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Drop Ship Articles

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What is Drop Shipping

Beware the "Free Gift"

Sell what's Selling - Not What's Hot

Misconceptions About Wholesale

Don't get Ripped off by Fake Distributors

How to Know What to Sell Online

Beware of Wholesale Agents

Market Research


"What Is Drop Shipping?"

To understand Drop Shipping, we should first understand product distribution.

People have been distributing products since before the first mastodon skinner traded a fur coat for a flint axe.

Here’s how it works.

Let’s say ABC Manufacturers makes a product called Mom’s Ankle Wax. We’ll say that Mom’s Ankle Wax has been around for years. It’s a very well known brand name product. It will without a doubt give you the shiniest ankles on your block, and everybody wants some.

ABC Manufacturers makes Mom’s Ankle Wax, but they don’t sell it directly to the public. They’re a manufacturing operation. They’re far too busy melting paraffin and waxing test ankles to go around building stores all over the place. They need distributors; companies who will take their product and distribute it to the places that will sell it.

For years, ABC Manufacturers has sold Mom’s Ankle Wax to a company called DEF Distributors. The founder of DEF Distributors knew Mom herself, back in the old days when she made her Ankle Wax by hand, out in the turkey barn.

Today, DEF Distributors buys Mom’s Ankle Wax by the truckload. They pay $5.00 a case for it, which is a very good price. It’s such a good price, it has it’s own name: the Manufacturer’s Wholesale Price.

However, DEF Distributors does not sell it to the general public either. They are a distributor. They distribute Mom’s Ankle Wax.

DEF Distributors works with a chain of retail stores called Wax R Us. This place was founded by a retail business visionary who saw the incredible potential of Mom’s Ankle Wax a long time ago. Today there are Wax R Us retail stores on every street corner in every major city in the country. Wax R Us buys truckloads of Mom’s Ankle Wax from DEF Distributors for $10.00 a case.

So, DEF Distributors makes $5.00 on every case of Mom’s Ankle Wax they sell to Wax R Us retail stores. This makes DEF Distributors very happy.

Cases and cases of Mom’s Ankle Wax arrive in the stockrooms of Wax R Us stores everywhere. The Wax R Us employees open those cases, and pull 12 cans of Mom’s Ankle Wax out of each case. With their pricing guns, they stick a price of $4.50 on each and every can.

Wax R Us stores make a total of $44.00 on each case of Mom’s Ankle Wax. (12 cans x 4.50 per can = 54.00, minus the 10.00 they paid for the case = 44.00).

Wax R Us is even happier than DEF Distributors.

However, the happiest people of all are the people who can stroll into Wax R Us and purchase a can of Mom’s Ankle Wax for only $4.50. They think this is a great price, and they’re walking around with the shiniest ankles in town.

Well, that’s it…basic product distribution. The manufacturer sells to the distributor, the distributor sells to the retailer, and the retailer sells to the end user (the customer). The manufacturer, the distributor and the retailer all make money because the customer is willing to spend money for the product.

Drop Shipping has been around for a long time, too. Probably as long as mail order catalogs; maybe longer. If you want to use a buzzword to impress a corporate type, call it “second party addressing”.

Above, we talked about the manufacturer-distributor-retailer relationship. When you use drop shipping to sell products on the Internet, (or anywhere else), YOU become the RETAILER in that relationship.

It should be noted here, if only to keep the Punctuation Police happy, that if you use the method of drop shipping in your business, YOU are not the “drop shipper”. The company(s) who supply the products to your customers for you is the drop shipper. YOU become a “Stockless Retailer”.

Here’s how drop shipping works.

1.)   You open an Internet Store, with a shopping cart and the ability to accept credit cards.

2.)   You find a distributor who is willing to drop ship the products you want to sell. The best place on the Internet for this is WorldWide Brands.  This website, the Drop Ship Source Directory and Light Bulk Wholesale Directory are recognized as the best sources for legitimate Wholesale Suppliers on the Internet.

3.)   You establish an account as a retailer with the Wholesale Supplier you choose.

4.)   You receive images and descriptions of the products you want to sell from the Wholesale Supplier and post them on your Internet Store.

5.)   A customer surfs into your Internet Store, and falls in love with a product that you have priced at, say, $80. They purchase the item with their credit card. Your Store charges their credit card $80 plus your shipping fee.

6.)   You turn around and email the order to your Wholesale Supplier, along with the customer’s name and address.

7.)   The Wholesale Supplier sends the product directly to your customer, with YOUR Store’s name on the package.

8.)   The Wholesale Supplier charges you the wholesale price of, say, $45.00, plus shipping.

9.)   Your customer gets a cool product from your store shipped to their door, and they tell all their friends about you, and you make even more money.

There you have it. You just made a $35.00 profit on one item. You didn’t have to buy a whole bunch of the product and keep it in your warehouse, hoping you would sell it. You didn’t have to pay to have it shipped to you, and then pay to ship it to your customer. All you did was send an email to your Wholesale Supplier.

That’s the drop shipping process in a nutshell!

 

Chris Malta

Worldwide Brands, Inc.

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"Beware of Drop Ship Web Sites Bearing 'Free Gifts'"

If they're offered after the sale, they're NOT free!

One of my best friends, someone that I’ve known since I was a teenager (which seems like a long time ago!), had a great collection of T-Shirts with some of the funniest slogans on them that I’ve ever seen.

One of my favorites was his T-Shirt that read: “If You Can’t Dazzle ‘em with Brilliance, Baffle ‘em with Bull****” (You can probably fill in the blanks quite easily!) 

There are a tremendous number of web sites selling Information on the Internet who are doing just that. Completely lacking in anything even remotely resembling brilliance, they are spending a great deal of effort, and seriously taxing their few active brain cells, in order to Baffle you into buying sub-standard Information Products. 

We are in the business of providing Product Sourcing information to Home-based Internet Businesses. We publish The Drop Ship Source Directory, a Directory of brand name Wholesale Supplier who are willing to Drop Ship those products directly to your customer from the warehouse, one at a time, at wholesale. It’s an excellent way to do business without spending a ton of money on stocking an inventory. We also publish The Light Bulk Wholesale Directory; a Directory of genuine Wholesale Suppliers who are willing to sell small bulk quantities of products to Home-based Internet Businesses at larger bulk quantity wholesale prices. We’ve worked very hard for years to provide absolutely honest and complete information. 

However, there are other information providers in this business who are either too lazy to do the time-consuming research this business requires, or are just outright scam artists looking to cheat you out of your money. 

They have a wide range of methods they use to Baffle you into buying from them, but one of the most obvious is Free Gifts.

