Start-up business idea: importing and distributing lubricants and oils

Bonus_Pack

Hi everyone,

I recently had a brainwave of sorts regarding a potential small business idea and I was hoping that some of your may be able to offer some advice or suggestions on it.

Basically what I plan to do is import lubricating oils and hopefully, eventually down the line, become a distributor for a brand or two. I was thinking of say for starters selling lube to the likes of farms, hauliers and machinery operators and maybe getting into supplying some motor factors and the like. I have access to a small warehouse already so the logistics end of it should be relatively easy to sort out.
Now as regards the lube itself, obviously the big name brands are all tied up with the established main distributors. To this end I have been looking at some lubricant manufacturers in the UAE and a few in India too. The UAE lads seem to have better specifications, with the oils being mostly semi or fully sythetic and meeting manufacturers specs. So basically they hare high quality oils but there are no distributors for the brand here in Ireland or the UK. These would be targetted at the car market.
The Indian lads, on the other hand, as you might guess offer the more basic products like mineral multigrage and single grade oils and MP greases. I was thinking that these could be targeted at the agricultural and haulage machinery markets. (In particular I think basic Indian products would do well in the vintage/classic markets as these vehicles tend to give trouble when using modern oils with additives and they were designed to run on bog standard oils.)
In both UAE and Indian cases, the manufacturers I looked at had decent websites and the products looked well presented and professionally packaged. Both offer product in litre bottles, gallons, 200 L drums and 1000L IBCs (for supply to trade and large volume consumers).

As far as certification goes, both UAE and Indian manufacturers seem to meet various API and ISO standards, but i'm not too well up on those atm so more research is needed.

As an adjunct to the oils, I'd also be considereing importing greases, antifreezes, brake fluids and so forth so as to act as a one stop shop.

If you were to ask what would my business give to customers that the competition doesn't, well initially my niche would be to make business on the fact that I would deliver the product direct to the consumer, be it a farm or whatever. I think that would be an initial business maker. In addition I think the basic oils would proove popular in the vintage/classic markets.

Marketing - basically I'd be setting up a website, get leaflets and brochures printed and distributed and press hard on the motor factor trade to get product on shelves rather than having to do all the retailing myself. Inaddition I'd probably sing up as an exhibitor at trade shows and the likes of the Ploughing Championships and large vintage events just to get extra presence and exposure.

So thats the skeleton idea folks. Any advice or suggestions or any other feedback would be very much appreciated. I look forward to your replies !!!:):):)

Bonus_Pack

I've also been looking at a Russian supplier who's product has very good OEM approvals for european vehicles. The only thing is that the packaging has cyrillic text on it so i was wondering whether it's a big cost to get them to make product with all English labelling. Presumably if the orders were regular and not too small, labelling would not add massively to the cost.
I have e-mailled all these potential suppliers but so far none have yet replied.

Do foreign companies normally reply to business proposals from stnagers or is it a lottery? Would they view my e-mail like we would view e-mails from some randopm Nigerian company offering to do business? ie. do they just brush it off as spam mail?

Any advice appreciated

antoinolachtnai

So can you make any money doing this? Can you get the product in cheaper than the other players? Is this really a sustainable advantage?

How much will it cost you to acquire a customer?

Have you factored in all your costs for getting certifications and the like?

How are you going to manage the quality?

Who actually owns these companies you are buying from? Are they in any way tied to your prospective competitors?

Are there any duty/tax issues?

Why would the manufacturers give the distribution rights to you rather than to a big player?

Do you have the money to pay for a reasonable amount of stock?

Bonus_Pack

So can you make any money doing this? Can you get the product in cheaper than
the other players? Is this really a sustainable advantage?

That's what I am currently researching. If profitable why not?

How much will it cost you to acquire a customer?

To start out, it should be reasonable. A few huindred or1000-2000 max in expenses for getting orders i suppose.

Have you factored in all your costs for getting certifications and the
like?

this I am not up to speed on. What certifications are necessary in this case?

How are you going to manage the quality?

the only control I will have is to satisfy myselft that the products meet API or whatever specification and only purchase where these are met. Other that that, there is no other action I can take. I'm not getting into the testing game.

Who actually owns these companies you are buying from? Are they in any way
tied to your prospective competitors?

The Russian one I'm not sure about but the
ones in UAE and India, they seem to be unattached tot he likes of esso or texaco from what I can see anyway. I've been searching the company name with "+subsidiary" and things like that and no other established company names are coming up.

Are there any duty/tax issues?

. Excise seems to be for fuel oils only, not lubricating oils. Anti dumping tax might apply, it's not clear on revenue where is does and does not apply. VAT then, all the usual stuff.

Why would the manufacturers give the distribution rights to you rather than to a big player?

Well, no-one else is reselling their products in Ireland or the UK for that matter, I would have thought that they would rather someone reselling than no-one. Not looking for exclusive rights. Not yet.

Do you have the money to pay for a reasonable amount of stock?

Not at present, but I'm not exactly planning on buying a few container loads in the morning or next week. This is still in the brainstorm stage, not going to go into action in the immediate future.

Thanks for your feedback, these are things that need to be addressed to have proper thought out plan.:)

gambit83

i randomly came across this thread, how did you get on afterwards? a success story to share?

Axwell

The user is banned so you are unlikely to get an answer, also please dont dig up zombie threads from over 2 years ago..