Revolutionary idea or reinventing the wheel?

So lately we have been getting a lot of drop shippers who ask us about wholesale. They realize that making 20 or 30% on a sale AFTER shipping only gives them a few dollars a listing/sale on smaller items. That is not to say that non durable goods don't have a higher return business rate and faster consumption bring their customer "back to the well".

So what we implemented for them was a "Low MOQ Flex" inventory option. We offer them 10,12,14,18 units of a products shipped in a flat rate box (paid by us) and sell it to them wholesale. This way they aren't sitting on a lot of inventory and every time they need more inventory its a small commitment with higher return. Instead of making 20% AFTER shipping they get 50% and fill their boxes themselves often for cheaper shipping rates. Their customers appreciate the faster turnaround time and getting their entire order in one box.

So tell me, is this a good idea? Is it new? Or did I accidentally stumble upon a tried and true method of supplying smaller outlets who don't want a lot of inventory?

Thanks!

Just to pitch in on this one, for members who want to take advantage of this, but still, don't have the capital to spend, consider teaming up with one or two others who are also interested.

Now there are a few tricks to networking on deals so I would suggest keeping the numbers in the group to a minimum to maximise profit sharing. You should also not make the silly mistake that many do, which is to each put in an equal share and then all take an equal share of products.

All that does is pit everyone in the network against each other and you all end up undercutting each other on eBay to try and get your cash back. If you are going to network to get in on the deal, then network to distribute the deal, that's the best way to do it.

For example, one person in the group is the distributor. They get the products delivered to them and they ship the orders. This keeps your shipping costs at a minimum across the board. Now you can choose to have everyone chip in the same and let the distributor chip in less due to the fact they are carrying the workload.

Alternatively, you can all chip in the same and then give them a greater return of the profit sharing for the workload and so on. Up to the group how you work out the finer details, but the moment you stop working as a group and start working as individuals, you can pretty much guarantee you will see your profits disappear in a puff of smoke because you lose the benefit of the group, the benefit of what got you into the deal to start with!

So there is an opportunity for members here, whether you do it as an individual or as a group, that choice is yours.

fudjj wrote:Just to pitch in on this one, for members who want to take advantage of this, but still, don't have the capital to spend, consider teaming up with one or two others who are also interested.

Now there are a few tricks to networking on deals so I would suggest keeping the numbers in the group to a minimum to maximise profit sharing. You should also not make the silly mistake that many do, which is to each put in an equal share and then all take an equal share of products.

All that does is pit everyone in the network against each other and you all end up undercutting each other on eBay to try and get your cash back. If you are going to network to get in on the deal, then network to distribute the deal, that's the best way to do it.

For example, one person in the group is the distributor. They get the products delivered to them and they ship the orders. This keeps your shipping costs at a minimum across the board. Now you can choose to have everyone chip in the same and let the distributor chip in less due to the fact they are carrying the workload.

Alternatively, you can all chip in the same and then give them a greater return of the profit sharing for the workload and so on. Up to the group how you work out the finer details, but the moment you stop working as a group and start working as individuals, you can pretty much guarantee you will see your profits disappear in a puff of smoke because you lose the benefit of the group, the benefit of what got you into the deal to start with!

So there is an opportunity for members here, whether you do it as an individual or as a group, that choice is yours.

Great insight!