 Now, we have to be careful here, because there are two kinds of Free Gifts. 

1.)     Free Gifts given to you before the sale are usually a good thing. We do that ourselves; we offer a very comprehensive Free EBook that gives you a tremendous amount of FREE information on starting your Internet Business. We give you that for free, no questions asked, no personal information required, and you never have to buy anything from us. THAT kind of Free Gift is OK, because it really is Free!

2.)     Free Gifts that are promised after the sale are the thing to watch out for. They are designed to make the offer look so attractive to you that you simply cannot turn it down. They are, in fact, given to you because the main informational product itself is so lousy that it’s creators feel that they have to suck you in with after-the-sale freebies, or they’ll never sell anything to you at all. However, in order to get all these Free Gifts, you have to buy something first.

Here’s how these scam artists work:

They pitch their junk Informational Product to you with all kinds of wonderful promises, telling you that you’re going to make incredible amounts of money very quickly.

That in itself is not true! NOBODY makes incredible amounts of money quickly on the Internet. In the real world, it takes time, patience, and work!

THEN they tell you that if you order their information, they will include “$750 Worth of Bonus Free Gifts!” with your order, or some such ridiculous statement. They tell you that you will get Marketing Information, Email Generation Software, Important Articles and Reports, Expensive EBooks, Bonus Wholesale Guides, etc., etc., for FREE, after you buy their product.

Freebies that you only get AFTER the sale are there for two reasons:

  • They make you think you're getting much more that you are paying for, when in truth you are not; you can pick up that stuff for free without buying anything. All that Free Stuff is just that; it’s FREE, it’s garbage, and you can find it all over the Internet for nothing, without having to pay a cent for anybody’s products. The scam artists certainly do not pay for it; why should you?

  • They are a distraction. The scam artists are counting on the very good probability that you will spend so much time with, and get so caught up in all that extra free stuff that you will forget that the original product you paid for is junk, and you'll never bother to ask for a refund!

So Beware of Informational Web Sites offering Free Gifts after the sale, folks. There is a reason for it, and it’s not a good one!

Maybe they should also offer a T-Shirt with those “gifts”…I know a guy who can suggest a good one…

 

Chris Malta

WorldWide Brands, Inc.

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Drop Shipping: "Sell what Sells, NOT what's Cool"

Our company publishes the Internet’s leading Directory of genuine wholesale “Drop Shippers” (wholesalers who ship products, one at a time, directly to your customers; eliminating the need to stock inventory). It's called The Drop Ship Source Directory. We also publish the Internet's Leading Directory of genuine Wholesale Suppliers who will sell to you in small Bulk Quantities, while still giving you larger Bulk Quantity prices. That's called The Light Bulk Wholesale Directory. As a result of the information we research and publish, we get questions all the time about what products Home-based Internet Business owners should try to sell online.

I’ve been at this for years, and have become very successful in my Internet business. But let’s face it, folks. If I knew what was going to sell well on the Internet tomorrow, next week, or next month, I wouldn’t be writing this article. I would have retired and purchased a small private island by now. In the retail business, whether you are online, in a physical store in the local mall, or at a roadside stand, it makes no difference; choosing the products you are going to sell is always the hardest part of getting started.

I can’t whip out a crystal ball and tell you what to sell. However, I can tell you about the biggest mistakes that I see new Home-based Internet businesspersons making, all the time.

Too many people are fixated on four things:

  • Selling only products they like.

  • Selling only products they know a lot about.

  • Selling only products they think are “Cool” or “Sexy”.

  • Selling only products they think “The Hottest Products on the Internet”.

I get four basic emails from people who are stuck in this rut, and I can pretty much tell that right off the bat, by the way the email begins.

  • An Email from a person who only thinks they can sell what they like starts something like this:

 “Dude, I’m like, a Sk8ter, and I need to find a Wholesale Supplier for, like, Sk8tboards + wheels + stuff”. 

The first problem this person is going to run into (aside from the fact that he needs to learn how to write a business email!) is a problem for all four types of people here. There may not be a Wholesale Supplier for the products they want, that will work with a Home-based Internet Business. We’ll talk more about that in a few minutes, though.

The second problem is “tunnel vision”. This person may actually find a Wholesale Supplier for “sk8tboards + wheels + stuff”. If he does, great. However, someone who has such a narrow vision of the Internet Marketplace will never branch out and fulfill his own potential in that Marketplace.

Say he does find the Wholesale Supplier he’s looking for, and opens a store. Because of the narrow vision that led him there, he’s likely to stick with that store, and that store alone. He’ll make some money, but unless he gets really lucky, he won’t make a really good income out of it. He’ll piddle along selling “sk8tboard” stuff forever, when he could have done so much more.

What he needs to do is broaden his scope. If he’s interested in “sk8ting”, wonderful. But instead of focusing on just that, he should explore selling all kinds of sporting goods.

Sam Walton, the revered Founder of Wal-Mart, was once a starting quarterback on his High School football team in Columbia, Missouri. He also liked to play basketball. Can you imagine what would have happened if Sam Walton never tried to sell anything besides football and basketball equipment? There would probably be a pretty big store in the US selling just footballs and basketballs today, because Walton was a very good retailer. But it never would have grown to the size and scope of Wal-Mart today if Sam had allowed tunnel vision to crowd his overall view.

It’s okay for our “sk8ter” buddy here to open an Internet store or run Auctions that sell skateboard equipment. Niche marketing is a good thing. But in his overall business, he should look for other products with which to eventually run other Online Stores or Auctions as well. One store leads to two, two lead to four, and so on. Never get stuck limiting your entire business to just one type of product!

  • An Email from a person who only thinks they can sell what they know about goes like this:

“Hey there;

I’ve been riding horses all my life, and I own a small stable where I teach riding. I’m opening an Internet Store where I’m going to sell all kinds of stuff that other riders will want to buy. I’ve got to find a Wholesale Supplier for saddles and Western Wear and such”.

 Again, this person’s first problem is going to be that he may not find a Wholesale Supplier of the products he knows so well, that's willing to work with Home-based Internet Businesses. But, we’ll get to that in a bit.

His second problem is similar to the first person’s problem, but not exactly the same. This person isn’t fixated on selling only what he likes; he’s just a little bit scared of having to learn about something new. He’s obviously going where he feels safe.  That’s okay, but let’s remember what I’ve mentioned twice so far: he may not find a Wholesale Supplier for the products he likes. Genuine Wholesale Supplier do not grow on trees, folks, and most of those who are out there do not want to work with Home-based Businesses. There isn’t one available to you for every possible type of product. It’s very important to keep that in mind when you start out!

