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PROS AND CONS OF THE SURPLUS & SALVAGE SUPPLIERS By Robert Potter The "Pros" of the Surplus & Salvage merchandise is that they can offer you a variety of products at below wholesale prices. However you "market your merchandise," you should be able to find a product, or price, that will fit into any business advertising model. In most cases, you do not need a "Certificate Of Resale" to buy products from Surplus & Salvage Dealers and brokers.
The downside is that you have to do some investigative work. Some dealers will want you to buy merchandise in quantity (a pallet minimum, truckload preferred) and you have to visit the company you are buying from to make sure that the product is, as advertised. Also, more than a few S&S dealers want payment in the form of wire transfer which can be very risky. Also, dealers and brokers will sometimes misrepresent the quality of the merchandise they are are selling. Before you consider doing any business with a surplus dealer, or broker, you must read "The Ten Tenets Of The Retail Surplus And Salvage Business." It can be found here: The Ten Tenets Of The Retail Surplus And Salvage Business Drop-Shipping: Supposedly the perfect business model. No inventory, no trips to the post office or UPS. You just set up shop, take the order, pass it along to the wholesale drop-shipping company and they send it out for you. Some drop-ship distributors will even send you ad copy and pictures to help you advertise their products. They can even put your return address on the package! A lot of Retail Catalog companies use drop-shippers as their means of supply. PROS AND CONS OF DROP-SHIPPING: There is one obvious advantage to drop-shipping. It is basically a "product less" venture. No need to tie up your money in inventory. Drop-Shipping can fit into any business model, or advertising method you happen to use. However, if you are an Ebay Auction seller you might want to rethink that position.
Finding a drop-shipping company that can deliver on a consistent basis can be tough. Drop-Shipping companies have been known to run out of merchandise. If they happen to run out of the product you are auctioning, asking buyers to wait on their product because it is "backordered," does not inspire confidence. Your negative feedback rating can pile up real quick. The other problem is expense. Some drop-shippers require a sign-up, or "entry fee" before you even start marketing their products. You might also have to pay for support materials, such as pictures and advertisement brochures for the product you choose to sell. In addition, when you sell a product from a drop-shipping distributor there are processing fees that have to be paid, in order to get the product out the door and in the hands of your customer. That price can range anywhere from 5.00 to 10.00 dollars and up depending on the item. After Ebay and drop-shipping fees, you can wind up loosing money, or at best, breaking even. Bottom-line, drop-shipping and auction selling don't mix. The best bet for any auction venture is to "own what you sell." My last critique, and word of caution is about drop-shipping. You might have access to information about drop-shipping companies that would prove me wrong. I will not argue with anyone who is dealing with a dropshipping company who is serving them well. However, I will tell you that dropshipping is a risk. I really can't recommend any type of guide, or information that would lead you to a reliable source of drop-shipping companies.
Unlike surplus and wholesale, where you physically own and control the product, that option has been taken out of your hands. You are entrusting a company to ship products directly to your customers. If you get involved with a company who cannot deliver, or who is back ordered, you can find yourself with some very irate customers. Sign up fees, shipping fees, and expenses for support materials can really affect the bottom line. Also, most drop-shipping companies like to send out product in volume. If you are selling just a few items per week, or per month, it might not be worth if for a drop-shipping company to deal with you. Large retail catalog companies use drop-shipping or "fulfillment" houses, but these companies cater to large scale operations. The bottom line is this. When it comes to finding product supply for your business it pays to do your homework. Visit the company facility when you can. Never wire any money into a company account. Use a credit card, or Escrow service to protect yourself should your supplier not deliver, or send you defective merchandise. Understand that you will not be able to get the latest and greatest technology or fashions at surplus and below wholesale prices. If you follow all of these rules, and you use common sense as your "crusade" you just might be able to find your own "Holy Grail," of wholesale product supply! Robert C. Potter is a wholesale and retail surplus products specialist. He is the author of “The Ultimate Guide To Products For Resale!” Over 300 Wholesale & Surplus Supply Sources For Ebay Auction Sellers, E-Commerce Websites, Flea Market Vendors, and Retail Store Owners! You can find his 160 page ebook at: http://www.productsforresale.com |
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While all attempts have been made to verify the information provided in this website/ebook(s), neither the Author nor the Publisher assumes any responsibility for errors, omissions, or contrary interpretation of the subject matter herein. Any perceived slights of specific persons, peoples, or organizations is unintentional.This website/ebook is an information product, and is not intended for use as a source of legal, accounting, or tax advice. Information contained herein may be subject to varying national, state, and/or local laws or regulations. All users are advised to retain the services of competent professionals for legal, accounting, or tax advice.The purchaser or reader of this website/ebook(s) assumes responsibility for the use of these materials and information, including adherence to all applicable laws and regulations, federal, state, and local, governing professional licensing, business practices, advertising, and all other aspects of doing business in Canada and the United States or any other jurisdiction in theworld.No guarantees of income are made. The Publisher reserves the right to make changes. The Author and Publisher assume no responsibility or liability whatsoever on the behalf of any purchaser or reader of these materials. |
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Copyright 2005 Wholesale Electronics Info |
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