I have struggled with organization and planning in my reselling business, just like everyone else. In the early beginnings of my reselling adventure, I honestly had no idea how everything worked, nor did I think it was even possible to turn my collector lifestyle into a business.
I made many mistakes in those early days that cost me time and money. Mistakes I had never made nor dealt with in the past. I thought long and hard about why the mistakes and mix-ups never happened in my previous profession- working as a regional manager for a national restaurant chain.
The answer was very simple and had been looking at me straight in the face the whole time: any national business out there, including the ones I had worked for, had structured practices and procedures already in place for every aspect of all day-to-day, month-to-month, and yearly operations. Nothing was left to chance.
In my previous article, I discussed some of the basic business practices I use to avoid many of the pitfalls and perils that are inevitable in the reselling world. As your experience level and business grows, there are many other business practices that you can take advantage of that can help to advance your business.
Purchasing out of season is one of those concepts I have used for well over a decade. The whole idea of reselling is to buy low and then sell high. Buying out of season is a good way to accomplish that. Many items will cost you more money if you buy them in peak season, such as buying Christmas items right before Christmas.
If you are looking to get the best ROI (return on your investment), then buying anything when the costs are the highest is not a smart move. Buying holiday items just after the holiday has passed or long before it arrives will always give you the lowest investment costs.
Most long-time wholesale sellers, including myself, will buy Christmas items many months in advance to get the lowest cost possible. Just like with ordering supplies in bulk, you should also try to buy merchandise in bulk, as well. Especially when the costs are at their lowest.
This same philosophy also goes for selling your items. If an item is hot in the fourth quarter but dead in the second quarter, it is very obvious when you should be selling those items. When demand is high your items will sell for far more. Christmas lights, for an example, do sell well all year round, but will always sell for more around the fourth quarter due to the increased demand.
But, of course, not all items can or should be purchased in advance. In some cases, I may make a direct purchase on closeout, or discontinued items, out of the clear blue. Supplies, and not just merchandise, can be purchased this way also. If an opportunity arises that can either make me money or save me money, I will always jump on the opportunity whenever possible.
In many cases, if you are an established business, there are ways to avoid paying immediately for those sorts of purchases. A national business usually will have their bills due for purchases they made either in 30, 60 or 90 days from the date they placed their purchase order.
This means that many businesses can sell or benefit from items they have taken possession of, but have not yet paid for. I have found that I can take possession of inventory and, in some cases, sell enough to cover the entire purchase, prior to the bill ever coming due.
Having a bank account for your business is essential for this specific reason. Once you are established with your bank, most businesses can get a letter of guarantee that you can supply to the company you plan on purchasing from.
The letter of guarantee is a legally binding document which guarantees that if you cannot pay for the purchase that you make, then your bank will. This is the simplest way to basically get free merchandise to sell. You must choose your purchases wisely with this method, though, because if you can not pay for the purchase, and your bank is forced to cover the costs, they will never give you that option again.
But none of this is possible without your business having an EIN (employer identification number) number, which is something all brick-and-mortar and traditional businesses have. With an EIN number, you can get a business bank account, along with many other benefits that can help your business grow.
Many banks, including my own, offer free business bank accounts, which is another incentive. A business bank account can open up a lot of doors for resellers, just as they have for traditional businesses.
Reselling is a full-fledged business, and once you understand all the options available to your reselling business, the more opportunities you will have. And, of course, the more opportunities you have, the better you will do. The better you do – the more money you will make.
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September 12, 2021 at 04:03AM
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Online Selling as a Business: Sourcing and Financing Tips - EcommerceBytes
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