Video games are big sell outs. They have high capital turns as an investment since every kid or parent would likely hit the shelves the moment a new release is on the market.So if you’re planning to be one of the video games wholesalers, you should start doing your assignment. Selling this product is different from marketing clothing or electronic goods. You have to know the ropes of the market.
Having a background with the video games you’re selling to retailers will help in your marketing process. It’s easier to convince a video game store to purchase your goods if you know the tricks of the trade.
Keeping up with the new releases and securing an inventory is the name of the game here. Many wholesalers would surely go to great lengths just to acquire an inventory especially if the items are collectibles. You should also do the same as it entails good profit and this is why I came up with this post. Here, I’ll give you some tips for starters on how to jumpstart your gaming business.
Acquire a reseller permit
Before you splurge on buying inventories, it’s important that your business is legitimate. Acquire the necessary permits to be a reseller that may include but not limited to business permit, license, reseller permit, and tax ID. Some distributors would only deal with wholesalers that have an updated tax ID so it’s better to secure one before starting out. Be mindful of your state laws about wholesaling to avoid any legal conflicts along the way.
Shell out a capital
The next step of hopping into the video games wholesalers pool is buying inventories. Some video games would cost about $25 to $50 in wholesale price, and since you’ll need to buy in bulk, you would need to shell out a bigger capital. The amount of money depends on how large your inventory would be. Just keep in mind that this is a gamble as video games prices drop faster than ever. You could lose $10 in just a week if you buy video games that may go stale in the market too fast.
You should also factor in operational costs like delivery, storage area, and personnel salary.
Have a store
Although you’re not a retailer, having a warehouse or showroom would add to your marketing strategy. You can let potential retailers scout for their video games as well as place orders personally. Choosing a place near residential area would help too as retailers would have easy access to your products than having it shipped from abroad or another state. This is also easier for a distributor to find you and deliver the goods you ordered.
Contact famous brands
In this era where video games wholesalers are always giving each other a run for their money, you should have the leverage too. Popular brands like Nintendo, Wii, Sony, and PS should always be in your inventory. Video games like Yakuza, FIFA, Minecraft, God of War, and more are also best sellers nowadays. Famous brands might cost more but it’s easier to sell and you have a higher chance of getting more turns from your capital. Japanese video games are big hits too, which you might also consider buying.
Always be hooked on the latest releases
The video games industry is continuously reeling with new versions and releases. As a wholesaler, it’s your job to be on the hook of the new products that the consumers would likely look for. Purchasing bulk orders of old games would stuck your capital in the waiting line as new games flood the market. The likes of WholesGame have a reliable reference on the date releases of the new games. If you have a different distributor, you should ask in advance that you be reserved for a certain amount of inventory. That is if there’s evident demand for such products from your retailers.
Offer your goods at the right price
Distributor price is different from wholesale and retail prices. If you get a Yakuza game from your distributor for $30, you can sell it to your retailer for $40 to $42. They will sell this to the consumers for as much as $70. This is the usual profit margin for video games. Some video games wholesalers earn more when there are high demands and low supply. However, avoid overcharging your retailers, as you can’t stand losing a buyer. The rule of thumb here is earning a decent profit and making your retailers happy at the same time.
Get yourself a consistent distributor
Without a reliable distributor, your wholesaling business would be compromised. You have to acquire an inventory of products continuously even before you run out of stock. If not, you will be exposed to loss of potential profit and your retailers would be looking for another supplier. You can have more than two suppliers of various different games as the other might not be selling a specific product. A tie-up like this would ensure that you’re always topped up with the latest releases.
Know the trend
Like what I said earlier, an outdated video game is less likely to yield profit than the latest one. Video games have fluctuating prices and the selling value could be slashed dramatically by $10 to $15 in just a week. Always be in the know of the trends so you won’t be left out when other wholesalers start acquiring inventories. The competition here is tight and the least that you can do is to get your hand into the latest inventories before others have the chance to do so.
Veteran video games wholesalers would surely agree with these points I stated here. Starting your own wholesaling business would entail some researching and network building. Aside from setting up your place in the supply chain, you should also have a list of retailers that will purchase your products. I know you have something to share, feel free to comment below!