10 Steps to Starting Your Own Buy and Sell Business

Published: September 26, 2019 | Updated: May 15, 2020 | Posted by: Venus Zoleta | Personal Finance


Buy and Sell Business Philippines | Moneymax

A buy and sell business is one of the easiest and cheapest small business ideas in the Philippines. You don’t need a business-related degree (though having one is an advantage) and large capital. Anyone—even college students, stay-at-home mothers, and inexperienced people—can start this kind of business for as low as PHP 10,000.

Buy and sell businesses can be profitable, too. Pinoys love good bargains in small quantities (also called tingi) but don’t have the time, energy, and patience for shopping at places like Divisoria. As a reseller, you buy cheap items in bulk and sell them in retail at higher prices. This allows you to offer low-priced products to budget-conscious consumers while still earning good profits.

Above all, the internet makes building and running a buy and sell business from home simpler nowadays.

Those are the whys of buying and selling for profit. Now, let’s tackle the hows of it.

Here are the crucial steps aspiring entrepreneurs should take to start a buy and sell business in the Philippines.

1. Research Your Market

Buy and Sell Business Philippines - Research Your Market

Many small business owners skip this critical step because of the wrong impression that market research is both expensive and unnecessary. The exact opposite is actually true.

Market research serves as the foundation of a business of any size. It enables entrepreneurs to identify and understand their target market and competitors, as well as validate their business idea. Ultimately, market research helps make sound decisions that lead to increased sales and business growth.

Because you’ll be starting small, you don’t need to hire a market research company to do the job for you. You can conduct DIY market research [1] by browsing online forums and threads related to your prospective product. Other research methods like email/personal interviews, informal surveys, and focus group discussions (FGDs) also work.

Through market research, you aim to answer these questions:

  • Who are the best people to offer products to?
  • Does your target market want what you’ll be selling?
  • What particular needs of your target customers are you trying to fulfill?
  • Who are your competitors? What’s unique about them? What will set you apart from the competition?
  • Is the market already saturated? Are there too many stores nearby that sell the same products as the ones you plan to offer?

2. Write a Business Plan

Buy and Sell Business Philippines - Write a Business Plan

After researching your market, the next logical step is to draft a business plan. This document covers all the details of starting and running a buy and sell business. Yes, you need to put those things in writing because it’s important to be organized as an entrepreneur. Also, your business plan could come in handy when you need to apply for a business loan.

3. Look For Sources of Capital

How will you fund the initial expenses for your buy and sell business? You may have already saved up for it. If it will take time to save enough money for your new enterprise, or you don’t want to touch your savings, consider getting a low-interest personal loan for business purposes from a bank. Borrowing money at a low interest rate is a good idea because the loan won’t eat away your earnings.

Read more: Business Loan for Startups in the Philippines

Citibank Personal Loan

4. Choose Products to Sell

In a buy and sell business, you can practically sell anything (except for the common prohibited items like perishable food products, weapons, etc.). Of course, it makes sense to consider selling the type of products you’re interested in or passionate about—it’s what will keep you going when things get tough.

But if you’re after maximizing profits, then choose the top-selling products or those with high demand. You may use online tools like the Google Keyword Planner to find the most searched brands and product categories related to the product/s you want to sell.

Profitable Buy and Sell Business Ideas in the Philippines

Especially if you’ll take your buy and sell business online, consider selling any of the following top-selling items in the Philippines:

  • Shoes
  • Bags
  • Toys
  • Health supplements and products
  • School and office supplies
  • Motorcycles and accessories
  • Electronics and gadgets – cellphones and accessories, cameras, smartwatches, headphones, etc.
  • Beauty products – cosmetics, face masks, skincare products, etc.
  • RTW clothes – t-shirts, dresses, sportswear, swimwear, formal wear, etc.
  • Baby care products – Milk powder, diapers, bath products, etc.

5. Find Wholesale Suppliers

Buy and Sell Business Philippines - Find Wholesale Suppliers

Once you’ve decided on the products for your buy and sell business, look for wholesale suppliers of the items you want to sell.

