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Reselling business is one of the easiest and fastest ways to start a business.

Why is that so?

When you sell an item – it can be a pre-owned product such as a pair of jeans, at a price higher than your purchase price, that is considered reselling. This means that you do not need to source for items to resell if you think your existing inventory has the potential to make a profit, you can be a reseller.

So What is a Reselling Business?

In simple terms, a reselling business involves the process of procuring products from suppliers, wholesalers or manufacturers and reselling it to your customers at a margin.

The good part is that you can skip the design, building prototypes or investing millions into patents. All you have to do is to find a product that you think has the potential to make a profit.

In more “technical” terms, this is known as “retail arbitrage”.

One of the most popular forms of reselling on the Internet today is dropshipping. This online business model is ideal because you do not need to hold inventory, or require the need to manage logistics and delivery.

But of course, there are many different ways of running a dropshipping business, as some business owners prefer to ship the items to their location for inspection before sending it out to their customers.

So if you are excited to find out more, carry on this article as we discuss everything you need to know about starting an online reselling business in the Philippines.

Is the Reselling Business Profitable in the Philippines?

The online reselling business in the Philippines can be lucrative and has been a popular business model in recent years because Filipinos are spending more time on the internet. The International Trade Administration found that Filipinos are actively using social media platforms and spending at least 10 hours per day, across seven days a week.

This is further justified from the fact that in 2020 alone, the Philippines Central Bank recorded 20.1% digital payments from financial transactions amounting to $46.8 billion, a 61% increase from the year before.

And in 2021, ecommerce sales in the Philippines reached $17 billion, and this is mainly attributed to 73 million online active users. Despite that, it is projected to have a 17% growth through 2025.

Hence, it is no surprise why many Filipino business owners, both existing and new, have decided to go digital. And starting an online reselling business can be a good idea, considering that it’s relatively easy to set up and does not require a large capital investment.

Why is the Online Reseller Business Popular in the Philippines?

1. Simplicity 

There are several reasons why the online reselling business has become so popular in the Philippines. But the main reason is it’s simple to operate and manage. Unlike most traditional business models, you do not require equipment or a large warehouse space to run. All you need is a smart device, either a mobile phone or computer with internet access and you are ready to operate your online reselling business.

By going online, you save on rental and manpower costs. Thus, the barrier to entry is much easier since the cost of running online reselling business becomes significantly lower, which doesn’t require you to pitch for a bank loan.

2. Flexibility

Another reason why this business model is popular amongst Filipinos is because of its flexibility. The online reselling business doesn’t require you to start it at a large scale immediately, while you can also run this business on the side and still have a main job.

So run this online business at your own comfortable pace as there are no hard rules to follow.

How to Start a Reselling Business in the Philippines?

While starting an online reselling business can be fairly easy and straightforward. But it is good to know some important tips to ensure your online business can run smoothly. Here are some 7 tips to guide you through the process:

1. Identify the Products to Resell

You can resell literally any products that come to mind, from apparels to electronics, but a good first step is to first understand the current trend and if it’s worth investing the time and effort to compete against competitors. Another alternative is to start with products that you love or have been using, which makes selling a lot easier since you understand the product best.

2. Legal and Permits

Like any other businesses, there are some legal requirements before you can operate your online business in the country, and the Philippines is no different. This is important if you have plans to scale and grow your business and the last thing you want to avoid is legal issues with the authorities.

Hence, once you have identified the products you wish to resell, immediately seek out the relevant authorities and attain permits to ensure your products are legal to sell.

For the Philippines, you need the following documents:

  • Registering your business with the DTI or SEC
  • Obtaining a BIR Certificate of Registration (Form 2303)
  • Mayor’s Permit

3. Suppliers

Once you’ve obtained the relevant permits, the next step is to start searching for suitable suppliers if you do not have existing inventories. A good way to shortlist suppliers is to analyse their charges and calculate the profit margins.

If you are intending to start a clothing reselling business, the type of suppliers that you can reach out to includes manufacturers, retailers or even resellers from another country, who are selling their products at an attractive price.

Alternatively, Google can be another method to source for suppliers. Use keywords like “bulk clothing suppliers Philippines” or “Philippines shoes wholesaler” to conduct your research. This process may take longer but it’s essential if you do not have existing contacts.

Finding the right supplier is crucial because they are considered your business partners. Without them, you do not have any inventory to resell. So it’s important that you build a good working relationship where both parties are agreeable to the respective terms and conditions being laid out, which should be beneficial to both.

4. Pricing

Since the online reselling business is fairly easy to start, this can also imply that you are entering into a competitive space. So to compete with your competitors and stay ahead of them, always conduct thorough research on pricing because you do not want to sell products that are priced significantly higher than your competitors.

Hence, once you get a general sense of the price trend for your product, speak to your suppliers and work out a deal to get the lowest price possible for bulk orders. That will enable you to price your products more attractively, while not sacrificing your profit margin.

5. Ecommerce Website Builder

Once you’ve gathered all the necessary information, now it’s time to build your ecommerce website for your online reselling business.
As there are plenty of online website builders available in the market, always understand what are your business requirements so that you can make more sound decisions when it comes to choosing the right platform for your business.

We have an article covering ecommerce platforms, what are the different features available and which is the best ecommerce platform in the Philippines, which will help you better understand the things to look for in an ecommerce website builder. 

6. High Quality Product Shots

Quality products and high quality product images should go hand-in-hand. It is only right to show your customers the most accurate information to help with their purchasing decisions. By having quality product shots enable you to present finer details of your products, which can help to convince your customers to purchase.

These high quality product shots can also help to make your ecommerce website look more visually appealing and professional, which are good signals to promote the legitimacy of your online reselling business.

And if you are intending to run an online food reselling business, do check out this article to learn more about food photography.

7. Social Media

The final step is to promote your online reselling business and the best way to do this is to utilise social media. As your business model operates digitally, it only makes sense for you to tap into digital marketing to build a digital presence for your brand.

Social media is a good first step as it does not require much investment because platforms such as Instagram, Facebook and Tiktok are free to use. And the best part is, there is a high reach on these social media platforms.

Hence, start sharing posts on your owned social media channels and run social media ads if you decide to amplify your post for better outreach.

Ready to Start Your Own Online Reselling Business?

Now that you have understood what online reselling is all about and the requirements to start one. If you are ready to give it a shot, do check out our ecommerce website builder that allows you to start your online reselling business at the comfort of your home. Simply visit our website and register for a new account to begin!

Common Questions About Online Reselling Business

Do I have to pay tax for my online reselling business?

You can be exempted from paying tax If you are a new business owner and your revenue does not exceed PHP100,000 within a 12 month period.

Is it illegal to resell items as a business?

No, reselling is allowed in the Philippines so long as you are not selling counterfeit products. Always make sure to comply with any legal requirements, such as registration and taxation before starting your online reselling business.

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