Australian Wholesalers – Do you really need an ABN to buy from wholesalers in Australia?
One of the most common questions I get is: do you need an ABN (Australian Business Number) to buy from Australian wholesalers?
The answer is yes, you need an ABN to buy from most genuine Australian wholesalers. Some may also require you to have a registered business or company name. Some genuine wholesalers will sell to people who don’t have an ABN, but they are few and far between and usually don’t stock particularly popular products. Don’t worry though, keep reading and you’ll discover how anyone can easily meet these requirements for little to no cost.
Why won’t they sell to people without ABN?
A wholesaler uses the ABN of a potential customer to confirm their business identity, to help verify that they really are a business customer, and not just an end-consumer (general public) trying to obtain discounted products. This is also why some Australian wholesalers prefer to only deal with people who have a registered business name (although many do not require this).
Australian wholesalers’ job is to sell to Australian retailers… and NOT to the end customer or the general public. If a wholesaler started selling products to end customers, bypassing the retailers, he would not only make the retailers very angry, but would probably also lose a lot of valuable retail customers/stores. In fact, they would be cutting/stealing market share from retailers, which is not a good business move.
Some wholesalers/distributors, especially those of popular brand name products, also like to ensure that their products are only stocked by reputable wholesalers that they consider ‘of a high enough standard’. By making sure that they only sell to people who meet certain minimum requirements, namely an ABN and most likely a business name, they are helping to ensure that their product is only available at what they consider to be quality outlets.
If someone tries to tell you that you don’t need an ABN to buy from Australian wholesalers on your wholesale list, alarm bells should start ringing. Either they are not telling the truth, or most of the so-called wholesalers are nothing more than discount retailers.
Isn’t it expensive and difficult to get an ABN?
No, anyone who is a resident of Australia for tax purposes can apply for an ABN free of charge; you do not need any other records besides your Tax File Number to be eligible for an ABN. You can apply for one online at the ATO (Australian Tax Office) website, www.ato.gov.au, or by calling them on the phone.
A business name costs a little more, but can be registered for no more than $100 to $200 in most states. For most retail activities in Australia, you will find that you do not need any specific license to operate, however you should check the licensing regulations in your state before registering your business name. More information on ABNs, trade names and license requirements can be found on the Australian Government’s business website, www.business.gov.au.