Wholesaling Business

Blindside87

Hi All!

A bit reluctant to say what business I am in and not sure if it's that important.

I have been in the retail side of this particular business for 3 years. There are more and more places popping up in this market but I can only count 5 suppliers in the whole country who pretty much supply all these businesses. They are supplying them at what I consider to be an expensive rate (I import our stuff).

So what I am considering doing is setting up a wholesaler/supplier to other retailers. I can supply at a better price than the current suppliers and because there are so few existing suppliers in the country I think there is a lot of potential.

I suppose my question is where to start with it? I have contacted some retailers who are interested in seeing pricelists so I have emailed them that and plan to follow up on it soon. Is it just a case of cold calling retailers etc.

I am not familiar with wholesale selling so just looking for some advice!

Thanks (sorry for long post)

TheCostumeShop.ie: Ronan

Blindside87 wrote: »

Hi All!

A bit reluctant to say what business I am in and not sure if it's that important.

Erm, you have your business link in your signature. :rolleyes:

Just knock on doors, some retailers will see you as competition and a threat since if you see their volumes you might open in their area's so you need a response for this but other than that if you can sell a commodity, which is what your industry is, then price is really the only determining factor.

Blindside87

Thanks for the reply. I just realised that after I posted .

I have contacted a good few retailers with some interest but others just don't seem interested even though I know I am more competitive than where they are buying!

SeanSouth

I believe this is actually something that is widely misunderstood by lots of people about business.

There is no advantage to anybody (except you) in entering an industry, as a wholesaler, with lower prices.

Lower prices to the retailer will inevitably end up in lower prices to the consumer through competition. It will invariably mean lower margins to the retailer.

This is the "race to the bottom" mentality. For a retailer, lower prices are a bad thing especially if these lower prices are also available to their main competitors

So if you come today with lower prices, some other clown will feel obliged to come tomorrow with even lower prices and on and on until everyones business can no longer survive. There are loads of examples of this in our economy

By all means enter the business with better service, better quality or a better buying experience. Never go head to head on price. It will end in disaster.

Blindside87

Thanks for the reply.

I actually agree with a lot of your points.

Certainly in the recession I find a lot of markets are being ruined by people coming in and cutting the bottom out of it eg. A guy doing driving lessons for 20 euro when the standard is 30/35.

However just to clarify the situation here in this business.

The product is available at the same price I am doing them at in the UK, the difference is I can offer faster delivery and and overall better service, not to mention payment in euro's as against the sterling.

I am not trying to cut the bottom out of the market but matching pricing already available with a better service.

JD Dublin

SeanSouth wrote: »

I believe this is actually something that is widely misunderstood by lots of people about business.

There is no advantage to anybody (except you) in entering an industry, as a wholesaler, with lower prices.

Lower prices to the retailer will inevitably end up in lower prices to the consumer through competition. It will invariably mean lower margins to the retailer.

This is the "race to the bottom" mentality. For a retailer, lower prices are a bad thing especially if these lower prices are also available to their main competitors

So if you come today with lower prices, some other clown will feel obliged to come tomorrow with even lower prices and on and on until everyones business can no longer survive. There are loads of examples of this in our economy

By all means enter the business with better service, better quality or a better buying experience. Never go head to head on price. It will end in disaster.

Yes but without competition there is no progress. For example, we'd all be sitting looking at IBM cream the market, and we'd all be paying 5,000 for a PC.

hytrogen

Go for it, the Irish retail industry needs a cage rattling in a major way and they're all bricking themselves at the fact the golden ages of lashing €20 out for a deli lunch and forgetting the change are over so by all means get the competition rolling!