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Question by : What is the difference between a wholesale supplier and affiliate marketing?
I want to start an online business and I am not sure what is the difference between a wholesale supplier and affiliate marketing. I understand that wholesale companies will dropship for you and affiliate marketing is based on sales. Which one should I do? Should I do a combination of both? Also, do you need a shopping cart for an affiliate marketing business?? Thanks!

Best answer:

Answer by Jake
If you understand that working with a drop shipper means that you sell the product and they stock it and ship it for you and affiliate marketing where you market another vendors product for a commission when a sale is made then you need to ask yourself what you would be more comfortable doing and what you think you could make money doing.

Both types of business you will have to do the same thing as far as marketing the site to get the traffic you need to make a conversion. Just because you publish a website for either type business doesn’t mean you are visible to the search engines and the public at large, that takes work to get that ball rolling. I would suggest that you go to an article directory an put in an inquiry about the things you need to do and I will also give you some info on some of the things that need to happen to get started.

If you plan to incorporate then you need to register with the federal,state and city government. If you plan to run the business as a sole proprietor then all you need is a business license from your local city government. Some cities do not require you to get a business license until the business makes $ 3,000 to $ 4,000 so see what your local government requires for an e-commerce business.

Steps for getting started:
First and foremost write up a business plan.
1. Forming the business either through incorporating or as a sole proprietor. If you plan to incorporate then you need to get with your states Secretary of State to do this.
2. Find your SIC and NAICS code you will need either one or both for your business formation with the government entities.
3. Getting an EIN if required
4. Setting up a Franchise and Excise Tax and Sales and Use Tax account with the Dept of Revenue in the state you are in. You need to determine if you need one or both of these accounts. Just call the Dept of Revenue in your state and they are usually pretty helpful in answering all your questions.
5. Set up a business bank account or bank account with a DBA attached to it if you plan to do the business as a sole proprietor if you incorporate then a business bank account is what you need.
6. Set up a merchant and or paypal account. The merchant account you can set up through your bank and this allows you to take all major credit cards.
7. Build a website and get a domain name and hosting. You can either build your own website or have one built for you, some start out with a blog because it’s free and you can make it look like a standard website so take a look at this option and see if it will work for you. Just keep in mind if you use a blog you need relevant content in the body of the blog if it’s just full of product links then you will eventually get shut down. As far as building your own you can either buy software or use the online website builders. Using the software allows you to create your site how you want it just make sure the hosting provider you use will support the software, with the online website builders you will be limited to their templates and I believe you have to use their hosting but you can buy your domain name from anywhere and just direct to their server.
Research SEO for your website, SEO stands for Search Engine Optimization and you can read about this at any article directory. Once in the directory put in a search for what you are wanting to read about and you should get some articles to read up on. If your search comes up empty or not what you are looking for just reword the search until you do. The info is there you just need to use the right phrasing. If you are on a tight budget you may also look into free ways to market your site.
8. Get inventory.
9. Figure out how you plan to ship product. This all comes down to how you plan to handle inventory. Some people have their own and some get involved with companies that have the product and you sell it and they drop ship the product for you. This saves on you having to carry the product yourself and having unsold inventory in your possession. If you plan to do affiliate marketing then you need to sign up to the affiliate programs and get your code specific links to post on your site.
10. Marketing your website. Just because you publish a website doesn’t mean it’s visible to the search engines and the public at large so you need to submit the site to the 3 top search engines at the least and start marketing the site.

This is a basic order and some of these may overlap each other during the process but I hope this helps out. I’ve been through the routine and had to figure it all out myself. Just ask a lot of questions with the people you are dealing with to get things in order.

What do you think? Answer below!