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A computer parts reseller is the step in-between distributors and end users. A reseller purchases product from a wholesaler or manufacturer, adds a profit to that product and then sells it to the end user. In most cases a computer parts reseller will buy from a distributor or wholesaler, as manufacturers only deal with large-quantity customers directly. When establishing your computer parts reseller business, you will also need to consider offering services to add to your business model and increase your profit.
Establish your business by registering with the local government business office and getting a DBA ("doing business as") certificate. Computer distributors and wholesalers will not sell you product at resale price unless you have your business certificate. In some states you may also need to get a sales tax license to sell retail products. Contact your state department of taxation to find out if you need a sales tax license.
Contact the manufacturers you would like to represent and find out which distributors they go through. If you can, convince manufacturers to give you a specific contact name at the distributor.
Create a website you can use to sell products to your customers. Some distributors will want to see how you intend to market products to end users, and a website can be a very powerful presentation tool.
Apply as a reseller to the distributors recommended by the manufacturers. Some distributors may not do business with you if you are a brand-new reseller; they will want to see a history of sales first. Keep these distributors in your files and re-apply to them when your business has reached their sales level requirements.
Research other potential distributors on the Internet. As a new reseller with no history of sales, you may have to start doing business with a second-or third-tier distributor until you can establish yourself. The challenge is that pricing from second- and third-tier distributors is always higher than primary distributors, so you will be competing with other resellers that get lower pricing that you do. This will affect your initial start-up margin.
Boost your profit margins by offering services such as warranties through manufacturers. Some manufacturers offer extended warranties directly to any reseller through their website; you will be offered a lower price than retail for the warranty services, and then you can sell the warranties at retail price. Another way to make profit when you are starting as a computer reseller is to find customers looking for high-profit items such as cables or memory.
Constantly be looking for additional suppliers for your products. You may find smaller wholesalers that can offer you new product at prices lower than the distributors recommended by the manufacturers. Get any customer service information (product warranty and exchange services, etc.) in writing from these lower-priced wholesalers before you start to do business with them.
Be wary of low-priced wholesalers selling what is known as OEM product. For example, if a large computer manufacturer has extra unused copies of Windows, then the manufacturer may sell those copies at a very low cost to low-priced wholesalers. The wholesalers then offer the product to you at a cost lower than other distributors. The problem is that there is no support for the OEM product, and if any of it is defective, there are no returns. Ask upfront if you are dealing with new retail product or OEM product before you buy.
George N. Root III began writing professionally in 1985. His publishing credits include a weekly column in the "Lockport Union Sun and Journal" along with the "Spectrum," the "Niagara Falls Gazette," "Tonawanda News," "Watertown Daily News" and the "Buffalo News." Root has a Bachelor of Arts in English from the State University of New York, Buffalo.
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