Resale is the sale of items that were previously purchased. In this case, the seller buys products from other businesses and sells them at a higher price. The company is not involved in the production of goods.
This definition includes both retail and wholesale businesses. In contrast to retail, wholesalers buy goods and sell them to the next intermediary, both wholesalers or retailers. Meanwhile, retailers purchase and then sell it to end consumers.
Maximize profit from the resale
Because it is involved in buying and selling goods, profits come from the difference between the purchase price and the selling price. The higher the difference between the two, the higher the profit gained.
There are several ways to maximize profits in this business, including:
- Buy as cheap as possible. Buying in large quantities is one way, allowing companies to get a discounted price. Also, companies can buy directly from producers, instead of other intermediaries.
- Good storage technique. It ensures the product remains in the initial condition when sold. The next way is to find potential buyers as quickly as possible, thus keeping inventory costs low.
- Selling at the highest possible price markup. Businesses must find profitable customers, for example, using segmentation and price discrimination techniques. It may be a difficult task because customers often price sensitive.