Divisoria, Baclaran Market, and Greenhills are the go-to sources of products for buy and sell entrepreneurs in the Philippines, especially for clothes, bags, shoes, and toys. For very cheap wholesale RTW garments, head over to Taytay Tiangge in Taytay, Rizal.

There are many other wholesale stores in the Philippines that specialize in different types of products. Online wholesale shops make procuring products a lot more convenient than going to brick-and-mortar wholesalers, so you may also want to check them out.

If you have a particular brand in mind, you may reach out to the company to ask if it has a reseller program or if it accepts dealers or distributors of its products.

When searching for the perfect supplier, ask for quotes and compare prices. Make sure that the items are legitimate and of good quality—you don’t want to sell fake and inferior-quality products.

Read more:  Tiangge Shopping Destinations for Great Bargain Finds

6. Set Up Your Store

Buy and Sell Business Philippines - Set Up Your Store

If you want to have a physical store, find a high-traffic location where many potential customers can see your shop and products. Depending on your budget, you can rent a space in a mall, within your neighborhood, near a school, or any place where your target customers pass by.

Renting space and setting up a physical shop can be very expensive. To save on costs, open an online store instead. You can set up your buy and sell business on social media (particularly Facebook and Instagram) or online shopping marketplaces such as Lazada, Shopee, and OLX. When your business scales up in the future, you may also build your own website (through e-commerce platforms like Shopify and Shopline) where your customers can buy your products.

7. Open Accounts for Receiving Payments

Although cash on delivery is still the preferred payment method among Pinoy shoppers, it’s also good to provide alternatives to customers who want the convenience of paying without cash.

Open different savings accounts (ideally with major banks like BDO, BPI, and Metrobank), so paying customers can make an over-the-counter deposit at the nearest branch, or simply transfer funds to you via online or mobile banking.

The number of mobile wallet users in the Philippines is growing, so it’s also great to have them as payment options for your customers. For this purpose, open an account with PayPal, GCash, PayMaya, and/or Coins.ph.

8. Get a Shipping Service Provider

Buy and Sell Business Philippines - Get a Shipping Service Provider

If you’re starting an online buy and sell business, buying a dedicated vehicle for deliveries can eat away your capital. A cost-effective option is to avail of the services of a logistics provider that will pick up the orders from your location and deliver them to your customers.

Online sellers who are on Lazada or Shopee need not worry about shipping their products because the e-commerce websites handle it for them.

9. Register Your Business and Secure Permits

Some small buy and sell business owners operate without business registration papers, and that could be fine if the online marketplace they’re selling on allows it. For instance, Lazada and Shopee don’t require proof of business registration from individual online retailers of unbranded products.

However, if you’ll be selling as an official or authorized dealer of a brand and want to gain legal status for your business, then get the necessary registration documents. Apply for a business registration certificate at the Department of Trade and Industry (DTI) and mayor’s permit at your city or municipal hall. Also, get a BIR Certificate of Registration and file your income tax return at the Bureau of Internal Revenue.

If your store will be located in your neighborhood, check with your homeowner’s association if there’s any required permit you need to secure before you can start your buy and sell business.

Will you hire an assistant or customer support staff? You’re required by law to register yourself as an employer and your new hires to the BIR, SSS, PhilHealth, and Pag-IBIG.

Read more: Employee Registration Philippines: A Guide for Employers

10. Promote Your Buy and Sell Business

Marketing is an important aspect of your business no matter how small it is. If you’ll open a physical shop, you can distribute flyers and post banners nearby.

If you’ll be having an online store, take advantage of social media as a marketing tool [2]. Create your own business profiles on Facebook, Instagram, and Twitter. Consider having paid or sponsored posts about your new business at a minimal fee to get it known to your target customers. The good thing about promoting a business through sponsored posts is that you can choose the location, age, and interests of people you want to target.

Final Thoughts

Starting a buy and sell business has never been easier, thanks to the internet. That’s why it’s a popular choice among first-time entrepreneurs who want to earn extra income in their free time.

Planning to put up your own venture? Good luck and may your small business be successful!

Apply for a personal loan today!

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