Global smartphone sales have numbered over 1 billion each year since 2014, and there is no end to their popularity.
No matter where you are in the world, all manner of smartphones are a common sight. With such a high demand that’s steadily growing, your inner entrepreneur may be considering dipping your toes into the cell phone industry.
This is a fantastic idea because there is a relatively low barrier to entry.
If you are interested in starting a wholesale cell phone business, you’re in the right place. This comprehensive guide contains everything you need to turn your interest into a successful profit-churning machine.
Excited? Keep reading!
What Is the Cell Phone Wholesale Dealer Business?
A wholesale cell phone dealer buys cell phones at wholesale prices and quantities and sells them to customers at a markup. These phones can be new or refurbished, depending on the market you are targeting.
Your business can involve equipment sale (cell phones and accessories) or sale of cell phone data and service, or both.
Either way, you’re in for a ride full of fun challenges and potentially huge profits with a cell phone wholesale business.
Steps to Become a Cell Phone Wholesale Dealer
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Research and Study
It’s essential to do your due diligence before you dive into the nitty-gritty of your cell phone wholesale dealership business.
This involves studying the industry and requirements to run a wholesale business in your area. You should also determine if the opportunity will be lucrative for you in the long run.
You must study the market and key players that perform well, whether they sell new or refurbished. It’s important to understand the ins and outs of the industry before you jump in with your hard-earned capital.
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Register Your Business
Whether you choose to distribute cell phones or data services, you must first register your business with state officials. Then, obtain a local business license to run your dealership. All states and counties mandate certain requirements for the formation of a business.
You must also register with the tax officials in your state. This will secure a tax ID, which you will need for several purposes later on.
If you’re building your business online, you should secure a domain from which you will operate.
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Contact Manufacturers, Service Providers, or Suppliers
The next step is finding wholesale suppliers in your area. We suggest perusing public directories of your local wholesalers. Your Local Chamber of Commerce is an excellent place to start for local suppliers. You can also try trade shows.
Those looking for suppliers online can use online directories, Google My Business listings, or even social media pages.
Another option is to get in touch with manufacturers directly. However, these transactions often require very large orders. If your unit requirement is smaller, you will likely be directed to an official distributor.
When contacting manufacturers, make sure to fulfill all their requirements regarding territory, competition, minimum order quantity, and more.
When dealing with service providers, check whether their service is compatible with the devices you’ll be selling, along with the following features:
- Commission structures
- Pay schedules
- Monthly fees incurred
- Overall startup costs
- Coverage provided
Alternatively, you may check out online marketplaces that specialize in refurbished electronics wholesale. These are a good option for those looking to make higher profits with very low investments, with no need to sign a contract.
Such suppliers offer an extensive catalog of new products, refurbished, tested, and sold at wholesale prices. You can get fantastic deals even at low minimum order quantities.
Once you have all the information you need, review offers carefully and pick those that will make you the most profits.
Consider the following features before deciding:
- Company reputation
- Customer service and sales support
- Volume discounts
- Shipping costs
- And any other features that are indispensable to your business structure and operations.
Avoid suppliers that do not have a physical address or a robust returns policy.
If you plan on starting a dropshipping business, we suggest you thoroughly check all your potential suppliers. While a low-cost and low-liability selling structure, dropshipping can be a disaster when your supplier isn’t up to par. Take your time and check reviews and client testimonials as you narrow down your list.
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Sign a Dealership Contract
The next step is to sign a dealership contract with your choice of manufacturer or service provider. Again, due diligence is critical here—make sure to read the agreement thoroughly before signing it. Closely consider your obligations and what you can expect from your supplier.
If you aren’t sure the contract is suitable for your business, partner with a trusted business lawyer to review it for you.
Once you sign the contract, you’ll soon receive your first inventory package.
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Build Your Store
With the way technology is developing, you likely want to ditch the physical store and run your business online. This is a brilliant idea that we fully support for its low investment requirements.
When it’s time to build a website for your cell phone business, you have two options. You can have your supplier make your site for you or build it yourself based on their requisites.
And if you still want to build a physical store, consider the following factors:
- Traffic and footfall in the area
- Display features and space
- Parking features
- Convenient location
- And more.
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Market Your Store
The next step involves getting the word out about your new business venture.
Whether you choose a brick-and-mortar store or an e-commerce platform, you must invest significant time and energy in efficient marketing techniques.
Our advice is to take a lesson from your competitors and follow or improve their marketing practices.
A critical element that will affect your advertising efforts is the contract you’ve signed. Most manufacturers and service providers add clauses to limit and guide the use of their company and brand name. Keep these guidelines in mind when building your marketing strategy.
Final Thoughts
This comprehensive guide to becoming a cell phone wholesale dealer from scratch has outlined everything you need to find success in the industry.
We hope this article will help you build on your love of technology and follow its growth as you continue to make profits.
Best of luck!
