Many online merchants and small-time sellers have adopted the drop shipping business model. In short, the supplier (that you can find through SaleHoo) drop ships the product right to your customer, which lowers your overhead costs and eliminates inventory control. In this SaleHoo Review, I am going to share everything that I know – both good and bad, about SaleHoo’s wholesale directory tool. I have included a list of pros and cons that I have gathered over my four years of using SaleHoo for my ecommerce business.
And in case you missed the studies about drop shipping.
22-33% of internet retailers have adopted drop shipping as their primary method of order fulfillment. 84% of online sellers find that establishing a drop ship supplier or wholesaler relationship is the #1 roadblock to starting an online business.
What is SaleHoo?
SaleHoo is not a direct supplier itself – it is a wholesale directory that connects you with thousands wholesalers, drop-shippers, liquidators, and manufacturers. The company is based out of New Zealand, but most of their suppliers are from the USA, UK, Canada, Australia, and China.
It is an online selling tool that you can use to search for and compare various suppliers and products. Using the offered tools, you will be able to search for products to sell by product name, brand name, and category.
It is good to note that SaleHoo does not actually sell anything – the service is a sourcing tool for online resellers.
Is SaleHoo legit?
SaleHoo offers a referral program, so there are multiple SaleHoo reviews on the internet. I have read them all, and I can tell you that some hype up the product while some feel that is a scam. As an ex-SaleHoo customer, I can tell you that SaleHoo is far from being the best tool for sourcing products, but it is a legit service.
I ran an online drop shipping business on eBay, Amazon, and my own online store for 4 long years. I used SaleHoo to find products to sell for my drop shipping business. While I was able to find products to sell, I did not become a millionaire. On the positive note, SaleHoo gave me the opportunity to become my own boss and work for myself, which is something that I was interested in right from the beginning. In mid-2016, I sold my drop shipping business for a nice chunk of money so that I can focus on my family. This has opened doors for other online projects that interest me.
While the drop shipping business model has changed over the years and competition is now at an all-time high, you can still make a substantial amount of money using this system. Whether you want to be your own boss or looking to add an extra income flow to support your family, I feel that this is still possible, but difficult.
As a real, ex-SaleHoo customer, I can tell you the SaleHoo is not a scam and that it offers a real product at a recurring cost. I wish I have the necessary resources to tell you if SaleHoo will work for you, but I do not. The only way to find out is to sign up for the service and decide on your own.
I was able to find what other customers had to say about SaleHoo (see image below for positive reviews):
And then there are SaleHoo complaints that I found on the internet:
Carolyn Gaza states: “They try to help but couldn’t find me any drop shipper that deals with name brand unlocked cell phones can be depressing after a while.” (Commenter on Best Company)
Selfless Marketer states: “I have used and do not think much of it. It’s very difficult to find products that you can make much of a profit with.” (Commenter on Warrior forum)
Carol Smith states: “I can say that i tried out Salehoo for a while and was not impressed. I was attempting to find products to resell on eBay. I looked for weeks without finding much at all. I would not recommend it if your plan is to sell on eBay.” (Commenter on Warrior forum)
How does SaleHoo work?
If you made it this far, you now know that SaleHoo is not a scam. Now it is time to see how it actually works.
Basically, after you gain access to the service, you can search for products and suppliers that you are interested in working with. When you find a product that you want to sell or a supplier that you are willing to work with, it is a self-explanatory process from there – contact the supplier and make necessary arrangements.
While the overall process is simple, you will have to decide whether you want to have your products drop-shipped to your customers or buy the products in bulk and arrange your own shipping. Each method has its set of benefits.
When you find a supplier that you are willing to work with, you can contact them directly to place your orders. Each supplier page provides you with various statistics such as shipping time-frames, minimum order amounts, etc.
This is the process for drop shipping your goods:
You first sell the product on eBay, Amazon, online store, or wherever else you plan on selling. Only when you make a sale, you buy the product from one of the suppliers in the directory and they will ship the product right to your customer. For example, you sell the item for $100, but buy it for $50 via SaleHoo. You keep the difference, minus any fees (eBay fees, credit card fees, PayPal fees, etc.).
This is the process for buying the products in bulk:
In order to qualify for wholesale pricing, you buy the products bulk and ship them to your warehouse. After you receive the products, you store the inventory in your warehouse. After you make a sale, you ship the items right to your customers. This method is riskier as you have to buy the products upfront and you have to have enough space for inventory.
Lastly, every supplier that is listed in SaleHoo’s directory undergoes a strict verification process, which eliminates fraudulent activity and Chinese counterfeiters. This ensures that the supplier is an actual company.
Can I make money with SaleHoo?
You are reading this SaleHoo review because you are wondering if you can make a profit using this product. I am here to tell you that you can, but it is not going to be as easy as you think. Every year, there is a dramatic increase in the amount of consumers that shop online, which benefits those that sell products online.
As mentioned above, the market is over-saturated and competition is at an all-time high. But this does not mean that you cannot grab a chunk of the market share for yourself. With that being said, SaleHoo offers multiple tools for competition insights and other market analysis tools. At the end of the day, profit margins vary by factors such as niche, product selection, and competition.
The problem with SaleHoo, and all other similar directories, is the fact that not all of the items listed in the directory are cheap enough to sell profitably on eBay and other marketplaces. In some extreme cases, I have seen products selling for less on eBay than through one of the wholesalers. On the flip side, if you do some research – and do not go for the products that everyone else is selling, but go for accessories and other related products instead – then you can scoop up some nice deals.
You can review that image below for sample profit margins:
Keep in mind that all of the fees are not added to the above profit margins. I feel that it is the best to calculate all of the fees that you are going to pay before making an order. That way, you will know what to expect.
