Finding The Best Wholesale Clothing for Arbitrage – Step-by-Step Guide

Clothing can be one of the toughest niches to get into when selling online, especially when sourcing from a third-party. If that third-party is overseas, well that’s even more trouble. When searching for the best wholesale clothing for arbitrage purposes online, there’s a lot to look out for from quality and pricing to sizing, delivery terms, and contracts.

In this post, we first try to help you identify which sourcing route is best for your own unique situation. Some of the most popular ways to go are retail arbitrage, wholesale and dropshipping. Each of course, with their own unique pros and cons. We’ll cover the differences, then we’ll go more in-depth into wholesaling.

Wholesale Sourcing vs. Retail Arbitrage vs. Dropshipping

Okay, so time to cover some pros and cons for each model, starting with retail arbitrage. If you’re reading this, you’re probably most interested in wholesale. It’s still helpful to understand the typical alternatives and how they compare to your choice, though.

Retail Arbitrage

So first: retail arbitrage. It’s the most basic form that a lot of people start out doing, it’s actually more simple than it sounds. The way it typically works is that you look for items you can buy at bargain prices whether in retail store clearances, flea markets, garage sales, Craigslist, or basically anywhere else you can think of.

You then buy these discounted items in bulk and resell them somewhere else at close to retail pricing. Pretty simple. The problem with this is that it’s hectic and is hardly scalable, but it can work well if you’re just starting out and looking to make some initial dough to expand your “operation”.

Dropshipping

Dropshipping is a step up in the game. It’s a very interesting model and I know people doing 7 figures just sticking to it. Here’s the gist of it: you agree with a supplier to dropship your items. What this means is: You list these items on your website. When someone places an order, you simply forward that order to your supplier.

Your supplier then processes that order and ships it directly to your customer. No inventory, no fulfillment or warehousing to take care of and you don’t have to even physically handle the product, ever. You’re just a middleman that basically refers orders to your supplier in the backend, and make a nice margin doing it.

The biggest disadvantage of this approach is the lack of control. Your supplier controls quality, shipping time, product specs and practically everything product-related. You just handle marketing and customer support, and it’s your “name” on the line. Anything goes wrong, the customer holds you accountable for it, no one else.

Wholesale

Finally, the wholesale model. Wholesale is mostly pretty self-explanatory. You buy items in bulk at a discount, you store them and resell them individually to end customers at a profit.

Buying items in bulk and reselling them is no walk in the park, though. First off, there’s the high-risk associated with buying an item in bulk and not being able to gain any traction in selling it, ending up with dead stock.

There are also high costs and a lot of logistics that need figuring out. Storing, packing and shipping, stock control…etc are just some of the nuances involved. Thankfully, this model has gotten much easier to work with over the years, thanks to programs such as Amazon’s FBA.

Amazon FBA, or Fulfilment By Amazon, makes things a lot easier by having Amazon do all the legwork for you. You work out a deal with your supplier and then have them (or you) send the purchased stock in bulk to Amazon’s warehouses. That’s all there is to it.

Of course, you also work on your product listing, customer support…etc but everything related to order fulfillment is handled by Amazon. That’s a big perk because now, there’s little to worry except the risk of purchasing something in bulk that doesn’t sell. Other than that, Amazon’s got your back!

Where to Find Clothing Wholesale Suppliers?

Now that you understand the differences, it’s time to actually get your hands dirty and start searching for your supplier, but first, there is one important decision you need to make.

Source Locally or Internationally?

Both approaches have their pros and cons, obviously. If you choose to source locally, and by locally I’m mainly referring to North America, you basically reap the benefits of sourcing from a first-world/developed country.

This means better financial and legal protection so it’s harder for suppliers to “scam” you. You also benefit from faster shipping times which is not generally a problem if you’re buying wholesale but could be a huge issue if you’re dropshipping.

The expected manufacturing quality would typically be higher as well as labor standards. Communication is also generally a lot smoother because there’s no language barrier.

There are a lot of advantages, and only a couple of disadvantages to sourcing locally. However, the disadvantages’ strength lie in their individual weight, and not their numbers.

First off, you can almost always save big time when ordering overseas. Countries like India, China, Bangladesh and others have much, much lower labor costs than the US and that passes big savings that reflect in the end product price.

The other issue is, there are just so many items that are not manufactured in North America anymore. How many times did you buy something from one of your local retail stores and discovered later that it’s “Made in China”? I bet many times.

These are the disadvantages to sourcing locally and those are the same as the advantages of sourcing internationally. Sourcing internationally definitely has its issues too, though, as it’s much harder to find quality suppliers abroad and it’s easier for a supplier to disappear on you overnight.

It’s also harder to physically visit the manufacturer to verify their legitimacy, inspect samples, or close deals on site. Overseas shipping and customs could also be a big issue depending on the type and quantity of your order.

Now that you know the difference, you can decide on which route you’d like to take. Let’s get into the nitty gritty of finding suppliers!

Reverse Engineer the Competition

When you find a competitor selling a product you’re interested in sourcing, simply Google the brand and contact them to ask about wholesale deals. Smaller brands/manufacturers will probably sell directly to you.

Bigger ones will most likely direct you to a distributor. For instance, popular clothing brands like Bella, Canvas, Anvil, and Gildan can easily be reached for wholesale deals. Most of them have distributor information directly on their website so you don’t even need to get in touch with them.

Search for Popular Brand Suppliers

You’d be surprised how effective this tip alone could be and how stupidly simple it is. All you have to do is make a list of your favorite clothing brands. You then Google “your brand supplier”, “your brand manufacturer”, “your brand factory”…etc. Let me give you one interesting and practical example.