So, what does this person need to do? He needs to understand that being in business is about learning new things every day. New ways to market, new software to get used to, simpler ways to do his monthly books, etc., etc., etc. Learning new products is just as critical. Again, never limit your business to just one type of product.  You don’t have to like what you sell. You just need to make money selling it!

  • An Email from a person who only thinks they can sell what’s “Cool” goes like this:

“Hi;

I’m looking for a Wholesale Supplier of electronics, like MP3 Players, Plasma TVs and such. Please tell me where to find them.”

A request for Wholesale Supplier of electronics is a dead giveaway. Almost everybody who starts a Home-based Internet Business wants to sell electronics at first. It’s the Cool, Sexy market, and even if you never sell anything, you can show your friends your site and say, ‘Dude, I can get you an Xlent deal on the hottest new stuff!

Electronics, like any other Cool or Sexy market on the Internet, is not the place for most people to start. That market is absolutely flooded with other people who already had the same idea, and the profit margins have plummeted. Why? Too many inexperienced Internet sellers. They start price wars, figuring they’re going to clean up by undercutting everyone else’s prices by a little bit. Problem is, the second guy comes along and undercuts the first one a bit. Then the third person comes along and undercuts the second. And so on.

Pretty soon all you have left are tens of thousands of people trying to sell electronics for pennies more than what they pay for them, just to advertise a slightly better price than their competition.

Not good.

The person who wants to sell Cool and Sexy stuff needs to understand that they are not out here to look Cool or Sexy. They’re here to make money. Four Slice Toasters and Propane Camp Stoves aren’t sexy, but they sell and their markets are not overcrowded, and that’s what the goal is. 

  • Finally, an email from a person who thinks they need to sell only the Hottest Products on the Internet goes like this:

  “Hello;

Can you tell me were I can find out what the Top Selling Products on eBay are? I want to know what everyone else is selling and get in on it.”

BAD IDEA!

Look at it this way. If you were in a giant field filled with nothing but concession stands selling Salted Peanuts, what’s the smartest thing you could do? Set up yet another Salted Peanuts stand, or set up a Lemonade Stand?

I’d sell Lemonade, wouldn’t you? :o)

In our business, we look at the Lists of Top Selling Products on the Internet, too. Then we run the other way as fast as we can. We don’t want to be just another face in the crowd selling the same thing as everyone else. We want to think about products that may be complementary to the Hottest Sellers, that not many other people are selling.

If everyone and their Grandmothers are selling Salted Peanuts, we want to be the ones selling Lemonade. :o)

Chris Malta

Founder/CEO

WorldWide Brands, Inc.

[ Top ]


 

"The Wholesale Misconception"

One thing that’s constantly misunderstood by people trying to run a home business on the Internet is the word “Wholesale”.

Some people think that working with a real Wholesale Supplier means that they will magically be able to sell products for less than anybody else on the planet, for ever and ever. They’ll be the only one who ever gets such good prices, and they’ll earn millions because no competition can touch them. They’re retire happily in a couple of months, and buy a big house in Beverly Hills, complete with a butler, a private chef, and a little satin doggie bed in every room for the casual use of the family Basset Hound, Duke.

 Then they find that they may actually have to compete with companies who have more buying power and get better price breaks, and suddenly the honeymoon is over. They run around screaming that the supplier is not a real Wholesale Supplier, and is cheating them. The sky is falling, and it’s time to get Duke to the storm cellar because all their dreams are being blown away by bad, BAD people who claimed to be Wholesale Supplier, and really are NOT!

 The truth is that they’ve simply been confronted with a perfectly normal aspect of retail sales that they had not anticipated, and need to be educated about.

 Even when using genuine Wholesale Supplier, you're going to find some stores selling products at a "retail" price that is lower than your Suppliers’ "wholesale" price. There are VERY good reasons why you'll see this happen, and it's extremely important to understand why it happens and what to do about it in order to sell successfully on the Internet or anywhere else.

 As I said, it happens for a variety of reasons; the most common of which is that the retailer with the "lower than wholesale" price is a large retail operation that bought THOUSANDS of the product at a dirt-cheap quantity price break, and also qualified for huge manufacturer's wholesaler rebates. You can't compete against that with a home business; no one can.

 The term "wholesale" is relative, no matter who your distributor is or how you find them. What you're getting as a small business is a Wholesale Supplier's genuine "first level" wholesale price.

 For example, one factory-direct Wholesale Supplier we work with has an initial wholesale price for 1 to 36 dart boards. Then the second price level is reached, and there's a lower price for 36 to 72 boards, for example, then a lower price for the next higher quantity level, etc. When dealing with single item orders in your home business, you are obviously going to be getting the "first level" wholesale price.


 Again, wholesale is a relative term. Yes, genuine
Wholesale Supplier DO sell at significant discounts below Manufacturer's Suggested Retail Price. However, you have to watch what you sell. Electronics, for example, are a very tough market, because EVERYBODY is trying to sell electronics on the 'Net right now. All these people are so busy trying to undercut each other that they have driven the "market price" of these items down so low as to make it very difficult to make a profit, even at wholesale.

 For example, if the Manufacturer's Suggested Retail Price (MSRP) for a VCR is $149, and it is available at "wholesale" for $69.00, that's a 54% discount off MSRP. That's a pretty good profit, right? However, with everybody getting roughly the same price break, there are a lot of people out there who are ruining the market for everyone else by selling that product for, say, $79, thinking they will undercut everyone else and make money by selling volume. Pretty soon, everyone else sees this, and tries the same thing. Eventually, the Internet "market price" for this VCR BECOMES $79, and everyone is flooding the market with it at that price. That's only a 13% percent profit margin, and that product is no longer worth the effort for anybody.

 So, even though the product IS available initially at a great wholesale price, its market value is ruined by those who (wrongly) assume that the only way to sell is to have the absolute lowest price anywhere.

 Sales is much more of an art than that. If selling something were simply a matter of the absolute lowest prices, Wal-Mart would be the only store on the face of the Earth.

 Without going into too much detail, sales is a mixture of choosing the right product, or combination of products, for your web site. It's presenting a clean, attractive, focused site. It's giving the customer some little value-added bonus at your site. It's providing the absolute best customer service that you can. All these things help a customer to trust you, and when they trust you they are willing to spend a little more to buy from you.

 One of our retail sites is www.ElectronicDartShop.com. We sell Arachnid Electronic Dart Boards there. We sell ONLY those products on that site; just 14 of them. Our site is clean and attractive. We have a page listing all the rules for all the dart games that can be played on those boards. We pay very careful attention to customer service. And guess what? We are NOT the lowest priced store for those dart boards, by any means. Yet we are one of the highest-volume Internet dealers of the products around, according to the factory. Why? Our customers trust us, and are willing to pay a little more because they feel they will get more value from us than they will from some guy who just throws up a cheap-looking site full of all kinds of unrelated products and only pays attention to price-cutting.

