The Wholesale Forums

[OJ*]

Hello all,

Only just found this forum and what a fantastic resource it is! I have recently decided to import an item from the States to supplement my business income.

It is a superb product and I have secured an exclusive distribution deal to the UK. I will be selling on my own website, but I also want to sell to retailers.

So, I have got samples, written and printed sales materials, boxed it all up, set up invoice forwarding with my bank, and suddenly realised that I don't have the foggiest idea how I should be asking for payment from prospective clients!

I'm starting with larger nationwide companies. Does anyone know how they operate? Will I need to invoice them once I have delivered the goods? Shall I give them an order form with the samples?

What would be your next step?

Many thanks in anticipation of your resposes,
OJ

[Pete]

I hope you have some deep pockets. Most major retailers are used to a minimum of 30 days net terms and more often 2% 30 days or better. Then they take 90 days to pay. Or, if your product hasn't done too well, they'll tell you to come get it and just pay for what is gone from the original order.

You've sort of put the cart before the horse.

And you'll find that getting the order is quite more involved than mailing a literature pack and an order form.

I honestly feel sorry for you. You have so much to learn, it's really just beginning and I don't know how much help you'll get on a forum.

I'd think if there were enough hours in the day greedyboy and I and a few others might cover some basics, but at this point I'd suggest finding a real live person to either partner with you or spend a few days with you, anyhow. Just getting to the correct buyer is sometimes a science.

You might consider an independent sales rep, familiar with your class of goods.

I hope I'm mis-reading this. But I get the feeling you are in over your head.

If anything, I'd start the other way around. Work the convenience stores, local retailers, etc., depending on the class of goods. Let them kick you around a bit until you learn the ropes. They will try to take advantage of you, ask for extended terms, maybe not pay, there's just so much that can happen.

I hate to talk this way. For your own sake, start small and local, find out what selling to retailers is really like. And be prepared for some lumps.
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[OJ*]

I accept I'm in too deep, but that is how I like it. It will be an educational project. Like I said, if it works out, it will be a supplement to my existing business, if not, it's no biggie, just another point on the giant life-long learning curve that is business.

However, that said, I could really use some advice on the original question. That is, please would you tell me (or point me to a resource) how I get potential clients to make an order with me.

In terms of collecting payment, my bank has offered me superb terms on invoice factoring, so that will be up to them, since they will have bought the invoices from me.

Thanks for your advice, Pete, and look I forward to speaking to you again.

[OJ*]

Oh, I should also say that my initial reason for importing the above item was that I couldn't get it anywhere in the UK, and I use it in my line of work.
I had to pick them up when I went to the states, which isn't often, so if I must pass it on to an independent sales rep, well, at least I'll be able to get them!

[Pete]

What are you selling? I'm not interest in the actual item, just what market you are looking to crack.

Hardware, housewares, etc. You go to different markets in different manners. Marks & Spencer? Farmers feed stores?


Factoring is great until the past dues begin, then they lose their interest. You still have to be certain the customer is going to pay in a timely manner.

It does help the cash flow, however.
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[OJ*]

Hi Pete,

The product sits squarely in the homewares department, but does have some industrial applications too.

It's the homeware retail market I'm aiming at. Sorry to be circumspect about the product -I feel like a bit of a pratt not naming it, but I'd rather not for the time being.

Could you explain a little more of what you mean by: "until the past dues begin, then they lose their interest"?

Thanks again,
OJ

[studio1one]

I wish you all the best my man, not my area of business so I'm not going to giv you advice, I hate people who pretends to know about stuff they don't. Just here to wish you success. I too am a firm believer in jumping in at the deep end and having to learn to swim pretty fast.

[Pete]

About the lose their interest first. Factors want to buy good "paper." If they start with you and the debts they buy become troublesome they will simply stop buying them from you. Most factors have a "no recourse" clause in their agreements, which means once they take the debt you no longer have to worry about it. This is good for you, but bad for them. So, if you go out and start selling to every tom, **** and harry with bad credit, they will simply cut you off.

