The Wholesale Forums

[kwidsin]

Didn't really know how to title this question, so bear with me...lol

I really don't know what the profit margin you serious traders class as good, but I'd like to know what sort of expense you would consider excessive to gain a certain profit. I'm not explaining this very well, so I'll give you an idea of what I mean.

I purchased 10 laptops @£250 a unit which obviously equates to £2500, which for a small amount of units seems a big outlay, and i'm only just starting, I sold them for £280 a unit, so initially approx £300 profit.

Now sitting here thinking about it, I'm just wondering if this was a wise action. I'm sure the same profit could be made with smaller goods at a fraction of the capital price, without laying out such a large amount of cash for such a small amount of units.

Would you tie up money in expensive goods for that sort of return, or would you be looking to make the same if not more profit than that, on a higher quantity cheaper product with less initial outlay. I hope that makes sense??, but I know what I'm trying to say....lol


thanks

kwidsin.

[Jazzy123]

Prfit margin wise that seems average/ok to start

depends on the turnover of te stock and if it depreciates

[DesignerAllsortz]

If I was you I would go with cheaper products your spending £250 on a laptop and making £30 profit I make that selling single units of sunglasses so same profit cheaper item to buy and you could buy more as they are cheaper than the laptops.

[jayjrc]

i make £22 quid profit for a 5 quid item, maybe look at resourcing or trying something else, but if it is the market you want to stay in maybe this is how it will go from now on?

[D M]

What you're referring to is return on investment.

£300 / £2500 = 12%

That's a slim margin. A faulty laptop or a chargeback (if you are accepting credit cards) is going to reduce that quite considerably.

[geosamm]

I dont know the product so cant comment of quality of mark up....
I can tell you that one of my wholesale customers had a "rule of thumb" when buying or selecting the items he purchased...
Buy at 10p... actual cost 20p... wholesale 50p.... retails for 100p
I doubt this will apply to electronics or electrical items and others

[E-ASYCHOICE]

All depends on how quickly you are turning the stock over and how much capital the stock is taking up.

Fow example;

You have spent £2500 on 10 units to make a profit of £300
If you spent that £2500 on laptop accessories, you would prob make 1500-2000 profit but you would hold the stock longer.

If you combined the two and sold package deals the higher % mark up on the accessories would make the final profit margin alot more pleasing, you would then also increase your repeat custom because people would return to you for a new laptop case/mouse/ect instead of only returning when they need a laptop.

Dont tie all your funds up in one product and use that one big item to sell multiple small items. That is where you'll make your money.

[kwidsin]

Thanks for the replies, much appreciated. Yeah, that was my general gut feeling......time to look elsewhere I thinks...

On some pressure washers I have, I'm selling at £57 with each unit costing me £37, so 54% profit......so I'm getting there slowly.


Some Great Information. Thank you


@jayjrc

Making £22 on a £5 item, bloody hell m8, fantastic. I would never have thought that possible, but I am an early learner

[Riggerz]

Jayjrc, What on earth are you selling and how?????

[jayjrc]

lol riggerz, i sell many things! obviously if i told you i would have to kill you! lol