 In fact, a few days ago, I went online and bought a couple of SmartMedia memory cards for my digital camera. I could have gotten them for a very cheap price that I found on the 'Net, but I chose to pay $5 more each for them because the cut-rate site looked cheesy, and I was not sure I could trust them. I was more than happy to pay the extra ten bucks total when I found the same products at a higher priced site. The site was well-built, easy to navigate, and went out of it's way to explain it's customer service policies to me. I'd rather spend an extra ten bucks and be confident that the cards would show up at my door than lose thirty bucks plus shipping to a site I didn't feel I could trust.

 As a small business owner, you should remember to choose comparison areas very carefully. Too many people simply go to the big search engines and look for the absolute lowest price on earth, and then give up on selling that item if they can't beat it. That's the wrong approach, as I've mentioned above. You need to be comparing prices against sites that will be seen in the same places that your site will be seen, and even if your prices are higher, you can bring in sales by building a clean, focused site. Alternatively, you can simply sell the models that others are NOT selling. After you begin to earn some profit, you can then start to buy and stock the better sellers in quantity, lowering your price, if you really want to.

 Even then, you're going to run into stores that stock a lot of merchandise, and are getting price breaks on greater quantities. This allows them to sell at a lower price.

 Go around them. Sell models that they don't, from the same brand names. You don’t have to purposely go head-to-head with the big superstores. They don’t carry every product ever made on earth. Sell something in the same general brand and product lines that they DON’T have the shelf space for!

 Besides the reasons mentioned above, there are also too many people who buy entire pallet loads of last year's closeouts, liquidations, and refurbished goods, and claim that they are NEW. They get that junk at "rock bottom" prices, and of course, sell them dirt-cheap, fooling the customer (and other Internet retailers) into thinking that they have the corner on the best wholesale prices around, when they DON'T.

 The important thing is to work effectively within the framework of available products and prices, and work around those who have millions of dollars available to stock inventory. That's what THEY did in order to EARN those millions in the first place. You can do it too. I know it's frustrating to be just starting out, and thinking that you can't succeed because of competition from large stores. That's just not true. We're succeeding at it, and so are thousands of others. You just have to be willing to be flexible, and to make serious decisions for the good of your business. You may have to give up selling certain products that you personally like, in order to make money on other products whether you like them or not. You’re in business to make money, not to satisfy your personal taste.

 One thing I tell people all the time is that it’s very important to “jump through the hoops” and form a LEGAL business. It’s the right thing to do, and it’s the ONLY way to work with GENUINE wholesale suppliers.

 However, anyone in business will tell you that the hoops never end; not for home businesses, and not for big businesses either. Even the big guys spend much of their time "hoop-jumping" in order to be successful.

 Imagine how the purchasing agents at CompUSA feel when they spend a million dollars on 19" monitors so they can sell them for $329, and a week later, they find that Best Buy spent three million buying up the same monitor at a better price break, and is now advertising them for $298. Suddenly CompUSA can't compete.

 Should they throw a tantrum, and berate the Wholesale Supplier for simply performing the normal function of a Wholesale Supplier?

 Of course not. They can simply stop advertising that monitor by itself, and bundle it with an entire computer system that has it's own serious price breaks, and move the monitors that way. Adapt and improvise.

 There are no magic bullets, even though there are plenty of people who will tell you that there ARE. Don’t believe them! When you’re in business you will always have to compete. It's all part of sales, on the Internet or anywhere else.

 

Chris Malta

WorldWide Brands, Inc.

[ Top ]


 

"Don't Get Taken by a Fake Drop Ship Supplier!"

If you want to start your Home-based Internet Business for very little money, you need Wholesale Suppliers who Drop Ship.

Why? Because working with drop shippers eliminates the need for you to carry expensive inventories. You don’t have to rent a warehouse, hire employees, establish accounts with UPS and FedEx, etc. You can sell the best brand names on earth from your home computer, and make good money at it.

Wholesale Suppliers who drop ship send the products you sell directly from their warehouse to your customer, with your business name on it. All you do it take the order from your customer and pass it to the distributor. You keep the difference between the wholesale price the distributor charges you, and the retail price you sell to your customer for.

Of course, there are a lot of places out there that want you to THINK they are wholesale drop shippers. They’ll set up accounts with, say, 10 real drop ship suppliers. Then they’ll call themselves something like “GetYerStuffHere.com”, and claim that THEY are the wholesale drop ship supplier. Then it’ll go like this:

  1. GetYerStuffHere.com will place advertising all over the Internet proclaiming to be the greatest source that ever existed for all kinds of great products, and they’ll drop ship all those products to your customer.

  1. You’ll get all excited because YOU can actually place everything from Sony electronics to Coleman Camping gear on your web site and sell it.

  1. GetYerStuffHere.com will charge you an account setup fee, to cover their “processing”. (Note: REAL Wholesale Suppliers almost NEVER charge you an account setup fee).

  1. GetYerStuffHere.com will send you a nice, shiny list of products and show you where to get the product images and descriptions to place on your web site.

  1. You’ll get all excited, and put all this great stuff on your site, set your prices so that you can make a profit over what GetYerStuffHere.com.

  1. You’ll launch your site, and you hardly sell a thing.

 Huh? What happened? Nobody’s buying! You can’t survive on just a few orders a month!

Disappointed and discouraged, you start to go out and check other web sites that carry the same products. Maybe they have better images. Maybe they have cooler descriptions. Maybe their pages look nicer. You find that it’s none of those things. So what DO you find?

The other sites’ PRICES are lower. A LOT lower.

You just got nailed by one of the most popular scams on the Internet.

GetYerStuffHere.com took you for a couple of hundred dollars in exchange for a CD full of product images. They may have even locked you into a contract where you have to pay them every month to be a “member” of their “distributorship”.

Oh, GetYerStuffHere.com DOES ship the products they claim to. Of course they do. It’s just that when they get an order from you, they turn around and place your order with the REAL Wholesale Supplier, and take a profit. By the time YOUR price is calculated, you’re paying not only wholesale, you’re paying GetYerStuffHere.com’s extra markup of anywhere from 10% to 30%.

In order for YOU to make a profit, you naturally have to mark up the prices you get from GetYerStuffHere.com. By the time you do that, you can’t compete on the ‘Net. Your prices are just too high.

