Bulk Buying

Things to know before bulk buying to save on unit pricing.

Oct 5, 2021

As a small-business owner, you are likely to be on a continual watch for ways to curtail mount up costs for your business. One probable strategy is to buy in bulk or bulk purchases, but like in every step of your business, there are certain aspects you should be aware of before making a bulk purchase. Here are some of the aspects I think you should be well informed about.

Began with Figuring out your space: the idea of saving money might sound tempting to any business owner, but consider the extent of space you have at your business before you make the same mistake most of the beginner bulk buyer makes, purchasing more than you can keep in your business. However, if you have enough space bulk buying does not post any thread. Be sure of how much to buy while bulk buying, if after the purchase there is a need for extra space that will just add up to your expenses.

Take a fresh look at your buying habits: if you buy products that have guaranteed buyers, a bulk purchase can be a better option. Before going for bulk purchase try and evaluate what products to buy, go through your sales records and trends before making a bulk order. Otherwise, you may end up like others who did not conduct proper research before making unnecessary purchases, and getting rid of the excessive purchase may result in unavoidable losses in the form of discounts and rebates. Be ready with the upfront fees: bulk purchase could lead to upfront fees to access the items at a less or wholesale price. For illustration, warehouse clubs require businesses to purchase a membership before buying through their stores plus if you plan to sell any items, they would require you to obtain a resale license. And if you require a state or county permit you need to pay for licensing fees.

Don’t be scared of the long way: all top businesses admit that upfront costs are ‘not pleasant. But if not given proper attention to they can deter you from your goal. You can eventually achieve an attractive economic scale if you take a long way. By using the capital you saved from bulk buying, you can invest it in attracting more customers which in turn will increase your sales.

Look out for perishables: the type of products you buy may affect whether you should invest in bulk buying or not. Perishable goods such as fruits, veggies, and dairy products must be used fast to avoid wastage. So, if you are considering products to stockpile, you may go for non-perishables such as nuts, pasta, grains, spices, and canned goods. Otherwise, wooden products are smart goods to bulk buy. Just remember the limitations while bulk purchase.