How to negotiate wholesale prices with distributors

Most new wholesale sellers take the first price a distributor sends and assume it's fixed. It usually isn't. Amazon's own guide to finding wholesalers puts it this way: "remember, the numbers are probably negotiable."

The catch is that a seller placing a first order has very little to negotiate with. So this guide is about timing as much as tactics: when you actually have leverage, what to ask for besides price, the exact words to use, and how to catch the price changes that slip into reorders.

If you don't have a distributor yet, start with our guide to finding Amazon wholesale suppliers and then how to open a wholesale account. For the very first message to a new distributor, use our distributor email templates. This page picks up once you have an account.

Start with the relationship, not the discount

The best wholesale negotiators aren't the most aggressive ones. They're the most reliable. A distributor gives better prices and terms to accounts it trusts: accounts that pay on time, order on a rhythm and answer emails the same day. On your first order or two you have none of that yet.

So on a new account, the usual best move is to pay the list price, pay on time, and ask one question: what would it take to qualify for better pricing or terms later? Maybe it's an order size, a few orders paid on time, or a credit application. That answer turns your first orders into a path toward better terms, instead of an early request that gets a polite no. Script 1 below is the email for it.

Stef, who teaches Apex University, describes what changes once you're a paying account:

"At some point, when you're spending money with these companies, your sales reps will become an asset to your business. They will be like freelance employees that you don't have to pay. [...] They're going to reach out to you with promotions and discounts, and if there is a certain product that you buy month on end, they will notify you when their next shipment is coming."

From Stef's lesson (The Game, at 5:21)

That's the relationship you're negotiating inside. As Stef says in the same passage, reps make money when you buy from them, so a good negotiation leaves both of you selling more. Your rep is also the person who hears about promotions, closeouts and price changes before they reach the price list. Be the account they want to call first. Our guide to what changes as a wholesale business grows follows these relationships as the account gets bigger.

Know the most you can pay before you ask

The weakest way to negotiate is to ask for "a better price" with no number in mind. The strongest is to know, before you pick up the phone, the highest unit cost at which the product still earns the return you want. Every cent under that number is margin. Anything over it means you negotiate or you don't buy.

You need four numbers: the price you expect to sell at, Amazon's fees on that sale, what prep and shipping to Amazon cost per unit, and the return you want on your money. The calculator below works it out in its "Most I can pay" mode. It uses Amazon's referral fee table, and you type the FBA fulfillment fee from Amazon's Revenue Calculator.

Here is one example, to show the method. Say Amazon pays out $15.00 a unit after its fees, prep and shipping to Amazon cost $1.40 a unit, and you want a 25% return. The most you can pay is $15.00 divided by 1.25, minus $1.40, which comes to $10.60.

Now say the distributor's price is $11.40. You know exactly what to ask for: 65 cents off, a little under 6%. That's specific, it sounds reasonable, and it's much easier to say yes to than "can you do any better?"

The number also tells you when not to bother:

• The price is already under your number. Buy it. Save the conversation for the reorder, when you have history.
• The price is a little over. This is where negotiation pays. Ask for the gap, or for a lever that closes it, like freight or a volume tier.
• The price is far over. No discount you're likely to get will close the gap. Spend the time on the next product.

Our guide to analyzing a supplier price list runs this check across a whole list at once, and the Amazon FBA fees guide explains each fee in the math.

When to negotiate (and when to wait)

Timing does more work than wording. The same request can get a no in one month and a yes three months later.

At the reorder. This is the big one. You've paid the distributor, the product sells, and they'd like to keep selling it to you. Stef makes this point in the Restocking lesson:

"This is now your opportunity to ask your suppliers for discounted volume rates because we are restocking, meaning you already paid this vendor. You already have built some sort of rapport. This is where you will have a hard no, 'These are the final prices,' or maybe an actual opportunity to learn more about your supplier's flexibility when it comes to negotiations."

From Stef's lesson (Restocking, at 5:00)

When your order is about to get bigger. If a product is selling faster and you plan to buy more anyway, ask what the larger quantity is worth before you send the order, not after.

Near the end of a month or quarter. Many sales reps work toward monthly or quarterly targets, so a larger order offered in the last days of a period can get more attention. Treat this as a rule of thumb: not every rep has a target, and not every distributor works this way.