I recommend using Google AdWords to do your research and configure your marketing campaigns. Google AdWords is a free tool that you can use to see competition levels and other key statistics.
How fast can I start selling?
After you create your SaleHoo account, you can start working with suppliers immediately. The good thing is that the drop shippers do not require you to make an initial investment (no need to buy in bulk, the minimum order quantity is 1 unit). In addition, over 80% of suppliers sell internationally, so no matter where you are, you can be up and running in no time.
Furthermore, SaleHoo offers an online store builder that goes in hand with the wholesale directory, but it does have its own monthly fee.
How much does SaleHoo cost? What do I get?
Access to the wholesale directory alone costs $67 a year (see membership here). As mentioned above, the directory has 1.6 million products and 8,000 suppliers.
You can pay for the membership using PayPal and all major credit cards. You also get access to their seller training center, community forum, ecommerce blog, tutorials, and market research tools. With the exception of the 60-day money back guarantee, there is no free trial or test period available.
I feel that the seller training center alone is worth the cost as it helps you sell online whether you plan on using their service or not.
SaleHoo store builder
SaleHoo offers an online store builder that costs $27 a month for the Basic plan, $47 a month for the Standard plan, and $97 a month for the Premium plan. With the $27 a month plan, you can add 200 products to your store, save 600 images, and you get 200MB of bandwidth.
You do not need any experience to set up a store. You get 15 professionally designed store templates. And, you get many built-in marketing tools. While there are better options for building a store, I feel that SaleHoo Stores is good for building a simple store in a short amount of time.
Can I cancel SaleHoo?
You can cancel the service at any time. If, for whatever reason, SaleHoo does not meet your expectations or you are unable to find products to sell, you can cancel your membership by calling or emailing their customer support department.
Your purchase is covered by a 60-day money back guarantee. If you cancel before the 60 days are up, you will get a full refund. When I cancelled my membership because I shifted my focus to other projects, they asked for my receipt number that I received when I first joined SaleHoo.
Support and resources
The customer support department is available via phone and email Monday to Friday between 5:30 p.m. to 1:30 a.m. Eastern Standard Time. They can be reached at 1.800.322.7952.
In addition, SaleHoo offers helpful resources such as the market research lab, seller training center, community forum, and an ecommerce blog dedicated to helping you sell online.
Due to the nature of the product and number of available resources, there are not many times that you will really need to contact the support department. I contacted their support team 2 to 3 times through my 4 years of using the service.
For example, I was interested in selling RC cars. I contacted their support department for some assistance. The support representative directed me to a few suppliers and provided me helpful information on ways of increasing my sales, which I found useful for my drop shipping business.
How to get the best results on SaleHoo?
If you are new to drop shipping and never sold anything online, my advice is to go through all of the guides in the seller training center to familiarize yourself on how things work. I recommend noting your product ideas and the suppliers that you want to work with. The general rule is to find at least two to three suppliers for every product and compare the costs.
After you narrow your search down, try to see what other users think by posting questions and asking for feedback in ecommerce forums. I cannot stress this last part enough; just because John Doe is having success selling video games does not mean that you will have the same results. Try to think outside of the box.
- You get access to a complete wholesale directory that offers 1.6 million genuine products and 8,000 verified suppliers.
- With the exception of the annual membership fee, there are no start-up costs (you do not purchase inventory upfront).
- Every supplier that is listed in the directory undergoes a strict verification process, which eliminates Chinese counterfeiters and fraudulent suppliers.
- The 60-day money back guarantee protects your purchase in the event that you are not pleased by SaleHoo.
- It is simple to find products to sell and build relationships with different suppliers.
- Location-based searching capabilities are missing (there is no way of searching for suppliers in specific locations – US, Canada, UK, etc.).
- There are a fair number of products that are cheaper elsewhere.
- You are paying $67 a year for a list of suppliers that you can ultimately find on your own.
SaleHoo Review – Conclusion and recommendation
In short: SaleHoo is good if you are just starting out and do not want to risk losing a lot of money. It is a great alternative to importing from China.
Over-saturation and Chinese counterfeiting has made the process of finding products to sell difficult. A service like SaleHoo eliminates all of the risk for the seller as it restricts access to illegitimate companies. When you make a purchase from one of the suppliers in the directory, you know you are dealing with a verified supplier that sells real, genuine products.
However, if you have a lot of time and know where to look, you can find legitimate suppliers without having to pay for a service like SaleHoo. I know a fair share of sellers that import genuine products from China without any issues whatsoever. But when you factor in all of the custom fees and risk, importing products from a foreign country may not be something everyone is willing to try.
If you do not mind paying $67 a year for a wholesale directory, I would recommend using SaleHoo. If, for whatever reason, SaleHoo does not work for you, you can get your money back. At least, you will get the opportunity to get your feet wet and start building business contacts and relationships with suppliers.
You should use SaleHoo only if:
» You want a drop shipping business and the option to buy products in bulk.
» You do not have the time to search for suppliers on your own.
» You have a difficult time finding products to sell.
» You sell more on an online store than on third-party marketplaces (e.g. eBay, Amazon, etc.).
» You do not overlook the importance of research.
You should stay away from SaleHoo if:
» You do not have the budget to pay $67 a year for the membership.
» You sell mostly on eBay and Amazon.
» You do not feel comfortable running a drop shipping business.
» You want to sell popular products that many other sellers are selling right now.
» You are skeptical about SaleHoo (the best decision maker is your gut feeling).
That concludes my SaleHoo Review. I hope that, after reading this review, I provided you with enough information so that you are able to determine whether or not SaleHoo is for you.