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In this article I wanted to share with you my experience with a wholesale purchase of paracord.
Because I use up a lot of paracord and I also want to expand my business, I have decided to go with a wholesale purchase. Having talked with suppliers, delivery services, logistics companies and such, I got a bit of experience in handling these kinds of purchases.
So in this article I wanted to share this experience any maybe make your job a bit easier if you ever want to buy paracord wholesale.
What is wholesale?
Wholesale (bulk) purchases revolve around buying a large quantity of a product. Usually this is done directly from a manufacturer or a regional supplier (a company that imports and sells wholesale).
In contrast with buying retail, wholesale purchasing comes with a few advantages and disadvantages:
Advantages
The price you are getting is lower than buying from a retail store.
Disadvantages
You usually have to buy a large quantity (there is usually either a minimum price or a minimum quantity you need to buy). Because of this you have to buy a lot. In case of paracord, this would mean buying spools of paracord. Since you are buying spools your purchase is a lot more homogeneous, meaning you can’t usually buy a lot of different colors, because your budget is limited and you have to buy a large quantity of a product.
For example, in buying from a retailer you can afford to buy 10 ft of one color, 10 ft of another and so on. But when buying a spool, you are paying per spool, not per foot.
Is wholesale worth it?
Wholesale is worth it for two groups of people:
- retailers who sell their cord on with a profit
- people who use a lot of a product.
So basically, if you plan to either sell or use a large amount of cord, then it is worth it.
How worth it is it?
Well, it depends entirely on the price you get from the manufacturer, your shipping costs, taxes, customs and various fees. So it will depend entirely on your location and supplier (more on this later).
Was it worth it for me? Well yes. Using a rough estimate, I saved over 50% comparing to a standard retail price. But you need to know that you do go through a hassle of putting out a lot of funds and work in the process.
More on cost
There are basically three major factors you need to account for when buying wholesale:
- price of your goods. This is negotiated with your supplier
- transport cost
- taxes, import tariffs and various fees.
Let’s break these down a bit further!
Price of your goods
The price of wholesale goods is usually already lower than retail prices, because it does not include the various expenses such as transport and other fees. An additional discount can be gained when buying a larger quantity. For example, when buying 25 spools, the price per spool may be cheaper than when buying 20 spool. Basically, the more you buy, the more discount you get from your supplier.
Usually, when you contact a supplier, they will present to you a table that shows you the discount rates depending on the quantity you are buying.
When negotiating with a supplier it is also very important to ask about the minimum price and quantity. For example, with some, you need to buy at least 500$ worth of goods. Others may have a lower or higher minimum.
Other restrictions may also apply (in my case for example I had to order a minimum of two spools per color).
Always check if you can find a local distributor. These deal in wholesale in your area and can possibly offer you a good price, avoiding some of the transport expenses!
Price of transportation
This cost depends on where you are in relation to your supplier. If you are from the US, you can expect a low transport cost. If you need delivery to another continent, your transport cost will be higher. For those living in the US, utilizing a delilvery/courier service will work just fine.
Those that need overseas delivery though have two options: transportation via sea or air.
Delivering via ship
Ships are very economical. The cost is much lower than using an air delivery. Traditionally, ships allowed you to purchase (hire) a container, which is expensive to hire if you are not shipping an entire container.
Nowdays containers can be shared, which means you can hire a small part of it. This means the cost will be lower. There is still a minimum space that you have to rent, which is usually 1 ton or 1 cubic meter. WHOA! That is a lot right?! Well, it is still quite affordable. It is a good idea to check on this option even if you are not using up all the space.
The delivery timeframe for this type of transport is usually longer than air transport.
Delivery and logistics companies can organise this for you, which is what I recommend using.
Delivering via air
Air delivery does not mean that your goods will be parachuted into your back yard. Although with parachute cord, that would be even more thematical.
Basically this is delivery via plane. Again, courier services organise this for you.
This method is usually more expensive, but is faster. In my case for example, it was more economical to hire air delivery than via ship. Have I ordered more, using
Weigh both options and get the best price!
Haggling
It is sometimes a good idea to get a few offers and renegotiate prices for your delivery. The companies that deliver goods have quite a bit of space to maneuver when it comes to price of their services. Using offers from other companies as leverage is a good and easy technique.
Taxes, customs and other fees
When shipping outside of the US, you are importing goods. With this come some fees and taxes you can usually not avoid.
So what are these taxes and fees?
- a sales/consumption tax. When importing you have to pay a sales tax. This is one of the major expenses. If you have a tax number, this cost can mitigated though. In my case (EU) this tax can is called VAT and at the time of writing this article, it is 22% where I live.
- customs/tariffs- this is another kicker! Tariffs are set according to a reciprocal treaty between the US and the country you are importing to. In my case, importing to the EU, the tax/tariff on this type of rope was 8%.
- other fees include paying for the custom services and warehouse expenses, but you can reasonably expect these to be quite low.
Insurance?
When you organize transportation, a courier service will offer additional insurance. Although this is not a huge expense, you will be offered this service.
Naturally you don’t want your shippment lost or worse, but after talking to people I realized it is not worth it. Often the transport provider is obligated to do a basic insurance of the cargo and for my shipment this was about 20 USD per kilogram which would cover the entire value of the shipment (this is by the IATA-International Air Transport Association regulations).
Still, do your research!
In conclusion
So guys, I hope this article helps you save some funds, time or patience!
I’ll leave you with a little trick I have seen some people using when they can’t afford buying a large amount of cord by themselves.
A little trick- rocket science?
I have seen some people organizing a wholesale purchase as a group. So if you have fellow paracordists around your area that you can trust, you can go about it as a team!
But beware, it takes even more coordination that way and may complicate delivery and payment.