At this point, you can do one of two things:

  1. You can lower your prices to the point where you’re making mere pennies on your products in order to compete.

  1. You can bypass these jokers and go to the REAL sources.

 I’ve been in Systems Engineering for 19 years. I’ve been involved in ECommerce since it began. In that time, I’ve seen this scenario played out over and over with companies I’ve done work for.

The real sources can be hard to find. They don’t market themselves as Internet Wholesale Supplier. They are established wholesale companies who have been supplying big chains like Sears and Kmart for a very long time.

Many of them are now realizing that a good part of their future lies in Internet sales, and they are establishing drop ship and light bulk wholesale programs. There are even a few big name manufacturers who are beginning to supply Home-based Internet Businesses right from their factories. That’s where YOU need to be. In direct contact with the actual Wholesale Supplier or factory source.

When you’re looking for a drop shipper, here are a couple of things to be careful of:

  1. Any company that tells you that they’ll set up your entire web site AND PROVIDE THE PRODUCTS FOR YOU will NOT make you rich. They’ll make THEMSELVES rich on your setup and hosting fees, and you’ll piddle along with thousands of other small sites all selling exactly the same things at the same prices.

 (NOTE: Don’t confuse this with companies who just offer to set up your ECommerce web site. There are a lot of great places out there that will build and host sites for you. It’s when they tell you that you HAVE to sell the products that THEY provide that you should run for cover.)

  1. Any distributor who wants you to pay a “membership” or “setup” fee is probably not a true Wholesale Supplier.

  1. If it sounds too good to be true, it’s too good to be true.

 

Chris Malta

WorldWide Brands, Inc.

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Drop Ship & Wholesale: "What Should I Sell Online?

We've just finished several months of development on a new software product here at Worldwide Brands, Inc., and it's now available to you as a FREE TRIAL. I'm very anxious to tell you about it; I'm sure you'll be as excited about it as we are. :o)

First, though, I'd like to tell you why we spent all that time and energy, working with many very successful ECommerce experts, to develop this new software.

For years now, through all the time I've been working in and writing about ECommerce, I've always come across one single question far more often than any other. It's a question everybody has, and nobody seems to be able to answer easily. What's the question?

"What should I sell on the Internet?"

People email us and ask us that all the time. People call us and ask us where they can find out how to make that decision. I myself have struggled with it many times. Lots of people know what products they want to sell Online. Nobody really knows ahead of time if those products stand a chance of making you money.

If you really want to know the answer to that question, your only choice is research, and lots of it. Based on years of experience, here's the basic process that we and many other successful Online Retailers would go through every time we try to decide on a new product to sell on the Internet.

  • Find out what the Demand for the product is:

If I'm going to be a food vendor at a baseball game, what should I sell there? I may really like salted peanuts. Maybe I get up every morning and eat salted peanuts for breakfast, and drink a salted peanut flavor Power Drink. Than I have a salted peanut sandwich for lunch, and two processed salted peanut patties on a bun for dinner. So, I really love salted peanuts, know a lot about them, and think they're the greatest thing in the world.

Does that mean that I should sell salted peanuts at that baseball game? Well, it's something that I know people like to eat at baseball games. I know people do buy them at baseball games. However, there are things I don't know yet.

For example, how many people at that particular game are likely to want to buy salted peanuts?

Generally, salted peanuts are a good bet to sell at a baseball game. However, I may not know the area very well. If I'm a traveling food vendor, following sports seasons through the country in different states and different kinds of weather, salted peanuts may not always be a good idea.

Salted peanuts are pretty good when they're fresh and slightly oily. During the summer, people just eat them up left and right at baseball games. During cold weather, though, they tend to get more dry and crunchy, and the salt doesn't stick to them very well because the oil gets hard. If it's cold enough, eating salted peanuts outside can be a bit like chewing gravel. Yech!

Weather isn't the only problem. If it turns out that the game I'm going to sell at is a special event to raise money for the Worldwide Allergy Sufferer's Foundation, I will probably find that many people there might have an allergy to peanuts of any kind! That means that there is a much lower demand for my product than I'd like.

So, where is the game I'm going to be selling at? Is it a cold-weather game? Who's sponsoring it? Are there likely to be many people there who can't eat salted peanuts?

These same ideas, silly as some of them might sound, apply to Internet Sales as well. After all, the Internet is just another place to sell products. The basic concept of Demand is the same there as it is anywhere else, and has been for all time. If there aren't enough people who want it, there's no profit in selling it!

When we at Worldwide Brands, Inc., want to know what the Demand on the 'Net is for a product, we spend many hours, and sometimes days, researching.

To find out what the Demand for something is, we need to find out how many people are searching for it in the Search Engines.

We try to find out how many people are using those Search Engines to look for the product we want to sell, then we categorize that information according to the different search term variations people use.

For example, if someone were searching for a place on the Internet to buy salted peanuts, they might use the search term "peanuts, lightly salted", or the search term "salted peanuts", or many other variations. We have to try to think of what those variations might be, and find out what the Demand is for each of them. Overall, we're looking for numbers on just how many people are searching for our product using different search terms. The more people who are searching for it, the higher the Demand.

Once we have those numbers, we go on to the next part of our research.

  • Find out what the level of Competition is:

So, what else do I need to know if I want to sell salted peanuts at a baseball game?

Well, I've done my Demand research. I know that this particular game will be a summer game, so the peanuts won't get cold and crunchy. So, I know I have a good Demand for the product.

Now, I need to know what my Competition will be like. Before I pack up my peanuts and go to that game, don't you think I should try to find out how many other vendors I will be competing against?

If there are fifty other vendors in the stands selling salted peanuts, I do not want to be 'salted peanut vendor number fifty-one'!

So, I'm going to do some more research. I'm going to contact the ballpark's management office, and try to find out how many of the vendors at the ballpark are planning on selling salted peanuts. They may not know exactly, but they'll have an idea. If there are fifty other vendors selling salted peanuts, I'm going to ask how many vendors are selling lemonade. I may not like lemonade. Maybe the taste of it makes my face scrunch up and look goofy, and the sugar gives me the squeaking jitters.

However, if there are only five other vendors selling lemonade, I'm going to screw together my courage and darned well sell lemonade at that ballpark instead of salted peanuts. Knowing salted peanuts as well as I do, I know there are going to be a lot of thirsty people there, with fifty salted peanut vendors roaming around.

Again, the internet is the same way. The 'Net is just another place to sell things, and if there are too many people selling the same things, nobody makes any money on them. That's what we're here for, after all, right? We're in this ECommerce thing to make money, not to satisfy our personal taste.