No need to say any more about the product. Home wares is fine. It's a market I know nothing about, but it does suggest that you will be selling to everyone from Marks & Spencer to the local "mom & pop."

Department stores and chains have buyers whose major job is selecting what to offer for sale. Larger companies will have various buyers for specific departments. Just getting in the door to see a buyer can be a real excercise. For them I would say having a booth at a trade show would be a start. I doubt that anything through the mail would work.

Again, I'll mention sales rep. In the US there are independent folks and rep companies called "manufacturers' representatives". They work on a commission basis and sell a variety of product lines at the same time. Using housewares, they may represent a small appliance company, a dishware company, a window dressing company, a folding door company, etc. Seldom any directly competing lines, but there is some consolidation going one and that may no longer be as definite as it once was.

Again, not being familiar with that whole market, I'm sort of generalizing here. You are going to have several levels of sales efforts. First it the large stores and chains that will buy direct. Then you MAY have distributors, who buy by the case to by the truckload and break them down to single units which they sell to the smaller chains and mom and pops. And then you have the mom and pops and samller chains, which you could also sell directly, either in single units or in case packs.

From your standpoint, you are easier selling just the big guys and distirbutors and let the distributors handle the little guys, The distributors will have their own sales force, calling on the little guys. And if you use reps, the reps will sell the distributors and also do what they call "missionary work" by going out with the distributors salespeople and pushing your product.

The reps will also work with you at trade shows, incoroprating your product into a general display of their lines or by working with you at your booth.

Got all that? Now , you can do it all yourself, or find a rep organization and of course convince them that this item is the greatest thing since sliced bread and that they can actually not only sell it, but make some money on it. Make money on it is a big thing. A sales rep, out in the field has got to have enough commission for himself to make it worth his time to push your product. So, you've got to sell the rep organization they, and their reps, can make some money, not just waste their time.

Or, you can do it all yourself.

Keep in mind you will probably get no response from a mailing alone.

You will not get by the reception desk at Marks & Spencer.

You MAY get some response by placing some well written press releases in the trade press. Using trade mags with "bingo cards" where the buyer/owner can circle or enter a number and drop the card in the mail to the publisher, who will tell you that mom and pop are interested in your catalog will get some results. Not sales, but inquiries. And include a web address in the press release, of course.

You'll need some glossy sales literature. Something you've run off your Epson won't do much for the class you are looking for. Mom and pops might go with plain paper, but M&S won't.


According to what Mike says, there is all kinds of free help from the government. I'd suggest checking there, or if you have to, find an independent "product launch" person. It's going to take more than walking in a door with a business card and a sample to sell from the top down.

Now, if you want to distribute yourself< I'd start with the mom and pops and work up. You can walk into the local shops with your card, some samples and a price sheet and sell. Many take that route. It is the easiest to start with. It will give you a real feel for the market and give you some experience in that market. All markets have their own terms and ways of doing business. It helps to understand them and be able to "walk the walk and talk the talk" of the people you are trying to sell.

I'm out of words right now. I hope this is of some help and I'll go deeper if you'd like. There may be a bit of variation between the US and UK methods, but I think I'm pretty close.
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[anotheruser]

According to what Mike says, there is all kinds of free help from the government.

Not quite right. The government wastes billions, tens of them, on fancy buildings and salaries for failed bankers and accountants to point people in the "right direction" but those people have to pay for the help when they get there. if it was free help I'd welcome it. It is actually just another government led market distortion.

Apart from that, your post above describes the system in Britain and probably many other countries around the world as closely as it does North America.

From what he's said, OJ*s pretty well intending to go out there and make his own mistakes. So now he's got an outline of how it all works, and as you said in an earlier post, Pete, I'm not sure there's anything to add to this thread. Apart form Good Luck, OJ*!

[OJ*]

Many thanks for your kind and interesting responses.
As anotheruser says, I'm just going to get on with it and see what the response is.

I shall be sure to let you know how things pan out.

Regards, OJ