When you have a real competing quote. If another authorized distributor of the same brand quotes you a lower price in writing, you have a concrete reason to ask. More on this below.

When the price goes up. A price increase reopens the conversation. Ask why, ask when, and ask whether the old price can hold on your next order (Script 6).

When you want payment terms. After a few orders paid on time, ask what it would take to move to terms.

And when to wait: on your first order (ask "what would it take" instead), right after a late payment or a dispute, and when you're ordering less than you used to. Asking from a weak spot spends goodwill you'll want later.

What to negotiate besides the price

Unit price is the lever everyone pulls first, and often the one with the least room. A distributor that can't move the price can often move something else that's worth as much to you.

Volume pricing

Many distributors price lower as quantities rise, and Amazon's guide says the same: "Typically, the more you order, the lower your cost per unit." The question is whether the bigger tier is worth it for you. Stef runs through the questions to ask yourself when a supplier says the better price needs pallet quantities:

"Okay, how many units come in a pallet? Can you make that investment? How much bigger is the discount? Is this worth me pursuing, or should I just wait a bit and maybe place it on the next time I place a reorder for this item?"

From Stef's lesson (Restocking, at 5:30)

Three checks before you take a bigger tier:

1. Can you sell it through in a sensible time? Units that sit in Amazon's warehouses pay storage every month, and older stock can pay more. A volume discount is only a good deal if it saves more per unit than the extra months of storage cost. Our storage fees guide has the math.
2. Can you afford the cash? A bigger order ties up more money for longer. Our guide to what it costs to start covers keeping cash back for the next reorder.
3. Is the tier sized for you? Amazon's guide gives a useful test here: "if you want to buy 50 items, but the price break only happens if you buy 200 items, it might be a good idea to seek out other suppliers."

Payment terms

Terms can be worth more than a discount. When you prepay, your money is out from the day you pay the distributor until Amazon pays you for the units that sold (our guide to Amazon payouts and DD+7 covers how payouts work). Net 30 shortens that gap, which on a growing account can matter more than a few cents a unit. New accounts usually prepay, and our guide to opening a wholesale account explains what distributors check before they offer terms.

Some distributors also offer a small discount for paying early, written on the invoice as something like "2/10 net 30": 2% off if you pay within 10 days, otherwise the full amount is due in 30. If you have the cash, that's a price cut you can take without asking for anything.

Freight and where it ships

Freight from the distributor is part of your landed cost per unit, and on small orders it can be a big part. Ask what order size ships with freight included, and whether the threshold can come down for you. If you use a prep center, ask whether the distributor will ship straight there, which saves you a leg of freight. Our prep center guide covers working with one.

Smaller minimums and mixed cases

For test buys, ask for a smaller quantity instead of a lower price: a broken case, a mixed case across several items, or a lower opening minimum. Paying a little more per unit for fewer units is often the cheaper mistake on a product you're testing. Our guide to your first wholesale order covers sizing test buys.

A forecast instead of a promise

Distributors plan their own buying, so an honest forecast helps them: "we expect to buy about [quantity] of this over the next three months, based on our sales." Ask for the tier price on that forecast, or for notice before prices change on those items. Be clear it's a forecast, not a signed commitment.

Competing quotes

The strongest single piece of leverage is a second authorized distributor carrying the same brand. In the Finding Suppliers lesson (15:46 to 16:07), Stef points out that a very large distributor can be tougher to negotiate with, and that opening accounts with its competitors gives you an upper hand: if one quotes you one price and another quotes a better one, you can buy each product wherever it's cheaper.

A quote only works if it's real, current, from an authorized source and for the same product. More on that under what not to do.

Scripts you can copy

Each script makes one ask. Swap anything in square brackets for your own details. Email is better for anything with numbers in it, because you want the answer in writing. A short call is better for building the relationship, so many sellers call first and confirm by email.

A short phone version. "Hi [name], it's [your name] from [business]. Quick one: we're reordering [item] next week, and we'd like to make it a bigger order. If we take [quantity], what's the best price you can do?" Then stop talking and listen. Whatever they offer, finish with: "Great. Could you send that over in writing, so I can update our purchase order?"