Once again, when we at Worldwide Brands, Inc., want to know what our Competition is for a new product, we spend many hours, and sometimes days, researching on the Internet.

What are we looking for? When we look for our Competition, we know that there are two basic ways that people sell on the Internet. They use Internet Stores, and they use Auctions. So, we need to look at both.

We start with a dedicated Internet Store shopping site with a high degree of popularity; Yahoo Shopping. We spend hours in there, acting like a customer, using different search terms to search on the product we want to sell. We find out how many Stores sell only that exact product, how many sell products similar to it, and how many sell the exact product and others similar to it. We look at which Stores have higher popularity, and which of those feature our potential product more prominently than others.

We break all those numbers out into categories, and write all that information down. Then we go to the next part of our research.

  • Find out what the General Interest level is

Salted peanuts are a bit of a "gimme" in this area. Everybody knows what they are, and most people like them. On the Internet, though, it's important to find out what the general level of knowledge and interest is for a product before trying to sell it.

Here at Worldwide Brands, Inc., we go out to one of the big Search Engines, and search for our product again under many search terms. This time, though, we do it not as a customer, but as someone interested in information about the product. Kind of like the difference between wanting to buy a package of salted peanuts, and wanting to write a school report about how they are grown and packaged.

General interest in a product helps to gauge where our Demand and Competition numbers fall into the big picture.

For example, if there isn't much Demand for a product, and there isn't much Competition, it would seem that it might not be a good seller. You can't sell something to people if they're not out there looking to buy it. If there aren't many people out there trying to sell it, either, then it's probably not a good idea.

However, if there is a lot of General Interest, it may be that we've stumbled across the Holy Grail of Internet Retail research; the fabled Untapped Product Market!

That's rare, but it happens. People find Untapped Markets, and begin to exploit them through associative advertising (advertise a more common, related product to lead people to a new one).

However, as I said, the more common use for General Interest information is to help us understand what our Demand and Competition numbers mean.

Once we have General Interest numbers, we go to the next part of our research.

  • Find out how others are Advertising this product:

Let's say that based on my research so far, I think I can make a good business out of selling salted peanuts. I'm not just going to sell them at baseball games, either. I decide I want to place an ad in my local Yellow Pages, and sell salted peanuts to a lot more people.

Should I just jot a few words down, and send them off to the Yellow Pages Advertising Office?

Of course not. My research is still not complete. I'm going to need to see how many other people are advertising my product in the Yellow Pages. If there are a good number of them doing so, it may mean that it's a good product to get into. And if it is a good product to get into, I'm going to want to see what others are doing with their ads to make them successful.

So, I grab a copy of the Yellow Pages, and turn to the "P" section. Lo and behold, I find ads for salted peanuts. Some are big, some are small. Some are cheesy, and some are pretty interesting. I don't think there are too many ads to compete against there, so I decide to run an ad. I'm going to study the best elements from my competitor's ads, and create a better one than any of them.

Same thing on the Internet. If you're going to sell a product Online, you're going to have to advertise it in some way or another. Today, Pay Per Click Search Engines are the dominant force in Internet product Advertising.

So, here at Worldwide Brands, Inc., we hit the three most influential Pay Per Click Search Engines; Overture, Google, and Findwhat. That's where we begin our research.

Once again, we act like a customer. We use as many search terms as we can think of to search for the product we think we want to sell. What we're looking for here is twofold:

  • How many other people are paying to Advertise the product Online?

  • What do their ads look like and say?

The number of other people Advertising the product gives us a feel for whether the product is overexposed. If there is too much Advertising, that means too much Competition, which is not a good thing.

The way other people's ads look and what they say gives us ideas as to what our own Advertising could say if we decide to sell the product. We spend hours at a time gathering links to other Internet Retailers' ads for the product, then looking them over, comparing them and making our choices as to which ones we like best. Then we combine the kinds of elements we like from all of them, and create our own unique Advertising, hopefully better than any of the others.

Finally, we move to the last phase of the research process.

  • Analyzing all that information!

The Analysis process is not easy, nor is it pretty! It involves spreadsheets and charts and graphs and links and lots of time, cups of coffee, bleary eyes and late nights.

We have to look at all of the data we collected on Demand, Competition, and Advertising, and make a decision as to how they all balance out.

Here are some of the issues to consider:

  • Not enough Demand (as compared to Competition) means not enough people are going to buy.

  • Too much Competition (as compared to Demand) means not enough of a profit to go around.

  • Too much Advertising drives up the price of Pay Per Click ads, and increases Competition as well.

  • Not enough General Interest, combined with a low Demand, means that there may not be a good market even if there is some Competition out there trying to make the sales.

Those are just some of the things we consider. Overall, we compare all the various Demand, Competition, Advertising and General Interest numbers against each other, and use our own unique formula to make sense of it all.

Still with me? I know it's taking a long time to get to the point, but it's important that you understand the research process first!

Here's the good part of the story.

Several months ago, we were batting ideas around with Jon Wittwer, developer of the Market Matrix. Jon was telling us that he had based his Excel Spreadsheet-driven Market Matrix partly on information he read on our site. Funny how these things work. :o)

Jon's Market Matrix gathers all that detailed research information we talked about above automatically, by searching the Internet. We thought that was great. However, it still didn't complete the research process for us. We still had to manually sift through all that data and apply the unique research formula we use, in order to make sense out of all that information.

Somewhere along the line, a light bulb magically appeared above our collective heads. We said, what if we could combine some of the functions of Jon's Market Matrix with our own unique research formula, and build the whole thing into a computer program?

Great things can happen in the course of a phone call and a cup of coffee, folks. Believe it. :o)

We had just realized that we could completely automate this entire time-consuming manual research process!

With Jon's blessing, we forged ahead into developing that software. Well, it took months to do that, as I said. Our Programming expert, who is the most good-natured human being I have ever met, worked so long and so hard that he almost got annoyed once! That was a first. :o) My Business Partners, myself, and our Research Team also put in a great deal of time and effort into combining automated information-gathering techniques, and our own research formula, into a single piece of software.

Finally, we created The Market Research Wizard. (Trumpets sound; the crowd goes wild!)

The Market Research Wizard does in minutes what it used to take hours, or even days, to do.

It's a computer program in which you can type a couple of words describing the product you want to sell, and less than a minute later, gives you an actual Analysis (from 0% to 100%) of that product's chances of success on the Internet.

It connects to the Internet and automatically collects all the information I talked about above, usually in less than a minute. Demand, Competition, Advertising, and General Interest. Then, it uses our own unique formula (the one that I said we use ourselves, to make sense of all that data) and generates an instant Analysis.

