How to Start a Reseller Business: Steps and Documents

This guide is for someone who wants to resell products they do not make and needs a workable order of operations: which products trigger extra rules, which business registrations come first, and which documents a supplier is likely to ask about. It is general information about business setup, not legal, tax or medical advice. Rules differ by state and locality, so confirm the final requirements with your state and local agencies.

Start by sorting the product: general goods or regulated devices

Short answer: before choosing a supplier, decide whether the products are ordinary goods or medical devices, because devices bring FDA rules that ordinary goods do not. Most “how to be a reseller” advice skips this step.

• General-purpose laboratory articles. Under 21 CFR 807.65(c), a manufacturer of “general purpose articles such as chemical reagents or laboratory equipment” is exempt from establishment registration when the articles are not labeled or promoted for medical use.
• Devices. A device is a different category. 21 CFR 807.3(t) defines a wholesale distributor as a person, other than the manufacturer or the initial importer, who distributes a device from the original place of manufacture.
• Retail outlets. 21 CFR 807.65(e) exempts “pharmacies, surgical supply outlets, or other similar retail establishments making final delivery” from registration; the section limits some of its exemptions (paragraphs (d), (e), (f) and (i)) to classes of persons located in a State.

For a medical-supply angle in particular, see the guide on how to become a medical supply reseller, which covers that case in more depth than this general walkthrough.

What you need

• A product category you have checked against the device rules above.
• A chosen business structure and, if you will trade under a different name, a DBA (assumed business name) registration where your state requires one.
• An Employer Identification Number (EIN) from the IRS.
• The state, county and city licenses and permits that apply to your activity and location.
• A state resale certificate or equivalent, where your state uses one, to buy inventory without paying sales tax at purchase.
• An account with a supplier, manufacturer or authorized distributor.

Steps

1. Pick a category and check whether it is regulated. Use the sorting above. “Reseller business ideas” are best treated as categories to check, not as a ranked list: general goods, laboratory articles not promoted for medical use, and medical devices each carry different obligations.
2. Choose a structure, then register it. The SBA notes that sole proprietors can be held personally liable for the debts and obligations of the business, while LLCs protect you from personal liability in most instances. Corporations pay income tax on their profits, unlike sole proprietors, partnerships and LLCs. A DBA does not give legal protection, but most states require you to register one if you use it.
3. Get an EIN. The SBA says it is free to apply for an EIN and you should do it right after you register your business. It also warns: do not apply for an EIN on websites that charge a fee.
4. Find the licenses and permits for your activity and place. The SBA states that most small businesses need a combination of licenses and permits from both federal and state agencies, and that local governments determine their own registration, licensing and permitting requirements. Start with your Secretary of State website and your local government sites. The guide on how to get a wholesale license covers the licence questions in more detail.
5. Handle the resale certificate and open supplier accounts. Resale certificates are a state matter. See resale certificates for medical supply distributors, then read how to become an authorized distributor and what a distributor agreement contains before you sign.
6. Know whether you are a distributor or a relabeler. Under 21 CFR 807.3(d)(1), manufacture includes repackaging or otherwise changing the container, wrapper or labeling of any device package in furtherance of distribution. A reseller that only passes products along is in a different position from one that repackages or relabels them.
7. Screen any paid “reseller program” before paying. See the FTC section below.

How to be a reseller, become a reseller

These phrasings describe the same path: registered business, licenses, resale certificate, supplier account. The steps above apply to all of them. Whether you buy from the manufacturer or from a distributor changes the supplier paperwork, not the business-setup steps. For the choice between reselling and a fulfillment model, compare dropshipping vs reselling.

What can go wrong

• Treating a device as an ordinary product. A device-labeled item pulls in FDA definitions (21 CFR 807.3). Decide the category first.
• Relabeling without noticing it. Repackaging or changing the labeling of a device package falls within the regulation’s definition of manufacture (807.3(d)(1)).
• Paying a third party for an EIN. The SBA says the EIN is free and warns against sites that charge a fee.
• Assuming one state’s rules apply everywhere. The SBA says local governments set their own requirements, and some FDA exemptions apply only to persons located in a State.
• Buying a “business opportunity” without checking it. Under the FTC Business Opportunity Rule, 16 CFR 437.1(c), a business opportunity involves a seller soliciting a prospective purchaser to enter into a new business, a required payment by the purchaser, and the seller representing that it or designated persons will provide listed kinds of help. If an offered “reseller program” fits that description, read the rule’s definitions before paying. This guide does not give a legal verdict on any program.
• Grey-market stock. Buying outside authorized channels carries its own risks, so confirm where stock comes from before buying.

When to get professional help

Ask a licensed attorney or accountant about structure, tax registration and liability. The SBA page on licenses and permits points to free counselors, and your state agencies can confirm which licenses apply. If you plan to repackage, relabel or import devices, get regulatory advice before you start, since those activities are treated differently from distribution.

FAQ

How do I handle how to start a reseller business?

Work in this order: decide whether the products are regulated devices, register a business structure (and a DBA if used), get a free EIN, obtain the federal, state and local licenses that apply, set up the resale certificate and supplier accounts, and confirm you are distributing rather than relabeling. Each step is explained above.

What documents do I need?

Typically: your business registration, your EIN, the licenses and permits for your activity and location, a resale certificate where your state uses one, and a supplier or distributor account application. The resale certificate comes from your state, not from the SBA. Suppliers set their own application requirements, so ask each one what it requires.

How long does it take?

There is no single timeline. The SBA says that the licenses and permits you need depend on your business activities and location and that local governments set their own requirements, so the time depends on the agencies involved. Ask each agency for its processing time.

What are the common reasons for rejection or delay?

Official agencies publish their own reasons case by case, so ask the agency or supplier that declined you for its stated reason. Requirements are easy to miss because they differ by level of government (federal, state, county, city), a DBA must be registered in most states if you use one, and a device-labeled product or a relabeling activity brings FDA definitions into play (21 CFR 807.3).

Sources

Sources checked on 2026-11-03.

• U.S. Small Business Administration, Apply for licenses and permits.
• U.S. Small Business Administration, Choose a business structure (structures, DBA, EIN).
• 21 CFR 807.3, Definitions, via Cornell Legal Information Institute.
• 21 CFR 807.65, Exemptions for device establishments, via Cornell Legal Information Institute.
• 16 CFR 437.1, Business Opportunity Rule definitions, via Cornell Legal Information Institute.