e-tailing

[chrisser]

Longtime BHM reader, but just discovered the forum.

Seems like this might be a place to gets some helpful pointers...

I have a modest idea for a web-based business. I don't want to go into too many details right now, but it would involve selling a subset of items found at drug/grocery stores that have particular qualities. They're things that can be found with some degree of searching, but not reliably, in my experience.

I have a pretty extensive web background (I'm a system administrator and manage web sites for a living as part of my job, and I do some better-than-basic web design). I also have some distribution background, but mostly industrial equipment.

Anyhow, I've done some preliminary research and the biggest issue I would need to overcome is sourcing my products. I think I could come close to breaking even by purchasing via discount stores or watching for sales and still price below online retailers like CVS, but in order to really be successful, I need to be able to purchase at something closer to wholesale.

Any advice on where to locate suppliers for products like these? I'm looking for name-brand products from companies like Gillette, P&G, etc. I find some of these products in small retail outlets, like convenience stores and gas stations, so I suspect there is some outlet that allows for small quantity purchases at a price that is below retail, but I haven't been able to figure out where and there seem to be a plethora of scams based on this area.

All advice appreciated...

[Southern_Gent]

I would suggest getting in touch with those companies whose products you're interested in selling. It may take a few phone calls, but you may eventually find some wholesale distributor that deals in several of your desired products.

[machinemaker]

I agree with Southern Gent, I build custom industrial equipment and when I need components I look online to the manufactures and find the area on their web pages for regional sales reps. I try to always go as close the the manufacture as possible to get the best price, but if I need service it helps to go further down the line to a local outlet sometimes. I would think that it would be the same for you. You have the advantage of the sales reps not knowing if you are a large retailer or small with your web based business and they would be wise to help you succeed so that they increase their sales along with you.
kent

[chrisser]

Thanks for the replies.

I did contact P&G via email, but I'll follow up with a phone call if I don't hear anything in the next day or two.

I need to establish a base of potential manufacturers and then work through that list to find suppliers. Hopefully some of the supliers will support multiple lines that I'm interested in.

Luckily for me, I already use a lot of the products I'm targetting personally. So I know the trials and tribulations of obtaining them as a consumer, and, worse case, I can absorb some degree of inventory overstock within my household.

[admin]

In or around most large cities you should be able to find distributors who deal in case lots. They are the people who usually supply non-chain stores. At least that is how it used to be when my father owned a small convenience store, but that was a good number of years back.

Your idea about watching for sales is a good one. I recall my dad hitting the chain grocery stores for certain items they were advertising for less per item than he could buy in case lots. Of course, in that venue, people expected to pay a premium for a can of tomatoes or a box of cereal for the "convenience" of not having to drive to the big store for one or two items.

One thought - will you still be able to beat online CVS, etc., once shipping is factored in? In that vein, the post office has fixed-price shipping boxes. $8.95 for 2-3 day delivery of up to 70 pounds anywhere in the USA. But you have to use their boxes, can't over-stuff them, and they only come in a few sizes, which might not work for your products. And the boxes are free!! You can find more info on the USPS website.

http://www.usps.com/shipping/flatrate.htm?from=priority&page=flatrate

Best of luck with your venture.


Oliver

[chrisser]

Thanks Oliver. I have thought about the shipping. I guess I'll have to see how it goes. My goal initially is to just see if there's a market, and not make a bunch of $$. If I don't have a huge amount of customers, then I have enough spare time between my wife and I to do this as a hobby and keep costs down as much as possible.

I don't like handling charges, so I would only pass along the exact shipping charges for the method the customer requests, leaving it up to them to weigh the cost against the speed and reliability of delivery.

That's not to say I don't want to make a profit, but I feel the best way to start off is to get the costs down as much as possible, and operate on the thinnest possible margin to start off. If it looks like demand is there, I can invest more in lower prices, more advertising, and slowly creep the margin up to what the market will bear.