I googled “h&m suppliers” and I discovered that H&M keeps a huge list of suppliers and manufacturers on their website. Check it out yourself. I noticed they work with manufacturing facilities in dozens of different countries, the majority of which have very low labor costs, allowing them to save big on manufacturing.

The list is virtually endless, there are dozens and dozens of entries for every single country. Unsurprisingly, the US seems to be one of the places where they work with a very limited number of factories, which would make sense because of the costs involved.

Like that list wasn’t enough to get my feet wet, I went ahead and started googling the countries that host the biggest number of manufactures H&M work with. So for instance, I started googling “clothing wholesale bangladesh”, “clothing wholesale india” and used combinations of the words “wholesale”, “supplier”, “manufacturer”, “factory”…etc.

This rapid expansion of the search lead to more and more results, I could probably continue sifting through them for weeks. My approach would generally be to contact as many of them as possible with concise questions and wait to hear back from them.

Once I do, I’d see who was the most responsive, most accommodating and of course had what I wanted at a good price, reasonable minimum order quantities…etc. More on that in the “Communicating with Potential Suppliers” section below.

Google, Relentlessly

This is basically similar to the point above, but I just had to reiterate how important using Google is. The above was one specific example, but there’s a lot more you can do.

You can start a search from scratch going for something broad like “clothing supplier/factory/wholesale” and then digging deeper, similar to our H&M example above.

Supplier Directories / Search Engines

There are a number of free and paid wholesale supplier directories you can browse. Here are some free ones:

For the paid ones, a lot of people wonder if they’re worth the money. In all honesty, paid directories can save you a lot of time in many cases. However, they’re by no means necessary. By doing some digging on your own using the methods above, you’d probably be able to get to most of the suppliers that the paid directories have to offer you.

That said, the paid directories are usually more convenient in the sense that they’ve already vetted suppliers (at least to some extent) for you. They may also provide some advanced search, filtering and sorting options that take away some of the annoying leg work. But, again, they are by no means a necessity to your success in finding a good supplier. Let’s explore some of the popular ones:

  • Doba: Doba was established in 2002 and costs $60 per month, a significantly higher price point than its counterparts. However, it does offer more than just a directory of suppliers as it helps you directly place orders with dropshippers there, and it also integrates with eBay.
  • SaleHoo: For $67 a year, you get access to over 8,000 suppliers with a 60 day money-back guarantee. They started in 2005 and a lot of Amazon and eBay sellers seem to be familiar with them.
  • Worldwide Brands: Founded in 1999 and currently feature thousands of wholesale suppliers and millions of products. They charge $300 for a lifetime membership. These guys are one of the oldest directories around. They’re strict with who they let in and most suppliers listed are reliable ones.

What to Look for in a Clothing Wholesale Supplier?

If you attempted to try even a single method from those listed above to find suppliers, you’ve likely ended up with quite a list of potentials at your fingertips right now. To avoid analysis paralysis, let’s go through some of the things you’d want to look out for when choosing the perfect supplier.

This should help you filter out the majority of your list and allow you to zero in on those likely to be the best ones.

So first off, it’s important to understand that traditional wholesale suppliers are often difficult to find. These guys usually don’t run ads, don’t know SEO and have mediocre marketing skills at best. With that in mind, expect to encounter a lot of “fake wholesalers” when you go broad with your search.

So for instance, when you Google “clothing wholesale”, you’re likely to encounter many companies that claim to sell at “wholesale prices” but do not. This is why I stressed above the importance of digging deep.

This digging doesn’t only set you apart from competitors who spend 5 seconds looking for suppliers and end up paying inflated prices, but it also allows you to get “closer to the source” because generally, manufactures or large scale wholesalers only come up with the extensive, “deep” searches.

Some of the other things you should consider:

  • Niche/Industry Expertise: Professional suppliers usually specialize in one or a few niches. They know their industry inside out and can answer all your questions easily.
  • Strong Support: Your supplier should be attentive and should have dedicated support reps to answer your questions and solve problems.
    And by support reps I mean people who can actually help you, not those respond back in 5 minutes with copy/paste templates and then boast about their awesome support.
  • Efficiency: Some suppliers would mess up every other order whether quantity or quality wise, sizing, packing or otherwise. Others would have processes and systems in place that minimize errors and increases efficiency. This is very hard to know for sure unless you try working with the supplier first, or ask someone who has.
  • Technology: Although not essential, working with a supplier that invests in technology to make your life easier (easy online ordering, tracking…etc) is a big plus.

Communicating with Potential Suppliers

Suppliers typically receive a bazillion “quote requests” every day. The majority of those “quote requests” will be from people who will never follow up or aren’t even remotely serious about doing business with them. That’s why it’s not common for suppliers to ignore a lot of the emails they get daily.

To avoid falling into this trap, try to be very concise and direct with your emails, especially during initial communication. Ask only the most crucial questions at first, get them to respond then start a conversation and build the relationship from there.

So what to include in that first email?

Indicate what kind of specific product or product line you’re interested in ordering. Ask about their MOQ (Minimum Order Quantity), their price per unit at the minimum order, their price per unit at higher quantities (3-5x minimum order), their sample request terms and their payment terms.

That’s it! Once they respond you can then quickly determine whether you’d want to move forward and order a sample to get the ball rolling.

The Verdict

Finding reliable suppliers is far from a simple process most of the time. Although you can find a big list of potentials relatively quickly, the list gets filtered just as quick. Many won’t reply at all, some will have ridiculous requirements, others won’t send samples or their samples will suck…etc.

The good news, however, is that the process is worth it. Because once you find that one (or multiple) suppliers that you can work with and see how much headache you’ve actually avoided when things go smooth, you’ll be glad you went through this daunting process and didn’t settle for the first Google search result that came up 5 seconds after your initial broad.

Leave a Reply

Your email address will not be published.

*