Why Is Valet Seller Better Than Wholesaling?
There are two main ways to sell your product – either as a wholesaler or as a retailer. Each has a unique set of pros and cons. When choosing how to distribute your product online, you must consider which model fits best with your branding strategy.
Sell to distributors and wholesalers who will resell to consumers shopping online
- Simple Pricing Structure
- Global Expansion Made Easy
- Don’t Need Seller Accounts
- No Control Over Listings & Content
- Not Able to Control the Customer Experience
- Not as Focused on Long Term Success
Sell directly to consumers shopping online
- Control Over Brand Identity
- Personal Connection to End Customer
- Less Middlemen = Increased Profit Margin
- Typically Paid Every 2 Weeks
- Customer Service Management (Unless you Utilize Valet Seller)
- Channel Management (Unless you Utilize Valet Seller)
Should I Open My Own Selling Accounts?
When making the expansion online, business owners must decide whether they will open their own seller accounts or utilize resellers & wholesalers to distribute their product. Customers can also partner with companies like Valet Seller or Whitebox to leverage their established seller accounts. To illustrate the pros and cons of creating your own seller accounts, I will compare Amazon and Walmart to a retail mall.
- The owner of the mall is Amazon or Walmart.
- The 3rd party sellers on Amazon or Walmart are the kiosks and small retail shops located in the mall.
- The largest and most established 3rd party sellers are the department stores within the mall.
In the analogy above, you will notice that larger and more established sellers are compared to the department stores in physical retail. There are a unique set of benefits for selling in the department stores versus selling in your own kiosk or shop within the mall.
- Department stores are more valued “tenants” to the mall. They receive better marketing opportunities and have signs pointing to their stores.
- They pull in more customers because of the vast selection of products.
- They can start selling new and innovative products instantly without needing to obtain new permits or opening a new kiosk. They simply add them to their existing shelf space.
- The department store manages customer service and logistics.
- Sometimes, you can sell in the department stores and in your own shop.
With that said, there may be times when a brand or seller should open their own store. For example, a high volume brand or seller that doesn’t want to pay a commission to the department store, and has the resources to hire a team to manage their own shop. This gives the seller more control over their shop.