The Wholesale Forums

[jeaneeni]

Hi,

Just starting out importing good for first time....but hope to receive my first order from smallvolume soon. I'd prefer to sell large quantities onto large retailers in the UK, making a small margin of profit per product x thousands, rather than more profit per item. Any-one here doing that...any advice please, as I can see that if I did secure orders the I would need stock finance, as it could amount to hundreds of thousands!

Furthermore ..does any-one have an idea on what large UK retailers work on as their mark-ups?

Thanks for any help and advice.

[jdbtelecom]

I don't know whether you would be able to interest large UK retailers as they will have their own means of sourcing products.

Also they may not want to just trust a sole trader with thousands of £'s with not much experience in selling to retail and getting the best prices.

[greedyboy]

If you are dealing with the big boys (argos etc) they wont look at your product unless the margin is 40% plus.

Argos won't even talk to you, you are small fry (no offence). You have to sell to their distributor who sells into them.

If you want above average space (larger than a postage stamp!) in their catalogue, basically you have to pay (lots). If you advertise your product elsewhere they may also have 'an influence' how you promote and price your product. Some companies will not even put your product in their catalogue unless you pay for the space! TV shopping chanels are the same. You pay for slots how many you want.

If they have similar products you have to tender/bid to sell to them (securing them a rock bottom price!)

They work 6 months ahead producing their catalogues. For instance you would be selling in to them now for the all important Christmas catalogue. Oh and be prepared to part with some 'marketing funds' However as you are working so far in advance you can plan the production and finance. You essentially receive an L/C from them which if necessary you can borrow from a bank against (not recommended personally).

Large retailers can bankrupt you overnight unless you know exactly what you are doing, be warned. You have to know what you are doing and have a nice large cash flow.

Finally, unless you have sold in to them before just getting a foot anywhere near their door is impossible (unless you are Sony, Apple, Panasonic etc).

So in summary, it does have many advantages but it is not easy and you have to be able to back it up financially.

[jeaneeni]

Hi

Thanks for that - I can see that I would have to have hundreds of thousands...and the logistics are scary...still that's my goal. Have you sold to retailers....as you know alot- 40% is quite low, I thought it would be much higher!

Still researching stock finance ....for millions!

[greedyboy]

40% is minimum depending on the sector. You have to sell to their distributor who would expect around a 20% margin.

You don't need millions, you could do it with £20K (obviously depending on the product price).

Remember prices advertised in the catalogue include VAT so they are inflated.

Good luck if you are looking at holding that amount of stock! Peronally I woudn't recommend it plus there are too many flucuations such as the price of the dollar. Imagine a $5,000,000 stock order provisioned 3 months in advance and the dollar drops to $1.60 and you are working off $1.90? There could be a sudden shortage of components and then you manufacturing cost shoots up?

Also how well the product sells (if your product does not move quick enough, you are expected to drop the price by refunding the difference or they will ask to back the whole lot!). When playing with the big boys, you play by THEIR rules otherwise you will not be in business for long!

There is a better way of moving large stock quickly but at very, very small margins (see one of my other posts for a clue). However you better be good at selling combs to bald men (and women)!

Start small and work your way up.

[jeaneeni]

Thanks again.

Need to clarify though, as I obviously have no idea on the quantity they would require- you say only 20k ...if.. for example Argos decided to order say 1 item, I looked at perhaps they would want 30 a day for 978 stores per month ( 673 argos/ 305 homebase -as they can supply to them), as it's based on the catalogue (plus homebase) each store must have stock- e.g. 30 items per day available x 978 stores x 30 day (rough month) based on say £1 each to buy= £880,200??? a month.

I must be super way off here?!

I have a shipping container as storage organised close by...I can alway get a few more!

Also ...you talking of the dollar...and how it sells, from what you are saying.. they can
decide to change the pricing or they will decide to drop the product order, if non seller- is that what you mean?

I have just looked at your other posts...u do stay to start small....and more women should join! What levels are you selling at....small for me...maybe medium then?

[jeaneeni]

Have you just amended that ...I didn't see the $5million in the post b4. Do you see why I can't get how you could do it on just £20K?

I can sell to balding men and women!

....so the manufacturer changes their price when ever they want?

I'll search through...selling hotdogs at school, very good!

[greedyboy]

Originally Posted by jeaneeni

Have you just amended that ...I didn't see the $5million in the post b4. Do you see why I can't get how you could do it on just £20K?

If you are manufacture a product for £0.50 (silver earings for example) and a supplier initially places an order for 1000 units. That is only £500. However depending on what terms are agreed and the size of the customer, you could be suppling that amount weekly, monthly or yearly.

I can sell to balding men and women!

Do you want a job?

....so the manufacturer changes their price when ever they want?

No you agree a price when you place an order (or agree a contingency amount in advance). However when you are working so far in advance, your order may be placed nearer the delivery date (so you do not have stock sitting in your warehouse for 3 months).

So you have to factor in that US$ price may be higher or lower when you actually start the production or other costs due to circumstances beyond your control.

I was using this as an example as you were talking of millions. If you were dealing that amount you'd be using a Forex Trading company to handle the purchase of US$ on your behalf to minimise the risk.

I do exactl this on about 50% of my purchases from China as it assures me of a guranteed exchange rate for a length of time regardless of rate changes. The US$ was available commercially for over $2 late last week, which was a very good time to buy a load!

I'll search through...selling hotdogs at school, very good!

Amongst other things hence I am a thicko with hardly any qualifications. Although the hotdogs at break time from a food flask was very profitable

[jeaneeni]

Hi Greedyboy,

Thanks for your advice....you have your own degree in making a profit from trading...especially since you have been learning this since school and you're a billionaire!

I have a degree but then spent years researching the property market, prior to developing a few properties, which could have been another degree of my own...believe you me you don't learn the knowlege you have in uni, that's all your own experience.

Now I'm trying to find another income stream- so I have don't have to do a serious amount of DIY all day (7am -11pm to get things done quickly)... and deal with tenants....hey... I could paint your warehouse! Oh and thanks for the job offer...but I'll try my luck first though!!!!

I know I'm teeny tiny fry for the big guns but if I set myself a 12 month goal to learn and get experince...so back to the point I raised earlier...

I gave you the example of say Argos wanting just 30 items of 1 product a day x 1 month x their amount of stores x £1 an item only = nearly £900,000 a month. You based your example on just 1000 units but that can't relate to Argos, as I mentioned they have 673 stores in the UK, each with a catalogue so surely each of those stores must have sufficient stock of a single item in a month. Therefore my figures relate and I can't see the revelance of your 1000 units x £ 0.50 only, as I know that = £500! Are you just talking re a small retailer with a dozen or so outlets?

I understand about the exchange rate ..and if I only made £0.10 profit per product x £900,000 =£90,000 a month! Obviously if some-one factors stupidly low so that the margin is close to ever getting just that they'd be in big trouble...ie. to go into a loss!

....I know start small and work up ...but these are just initial questions....goal goals goals.....!

I'm going to look through your posts now ..to find the hidden info + Forex Trading company. Thanks.

[evolution9400]

To get the big boys, you are going to need something that no one else has got to offer