In a somewhat surprising move, the wholesale marketplace Tundra suddenly announced that it is shutting down.
The announcement was seemingly made at the same time that they announced that they are suing their competitor Faire for anti-competitive practices. They said of the suit in their announcement:
Our Tundra marketplace simply cannot remain a viable concern in the face of the anticompetitive conduct, unfair policies, and the punitive enforcement of exclusive arrangements by our direct competitor, Faire Wholesale, Inc. We have sued Faire under the United States antitrust laws seeking remedies that would end Faire’s misconduct, and we hope to be able to return to operating upon a successful resolution of our case. A copy of our federal Complaint can be accessed here.
By the time you read this, they will no longer be taking orders, as they stopped doing so on July 17th. It’s a real shame to lose a wholesale marketplace like Tundra because it offered a lot of great brands.
Some of the things that Tundra mentioned about Faire were news to me, I didn’t know up until that point that if you sold via Faire that you weren’t allowed to have dealings outside of Faire, on other marketplaces or direct.
As someone who has transacted via Faire, I have only positive things to say about the experience, but I can see how merchants would feel limited by this constraint and also by having to list their entire catalogue on Faire. I have heard criticisms of the commission structure used by Faire, but the 25% is actually fairly reasonable when compared to other marketplaces such as Etsy, who take a similar cut.
So, where can we source wholesale products easily now?
I looked into joining Handshake, but despite being run by Shopify, it is for US-based merchants only. This unfortunately means that as a Canadian, I cannot even sign up. I found that surprising, considering that Shopify is a Canadian-based company. So, this is not an option for me.
There are some wholesale marketplaces that are for large merchants, but the minimums are tricky for smaller merchants and so I’ll skip those.
Some people might think that dropshipping is an answer here, and indeed it could be, but be careful. Just this morning, I was looking at one of the dropship supplier’s market and I saw a product I wanted, but it was being offered at $30+, a quick bit of Googling later and my hunch was correct that the retail market price for this item was a lot lower, around $15, in fact! It made me wonder if the supplier was sourcing from Etsy and selling on this other marketplace at a much higher cost. There’s almost no way y0u’ll be able to sell a product worth $15 retail with a markup when you buy it at $30. Always research your market, folks.
As much as I feel that certain criticisms of Faire do merit some scrutiny for fairness (I am not a lawyer, so I actually don’t know anything about that), I still think they’re the best in class for retailers looking to connect with suppliers on a wholesale marketplace.
How do I order directly from a brand?
Back when I started out, I bought directly from the brand through wholesale, and a lot of companies still go this route as they usually have lower prices but a lot of the overheads are things you need to take care of yourself. If want to kick it old school without a wholesale marketplace, these are the basic steps:
- Search for a brand or product that you want to offer in your store
- Research the brand and find out if they offer wholesale
- Connect with the wholesale contact and find out what their order and reorder minimums are
- Verify your business with them and place an order
- Take care of the import duties and taxes once your order arrives.