need help to start a business

[Marvin W]

Dear all,
I'm thinking to import some gift products from Thailand.
I hope you can help me with some information, I need to know how the local retailers deal with distributors.

I'd like to sell my gift products to local retailers and I'm considering 2 options:

1. As a distributor, whereby they buy my products, maybe on credit terms? what are the terms and conditions?
and they can sell at their own marked-up price?

or

2. Sell on consignment? whereby i ask them to sell my products at a certain fixed price and give them certain commission? if so, what percentage should be considered ideal?

which option would have a higher chance of success? which one would be more attractive to these retailers and which one should i adopt?

your kind reply would be very much appreciated,
thank you in advance.

regards,
Marvin

[Guest]

i think the retailers would be more interested if you sell them on consignment....since you are a small start-up

[Strong Eagle]

Marvin,

You need to do a bit of research. First, you need to find the prices of comparble products to the ones you are peddling. If you are importing purses for example, then matching your product side by side will tell you the expected retail price.

The retailer will want to pay you about half of the retail price. Can you make a profit from that wholesale price? Middlemen get squeezed unless the products are good.

You also need to look at potential retailers. What sort of mix to they have and what is the median price of the stuff they sell. There is no point in trying to put your stuff into retailers that don't have the right crowd for your product, and there is no point in a shop where your stuff is either the cheapest or the most expensive.

Retailers like consignment because you bear all the costs of inventory. If you need to go the consignment route, you'll need to decide how pieces are paid for. You want them to pay for any missing pieces... that way they are responsible for theft. They will only want to pay you off the register tape of items actually sold, and I would not do consignment that way. Too risky.

You are better of selling merchandise and it is common to allow established businesses credit terms, net 15 or net 30. Don't extend credit for longer periods unless you charge interest, and in any case, a viable business pays its bills promptly... a business in trouble will put you off and if they go under you are stuck.

[MMM]

hi strong eagle...
thank you for the advice....
they are really helpful...
i'll do more research and come back soon

thanks for your time

[stuff]

Hi Marvin,

I am a potential gift retailer.....just starting up. What sort of gifts you plan to import and price point? Maybe we can discuss further.

[stuff]

My email is reachstuff@gmail.com