That's not all, either. It not only tells you how much Demand there is for the product you want to sell; it tells you what key words you should use to market that product if you decide to do so.

It not only tells you how much Competition you have; it tells you where your Competition is, so you can decide if the product is better marketed in an Internet Store, or an Auction.

It not only tells you who your competing Advertisers are, it gives you clickable links to their ads, so you can study and out-Advertise the other guys.

It also allows you to export all your instantly generated research information to any Spreadsheet program, print your research, recall all your past research on any product, and more.

All in just minutes.

Now, remember what we say all throughout our web site and published information, folks. There is no magic bullet! The success of your business depends on many things, and proper research is just one of those things.

However, if you can take a process that you're not sure how to do properly, and have it done for you, the right way, you're greatly increasing your chances of success.

Along the same lines, if you can take a process that normally takes hours or days to do manually, and do it in minutes, you're gaining yourself a heckuva lot of time that can be used to concentrate on the rest of your business!

If you've subscribed to our Newsletter for any length of time, and you've been through our site and free information, you know that we are not into making heavy sales pitches. That's why this Newsletter goes to such great lengths to describe the manual process that we've used in the past to do our product research.

So, if you like, you can try the manual research process that I described above.

Or, if you like, you can go to Click Here, and download a FREE TRIAL of our new Market Research Wizard. It won't cost a cent to try it, and we know it will save you a tremendous amount of time, while helping your business succeed.

 

Chris Malta

Founder/CEO

WorldWide Brands, Inc.

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"Beware of Drop Shipping 'Agents'!"

Using a Drop Shipper is a great way to sell products on the Internet. A legitimate Drop Shipper is a manufacturer or a wholesale distributor who will send products one at a time directly to your customers for you, from the warehouse. You never have to buy inventory up front, and you never have to pack and ship products yourself. 

All you do is place images of those products on your Auctions or Web Site, and you collect on every sale without ever touching the product. 

Here at Worldwide Brands, our entire business is dedicated to making sure people have accurate, up to date information about legitimate Drop Shippers and Light Bulk Wholesalers. 

As we warn throughout our site, there is one constant thing in Internet Drop Shipping that you need to watch out for. Over and over again, you are going to see companies who do their best to make you think they are real wholesale drop shippers, when they are NOT. Companies who are NOT real drop shippers are middlemen whose sole business is to dip into your profits, by getting in between you and the real drop ship supplier. 

Drop Shipping 'Agents' are a particularly interesting example of this. You see, they DO provide access to one, two, or maybe a few REAL drop shippers. However, they are STILL a MIDDLEMAN. 

There are two problems with using Drop Shipping 'Agents'. 

They ARE middlemen. They charge you recurring monthly and/or annual fees that you should not have to pay in order to access the real drop shippers they provide access to. You should never pay a recurring fee for the 'privilege' of placing orders with a real drop shipper! 

You'll find the competition impossible to deal with. Most of these 'Agents' only give you access to one drop shipper. Even those 'Agents' who give you access to several drop shippers (and charge you more for it!) are doing something that can bury your business before it gets started. They are causing intense competition! They are going to advertise their service all over the Internet. Thousands, or even tens of thousands of people will pay for it. Guess what happens then? YOU, and all of those thousands of others are all trying to use the SAME small handful of Drop Shippers!  The competition becomes way too intense, and you'll never sell anything! 

Let's take a step back and go over the whole issue.  

A real wholesale drop shipper ALWAYS owns their OWN warehouse. They have offices in, or attached to that warehouse. It's a physical building, with walls, windows, doors, maybe a few trees outside on the lawn. There is a loading dock, where trucks back up and deliver pallet loads of products. They have people working for them in that warehouse. The people who run their web site peek their heads out of the office doors and say, "Hi, Wanda!" and, "Hey there, Mike!" to actual human beings who work there, receiving inventory from manufacturing plants, packaging orders for drop shipping, putting a new filter in the Coffeemaker, etc. 

Drop Shipping "Agents" work very hard to make you think they own their own warehouses. There are some who are very good at that. They tell you that you can access thousands, or even tens of thousands of products from their 'warehouse', or from many of their different 'warehouses' in different locations. 

Again, here's the first important part. Drop Shipping "Agents" do NOT own their own warehouses. They are MIDDLEMEN. 

No matter how many products or warehouses these people claim to have, they don't have a single one. They're just sitting in a house or a rented office somewhere, thinking up clever web site text and new ways to make you think they are the real thing. 

Some of them are even more clever. There are 'Agents' out there who will actually TELL you that they ARE 'Agents'. They'll tell you that even though they ARE 'Agents', they don't really make any money by acting as a middleman. Some of them want you to believe the do it out of the goodness of their hearts. Others will tell you that they make their money only from your 'Membership Fees'. However they say it, they usually bury this information in their sites, hoping you won't pay attention to it, and they sugar-coat it in such a way that it sounds really good to you if you DO realize what they are up to. 

Here's how they operate: 

1. They go out on the Internet and find one, two, five, or maybe even ten real wholesale drop shippers. 

2. They contact these real drop shippers, and say, "Hey, send us a list of your products and a bunch of pictures, and we'll help you sell them online through OUR order system". Most real wholesalers know better than to deal with something like that. However, there will always be some who will go along. 

3. They create a web site that makes it look for all the world that they are the Universe's Answer to Drop Ship Warehousing and Wholesaling. 

4. The small ones simply have one group of products you can order. When you place an order, they will turn around and send that order to the real drop shipper, who will send it to your customer. 

5. The bigger ones will tell you that they have a whole bunch of "warehouses" all over the place, with clever names. North Warehouse. South Warehouse. East and West Warehouses. Pink Warehouse. Blue Warehouse. Plaid Warehouse. You get the idea, right? They'll tell you that you can order from any one of those "warehouses", for a price. Some of them give you one or two "warehouses" for your initial 'Membership Fee', and then jack up the 'Membership' cost if you want to order from more of their "warehouses". Again, these people don't have any warehouses! Their "warehouses" only exist in cyberspace! Each “warehouse” is nothing more than a collection of product images that these middlemen got from a wholesaler that YOU should be working with DIRECTLY, instead of paying some 'Agent' a FEE for the privilege. When you place your orders, those orders will simply be turned around by the 'Agent' to the real drop shipper for fulfillment.  

Some of these "Agents' will tell you that it's better to work with them, even though they ARE 'Agents' because they are "centralizing" your ordering and shipping. Believe me, we've been in this business a long time, and we've never seen an ordering or shipping issue that was enough of a problem to justify ordering through middlemen. Not ever. 

Is this illegal? No. Is it a Scam? No, not usually. It's just a very poor business idea, in our experienced opinion. 

