If you’re into a business that promotes health, nutrition and natural beauty, buying wholesale virgin coconut oil (VCO) and selling them at retail price can be a lucrative business model. As we have discussed in our previous articles, virgin coconut oil is a wonderful product, which provides not only hundreds of health and nutritional benefits but also lots of beauty benefits.
Looking for a reliable virgin coconut oil manufacturer or bulk supplier can be challenging, as there are many factors to be considered, which include the price, quality of the product, extra services, distribution channels, and the people you’ll be dealing with.
If you’re looking for a great deal, purchasing wholesale virgin coconut oil from the Philippines is a wise decision. The Philippines is one of the largest coconut producing countries on the planet and the world’s leading exporter of virgin coconut oil. As a tropical island country, coconuts are traditionally grown organically by Filipino farmers.
Coconuts are considered by Filipinos as the “tree of life” so if you’re planning to buy wholesale or import virgin coconut oil in bulk from the Philippines, here are some useful tips you should keep in mind.
1. Register your business and get the necessary licenses.
Having a business which is legitimate and licensed will help you earn trust and confidence from potential VCO suppliers in the Philippines. It will also help them realize that you’re into a serious business and your consumers are protected. Hence, start with the business basics, which include securing a business license, permit to sell or retail, tax identification number, and other specific requirements to import and distribute virgin coconut oil in your country.
2. Decide what type of virgin coconut oil to buy.
Not all virgin coconut oils made in the country are the same. They vary depending on the processes of production. VCO is produced in the Philippines using 2 basic processes, namely fresh-dry process and fresh-wet process. The fresh-dry process involves extracting VCO from fresh coconut meat after drying it. On the other hand, the fresh-wet process extracts VCO from fresh coconut milk using modified natural fermentation, modified kitchen, Bawalan-Masa process, or centrifuge method (source).
Virgin coconut oil sold in the global market may be certified organic by International bodies such as the USDA and its accredited certifying bodies around the world. However, most VCO manufacturers in developing countries like the Philippines don’t have the financial capacity to meet the costly processes and requirements by international organic certifications though coconuts are traditionally grown organically in the country for centuries. Thus, instead of investing in organic certifications, they invest more on quality of their VCO products.
Also read: Koko Oil’s Organic and Fair Trade Statement
Before deciding what type of VCO to buy or import from the Philippines, decide first what you want to sell. Identify your target market and understand what type of products do they need. Do they want the highest quality of virgin coconut oil, the most affordable, or both? From there, you can decide what to sell to your target consumers and decide what to buy from potential suppliers.
3. Decide how much to buy.
After deciding what kind of virgin coconut oil to buy and sell, the next step is to determine the volume of VCO demand, the supply needed, and your capacity to store inventory. Buying or importing virgin coconut oil in a larger quantity can give you a lower price, but can you store them safely while you’re still waiting for orders from customers? Therefore, to keep your business healthy, always check the balance between your supply and demand.
4. Search for VCO suppliers.
Now that you’re ready to import or buy wholesale, it’s time to search and find your virgin coconut oil suppliers. Looking for VCO manufacturers or suppliers can be done online and offline. Here are some of the top places where you can find them.
Search engines – You can simply use Google to search for a list of premium virgin coconut oil manufacturers from the Philippines. Most of the top VCO companies in the country have websites which are indexed by Google and other search engines. After discovering them on Google, you can visit their websites and read their important information, such as company profile, product pages, terms and contact details.
B2B sites – You can also join Alibaba, Tradekey and other related B2B marketplaces , where virgin coconut oil sellers, traders and buyers from around the world meet online and do transactions.
Associations – Another way is to visit the online directory of the Virgin Coconut Producers and Traders Association of the Philippines (VCOP) which lists all of its member VCO producers and traders operating in the country.
Trade shows – There’s also a good chance that you will meet owners or representatives of VCO producers and suppliers from the Philippines in international food exhibitions.
5. Get to know your suppliers better.
Once you have identified your prospective virgin coconut oil manufacturing partners, dig a little deeper by doing a background check. Here are some tips to know your potential VCO suppliers better:
- Know the processes or methods used in producing their VCO product.
- Check if they actually have a manufacturing plant.
- Ask for a company profile to know the people behind the organization.
- Ask for their business licenses and certifications, such as certificate of registrations from Securities and Exchange Commission (SEC), Bureau of Internal Revenue (BIR), Philippine Coconut Authority (PCA), and Food and Drug Administration (FDA).
- Ask for product samples.
- Know the extra services and after-sales support they provide.
- Talk to the owners of the VCO companies to know them better.
- If possible, visit the place and manufacturing plant of your potential VCO partner to discuss important things and cement a long-term business relationship
6. Ask for the terms and price.
Before closing the deal, make sure that you understand their terms and policies for exporting or selling virgin coconut oil. Here are some things you should know when buying wholesale virgin coconut oil from the Philippines:
Samples – VCO exporters usually provide free samples to importers to let them check the quality of their products.
Terms of payment – This determines if the payment will be made in full or in installment which requires a down payment.
Mode of payment – This declares whether the payment can be made through bank transfer, online payment gateway (e.g., Paypal), cash on delivery, and other modes of payment.
Availability – This states the number of days the VCO shipment will be delivered to the buyer from the date of order. The duration can vary depending on the volume of order and the arrangement on the packaging.
Mode of delivery – This describes the situations where sellers deliver goods. This can be Ex Works (EXW) or Free On Board (FOB). To learn more about EXW and FOB, read this article from Investopedia.
Minimum order quantity – This is the minimum quantity that VCO exporters or suppliers are willing to sell and ship to the buyers.
Export price – The export price varies depending on the quantity, quality, package size and configuration of the ordered virgin coconut oil.
Export packaging – This includes the terms and rates set out for exports that need retail packaging and private labeling. You may read Koko Oil’s Export Packaging Brochure for reference.
7. Close the deal and wait for your order.
If you’re already convinced to do business with your chosen VCO partner, it’s now time to close a deal. When dealing with a virgin coconut oil exporter from the Philippines, the importer or buyer has to make sure that the virgin coconut oil will be packed correctly so that it will arrive in great condition, labeled correctly so that it will be handled properly and arrive on the right time and at the right place, documented correctly to comply with the local and foreign government requirements including tax and custom duties, and insured properly against damage, loss, pilferage and even delay.
Due to the extensive work involved in exporting merchandise from the Philippines to other countries, most exporters rely on an international freight forwarder to accomplish those services above. To learn more about the export documentation, shipping, and logistics in the Philippines, read this guide.
Running a wholesale or retail business requires a reliable and trustworthy supplier who will be your long-lasting business partner. If you’re looking for a bulk supplier and exporter of virgin coconut oil from the Philippines, Koko Oil is here to serve you. Leyte Koko Oil, Inc. is a premium manufacturer of 100% organically grown raw virgin coconut oil with office and manufacturing plant in Leyte, Leyte, Philippines. Contact us now to become our happy and valued virgin coconut oil business partner.