I have a question about becoming an online dealer in a certain niche and product. I found a company that distributes products that are made overseas. The company is only one state away and everything checks out. Even the product is better-made-quality than USA products and have a great report in America. People are quickly catching on to this factory that builds this item and across message forum around the world, people are recommending this product due to quality. Another great thing is not too many caught on to this and there are hardly any dealers. However, the buy-in is a little less than $15,000 due to the fact I don't have a store front. Internet-sales and residential sales only. I see no point in paying rent / heat / electricity for a store front when internet is cheaper and SEO will be virtually easy on this product due to little competition. I promise this isn't a niche you already have or even think about. That's why I am eager to this. So you can tell me your secrets, since we're not competators. Please tell me if buy-ins are set in stone or if that price is negotiable. Please tell me some more tricks of the trade and pointers. God knows I need them. Thanks
Not every company has a minimum buy-ins set in stone, but the hotter or more in the demand the product, the less likely they are going to negotiate. The high minimums for internet based operations are for the exact reasons you stated - the additional costs of operating a store front. They want to support and product their dealers from small internet based start-ups that will undercut them on pricing. If you have an established online sales history they will more likely to lower the minimum vs somebody who likes they product and "thinks" they can sell a lot of it. The less you are willing to buy, they less confidence they are going to have in your ability to move their product ... i.e. if you don't think you can sell $15K of their product, why should they? They likely want a few quality online dealers rather than a lot of small time operators. All you can do is offer a lower buy-in and see what they say - there really aren't any "tricks". An offer of $10K is going to have a much greater chance than someone who says "sell me $1,000 and if it goes well, I'll buy more". If you don't have an established track record, then your chances are probably going to be pretty slim. Another option might be to try and find someone who is a dealer and has a retail store front and work out a deal to share the profit on any sales you generate online and send to them.
Wow, great insight mjewel, very informative. I've been looking for resources online for more information, but seems this kind of info isn't as plentiful as one might think. Do you know of sources to gather more information? This is a big leap for me. In the past I would buy something used for dirt cheap and flip it for a nice profit, due to the economy, it seems finding stuff cheap isn't as readily available anymore, like it was a year ago. Now I'm looking for an alternative... going in with the big dogs since I have experience and reporte.
My knowledge comes from experience. In the past, I've run a retail chain of 100+ stores, a manufacturing business, as well as a few other similar businesses. Each company has it's own policies and you situation is really going to be specific to this company. The bigger the company, the less flexible they are likely to be. Some companies set high minimums because they don't really want their product sold on the internet, at least at discount pricing. This is more common with brand name merchandise that has strong dealer support. There can be restraint of trade legal issues, so they set high minimums knowing it will keep away the business they really don't want. You just need to sell yourself as best as you can and see if you can work out a lower minimum - but this can be a diametric argument.
That's just it too, after I tally up $1.5k, I'll need to have the advantage over other sellers (and I can't seem to find any online sellers of this product) -- which is a good thing. The item sells for $800 and I get it for $250 (for buying large bulk) I can hope to sell for under $500 to double my money on each product and hopefully turn it fast. The sales rep has not told me if I am bound to sell for a "certain" price. Then again, I didn't ask. Right now I'm researching Microenterprise for funding. Your knowledge is very helpful. Thank you!
Yes i willing to share you some trade tips even you're in same niche with me. The price is negotiable and it apply to every company. In order to do it,you must have buy a certain amount of the product in order to eligible to take the product at discounted price. And you should go for big company coz they offer more discount than smaller company. You should take advantage of the years end coz they willing to sell all the current stock at cheaper price and then restock the new stock for the next years