Understanding Wholesale Pricing: What is Real Wholesale Like?

Here's a difference that costs retailers money every year: there's a real difference between the true wholesale price and the retail price with a "trade discount." This difference affects your profit margin on every order.

The true wholesale price is based on the supplier's cost of sourcing and producing the product, not the retail price minus a 40% fee. Suppliers who buy directly from manufacturers can pass on their cost savings to you, something middlemen reselling from other wholesalers cannot do.

Ask any supplier directly:

Do you buy directly from manufacturers, or do you resell from other wholesalers?

How are your pricing linked to current metal market prices?

What are your minimum order quantities by category?

For gold and silver, prices should fluctuate with the metal market. If a supplier quotes a fixed price significantly higher than the market price, they are not offering a wholesale price, but rather a markup on the spot price. For lab-grown diamonds, compare prices with IGI/GIA certified diamonds of equivalent quality from multiple suppliers. The difference between the actual wholesale price and the discounted retail price is usually between 20% and 30%, which determines the size of the profit margin.