale prices sparks the interest of the savvy bargain hunter. Whether you are purchasing items for your business or are a consumer watching the household budget, knowing if merchandise is being offered at wholesale prices will require a bit of research and a few phone calls, as well as conducting your own market analysis of price comparisons.
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Instructions
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Determining Wholesale Prices For Consumers
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1
Run an Internet search for your product. Search for manufacturers that offer wholesale prices and that bypass the retail cost. Keep in mind that wholesalers must include a mark-up margin even if their factory sells directly to consumers in order to create a selling profit.
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2
Compile pricing data and compare the average between each manufacturer. It is best to select a minimum of five wholesalers in order to arrive at an average cost. Look at country of origin tags. Generally items made outside of the U.S. cost less to manufacture and are produced in significant quantities, which reduces the wholesale pricing significantly.
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3
Research the same product online for deep-discount sales. For example, a product which has an 80-percent mark-down price can be relatively close to what the retailer purchased the item for. The retailer needs to cover its cost, but will be willing to significantly reduce the merchandise instead of carrying it over on their inventory for the following quarter.
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4
Compare your research data. Usually the lowest price within your market analysis can be determined as the wholesale cost.
Determining Wholesale Pricing for Wholesalers
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5
Run an Internet search of your product. Make a list of factories where the product is being produced. As a wholesaler, you will be able to contact several factories inquiring about manufacturing costs. Select a minimum of three to five factories to contact.
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Compile data of your product's actual manufacturing cost. Keep in mind that the wholesaler also receives a mark-up from the factory which is manufacturing the product. Compare pricing between several factories.
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Research your competitor's pricing structure to your product. If your market analysis reflects higher prices than your competitor's, you have not located the wholesale price. Incorporate costs for materials needed to make your product as well as quantities needed to be placed in order to arrive at a deep-discount rate.
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8
Compare your market data analysis. The lowest price will be your wholesale cost in order to manufacture or purchase your goods.
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