If calls make you nervous, you're not alone. Stef's advice from the course:

"Don't be scared to call your suppliers. At the end of the day, those guys make money when you send them money, okay? They are in the business of making sales. You are in the business of making sales. It's a partnership, okay? We're not enemies here."

From Stef's lesson (Apex Applications Walkthrough, at 21:54)

When the answer is no

You'll hear "these are our prices" often, especially from the biggest distributors and on brands that set their own price lists. A no on price isn't the end of the conversation. It's a signal to change levers.

Ask what they can move instead. Terms, freight, a mixed case, notice before increases, or a spot on the list for promotions and closeouts. Script 5 and Script 6 are built for this.

Ask what would change the answer. "What would we need to order to reach your next tier?" gives you a target to plan toward.

Know when to walk away. If a distributor won't discuss anything, even after months of orders paid on time, or its prices keep landing above what other authorized sources charge for the same product, stop pushing and spread your buying. That's why it pays to build relationships with more than one supplier: you're never dependent on one yes. Our suppliers guide covers finding more, and the Distributor Vault is our directory of US wholesale distributors.

What not to do

• Don't ask for a discount before you've paid an invoice. Ask what it would take instead (Script 1).
• Don't invent a competing quote. Reps know the market. A bluff that gets caught costs you the relationship.
• Don't ask for five things at once. One ask per conversation, two at most.
• Don't buy a tier you can't sell through. Storage and tied-up cash can eat the whole discount.
• Don't make a threat you won't carry out. "We'll move our business" only works once, and only if you will.
• Don't let the terms you won slip. One late payment on net terms costs more goodwill than any discount was worth.
• Don't chase a cheaper price from a source the brand doesn't authorize. A retailer's or a liquidator's receipt isn't the manufacturer or distributor invoice Amazon's guide asks for in approvals, so a cheap buy can leave you unable to prove where the stock came from. Our guide to letters of authorization covers who can authorize you to sell a brand.
• Never ask a supplier to change an invoice. Changing a date, a quantity or a name to help with an approval isn't negotiating. It's falsifying a document, and your invoices are the records Amazon suggests sellers keep as proof that their stock is authentic.

So when you negotiate a different ship-to address, a split order or a deal on closeout stock, check that the invoice still comes from the distributor and still shows your business name and address exactly. Our guide to ungating invoice requirements goes through what Amazon checks on each line, and the account health guide covers the records to keep in case Amazon asks where your stock came from.

Catch price changes on your reorders

Price lists change, and the change doesn't always come with an email. A new list arrives with a few lines moved, a promotion you priced in quietly ends, a case pack drops from 12 units to 10 at the same case price, or freight terms change. On a product you reorder every month, a small increase you miss comes out of every unit you sell after it.

The fix is a habit, not a tool. Do this every time you reorder:

1. Record what you paid on every order

   Keep the unit cost, case pack, freight and payment terms for each product on each purchase order. Your last order is the price you compare against.

2. Compare the new price with your last order before you send the purchase order

   Go line by line, and check the case pack as well as the case price: fewer units in the same case is a price increase.

3. Re-run the numbers at the new cost

   Still under the most you can pay? Reorder. Over it? Negotiate (Script 6), find a second authorized source, or pause the product.

4. Check the invoice, then update your costs

   When the goods arrive, check price, quantity and case pack against the purchase order. Then update the product's cost, the day you win a better price and the day a price goes up, so your profit numbers stay true.

Doing it in Apex

In Apex Blue, each purchase order holds the unit cost for every line. When you submit an order, its unit costs become the cost of goods for those products in your profit and loss, and a cost you type in yourself always wins. Your past purchase orders stay on file, so the last price you paid is there to compare against when you build the next one.

For one-off deals, the Purchasing lesson (28:15 to 29:00) shows the move: when a supplier offers a discount on a single order, you change the unit cost on that purchase order and choose whether the new price applies to that order only or to the product's saved cost. That way a one-time deal doesn't overwrite your normal cost. The lesson was filmed on an older version of Apex, so the screens look different today.

A spreadsheet with one row per order works too. What matters is that the last price you paid is written down before the next order goes out.