How to be approved Sony etc dealer

[Deep]

Hi guys

Can anybody help me with the following;

There seem to be official/approved dealers of branded home entertainment and so called 'grey' dealers. What exactly is the difference?

What are the potential discounts for buying in bulk ie if one bought 1000 ipods from Mac that Dixons sell at £160 what will they cost me?

Will guys like Sony/Mac/Philips etc sell directly to me or will I have to go through a middle man?

Many thanks,

Deep

[thepeoplespal]

I can nearly guarantee that you will run into all kinds of problems in trying to become a dealer and in trying to get your products.

Example: Levi jeans not wanting Tesco to sell their products (especially when they undercut traditional shops prices).

If all this was easy, everybody would do it, but don't let that put you off.

[Deep]

Thanks, can anybody elaborate a little on this?

[m-five]

Deep said:

Hi guys Can anybody help me with the following; There seem to be official/approved dealers of branded home entertainment and so called 'grey' dealers. What exactly is the difference? What are the potential discounts for buying in bulk ie if one bought 1000 ipods from Mac that Dixons sell at £160 what will they cost me? Will guys like Sony/Mac/Philips etc sell directly to me or will I have to go through a middle man? Many thanks, Deep

The profit on Apple products is tiny (about 5%) - a normal reseller get a £200 iPod for £190, if they buy in quantities of 100 or more, £195 if less than 50 units.

There are lawsuits in the US where it has been found that Apple sell to their own Apple-branded stores cheaper than to the resellers.

[thepeoplespal]

Sony counters illegal sale of PSPs in Britain [url]www.earthtimes.org/articles/show/3084.html[/url]
as an example of the kind of difficulty you can run into.

[simpo two]

I'm a small time reseller of AV stuff (luckily I do other things) and frankly now IMO it's simply not worth it. Sometimes I ask my suppliers for a trade price and it's more than I can find it for, retail, on the internet.

The internet is great for buyers, but it's wiped out most of the margin for dealers. Manufacturers are very unlikely to deal with you; distributors are already appointed. Grey imports are cheaper - fine if it's for your own use - but if you're reselling, you should make this clear. I ordered two plasma screens and only found out they were grey because one had a non-UK mains lead and the other was missing.

The other thing to bear in mind is the speed with which such things become obsolete. If you buy 1,000 i-Pods, setting you back £155,000, how many will you sell - at £5 profit each - before Mac launch an i-Pod 2 and you've got a garage full of stuff you have to flog off at a loss? And don't forget warranty claims and after-sales service too, which will come out of that £5 profit.

>> Edited by simpo two on Sunday 5th June 20:51

[Deep]

Thanks. Back to the drawing board then...

[steviebee]

Deep said:

Thanks. Back to the drawing board then...

Well, hang on a mo!

All the comments posted are very true but it is worth thinking about how you could benefit by selling other "related" stuff at the same time.

Take the iPod example. Dixons may only make a fiver on each one but then they provide cases, leads, accessories, all of which are likely to have a much higher mark up. (Plus of course the warranty commission when they manage to sell one!)

Quite often, it's the ancillary stuff where the real profit is to be found but you need the core product first. i.e. A mobile phone has little or no commercial value (and thus no profit) but the contract needed to operate it, does!

[martin hunt]

I would say go for it...

I run a website called www.footieshop.co.uk and most of my suppliers will only sell to me if I do not trade on Ebay?

which is fine by me, and you can get items from the wholesalers very cheaply priced. You do not tend to find legit wholesalers edvertising on the net, so ignore the www.iamawholesalersogetyourstuffoffofme.com type of links, they are not worth it.

Good Luck

[simpo two]

Yes, there's obviously a way to make it work, because people do - but do double-check your sums and cashflow. Be pessimistic - no point in imagining you'll sell X units a month to make your dream work on paper, if in reality you'll only sell half that and it all goes breasts-skyward.

Time to do some serious market research I think. And remember it's a very fast moving market out there. Good luck and remember us all when you buy Dixons

[Deep]

Thanks guys.
I take the points on ancillaries. I was in John Lewis and ipod cases were about £25 each. Looked like they could be made for about £2 in China!

As for cash flow/numbers sold I had a 'slightly' novel idea of making sure I had sold x items prior to x items being bought from a wholesaler/manafacturer. Hopefully x would be a large number ie 500+ to ensure some sort of discount. Early days, need to do more homework. Got to give up this day job though its killing me!!

Any further input welcomed

[martin hunt]

Another thing I have read and learned is:-

if you buy 100 items for £1 then plan to sell them at £2 then:-

You will sell 50 at £2, thus making your initial money back.

You will sell 30 at £1.50 this is now profit

And the last 20 at £0.50 again profit.

Simple numbers but a good way to build your business plan on.

Hope this helps?

<a href="www.footieshop.co.uk"><img src="www.footieshop.co.uk/logo.gif"></a>