Think about it the second part of the problem again. These people are offering you an indirect (middleman) route to a small handful of drop shippers. They'll promote that same small handful of drop shippers to tens of thousands of people like yourself. Do you really think you'll be able to compete with thousands, or tens of thousands of others, who are all trying to sell the same products from the same small handful of drop shippers? Not a very pleasant thought, is it! 

Would you say it's a good business decision to take a middleman route to a very small number of drop shippers being used by a huge crowd of others? 

The answer is obvious, of course.

 

Chris Malta

Founder/CEO

WorldWide Brands, Inc.

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"There are NO Sales Without Market Research"

For people who are starting a Home-based ECommerce Business, one of the things that's least understood by most is the need for basic Market Research.

There are far too many people failing out there because they simply grab any product they can get ahold of, slap it in an Auction or on a web site, and expect it to sell.

A couple of days ago, I got an email from someone who was thanking me for the free information about ECommerce that she found on our web site. She, like most people, had been struggling with the concept of Wholesale Distributors and Wholesale Pricing, and had found the answers she needed on our site. Somewhere in her email, she happened to ask me how I first learned about Wholesale Distribution.

Now, I've spent years writing ECommerce articles that have been published in many different languages all over the world. My company, Worldwide Brands, Inc., teaches people through our web site, and our Customer Service department, all about Wholesale Suppliers, ECommerce, Market Research, and much more. I'm also a Founding Partner in a Wholesale Distribution company in New York. So, I've been around the business for a long time, and learned a lot along the way.

As I started writing all those things in my reply to this person, I realized that she hadn't asked for my resume! She had asked where I first learned about Wholesale.

It occurred to me that I actually learned about wholesale long before I ever grew up and went into business. The few simple things I learned about wholesale back then apply so well to ECommerce today that I just had to tell her (a shorter version of!) the following story:

Long, long ago, in a neighborhood far, far away, Chris Malta began learning about Wholesale. He was just a tyke then, only ten years old. Chris wanted to earn some extra money for the upcoming Christmas Season, way back there in 1970.

He tried shoveling snow out of people’s driveways, but there’s a lot of snow in Western New York State. Big trucks with nasty old snowplows kept driving by and shoveling the snow back into the driveways. He tried doing chores around the house, but there really wasn’t enough to do to earn him the Christmas Money he wanted.

One day, Chris’s mother realized his plight. An astute businesswoman, she looked down at him and seemed to come to a decision.

“Why don’t you get your coat”, she said. “I’ll show you how to earn money like the grownups do”.

Half an hour later, Chris and his Mom were at Beansy Altman’s Wholesale Outlet, in downtown Rochester, NY. It was a ramshackle place, shivering in the winter shadow of an expressway overpass; a big old four-story brick building that looked almost abandoned. Inside, though, it was warm, and there was a bustle of people weaving their way through stacks of crates and boxes. They were picking this or that item out of this or that crate or box, looking at it, and moving on.

Through the dim lighting and the smell of damp cardboard, Chris saw an old man waving to his mother.

“Millie!” he said, “did you bring a helper with you today?”

Chris’s Mom smiled and said, “Beansy, this is my son, Christian. He wants to earn a little Christmas Money this year”.

“Ah!” smiled Beansy. “Another businessman in the family! Well, all right. We want Christmas Money, we look at Christmas things!”

An hour later, the trunk of Mom’s car was packed full of thick, colorful Christmas candles, and little decorative plastic Holiday wreaths that fit around the candles’ bases.

On the drive home, through the gathering dark and a light fall of snow, Chris’s mother explained the glorious concept of Wholesale to him.

“Mr. Altman sold us one hundred Christmas Candles for twenty five cents each”, she said. “He sold us the plastic wreaths that go around them for twelve cents each. So, how much did we pay for the candles, just by themselves?”

Chris had to think for a minute. It would be another two years before he would meet Mr. Irwin, a wonderful teacher who would finally be successful in lighting the Eternal Flame of Mathematics in Chris’s young mind. He struggled through to the answer, though.

“Twenty five dollars for the candles”, he said.

“Right”, said Mom. “Now, how much did we pay for just the wreaths?”

Chris was warming up to the game. “Twelve dollars”.

“Right again. Very good! Now, tell me this; how much did we pay for one candle and one wreath, together?”

Some more thought, and a quick double-check on the trusty ole finger-calculator: “Thirty seven cents!” announced Chris.

“Thirty seven cents”, agreed Mom. “How much do you think they’re charging over at Woolworth’s for those same candle-and-wreath sets?”

“I dunno”.

“A dollar twenty nine. They’re very nice candle sets. I just bought two of them there yesterday. So how much less than that did we pay for each candle-and-wreath set?”

That one set Chris back a step, but before he could try to answer, Mom said, “That’s ninety two cents, Honey. We got them for ninety two cents less than they charge in the store”.

“Now”, Mom continued, “who do you think might like some of those candle-and-wreath sets?”

“I dunno”.

“Are you sure about that? Don’t you think Mrs. Gallucci next door would like to have one or two?”

“Sure, I guess”.

“Sure she would!” said Mom. “How about the rest of the neighbors? Mrs. Furius? Mrs. DiCiacci? Miss Cerasani? Mrs. Beilaski, Mrs. Carlevatti, Mrs. Toth, Mrs. Sengle, Mrs. Cook, Mrs. Sadack, Mrs. Anderson…”

The list went on and on. Mom knew the neighbors’ names like she knew the names of her own kids. As she spoke, Chris’s eyes grew wider and wider with the realization that he was going to sell those candle-and-wreath sets to the neighbor ladies, and make his Christmas Money!

Mom continued; “Now, how much do you think they’d like to pay for those sets?”

“A dollar twenty nine!” Chris declared proudly.

“No!” said Mom. “If they have to pay the same price they pay in the store, they might not decide to buy them. But, if they find out they’re getting them for less than the store sells them for, and they don’t have to drive through the snow to get them from the store, they will want to buy them. So, what you do is charge a dollar for the sets. Do you know how much money you’ll make if you sell all one hundred sets at a dollar each?”

“One Hundred Dollars!” Chris exclaimed, excitedly.

Well, not quite”, said Mom. “After you pay me back the thirty seven dollars I spent to buy the sets at Mr. Altman’s place, you would make sixty three dollars!”

Well, thought Chris, it wasn’t a Hundred Bucks, but still…Holy Smokes! Sixty Three Dollars! To a ten year old kid in 1970, sixty three dollars was a fortune in spending loot!

When they got home, Mom went over the major points with Chris once more:

“Let them know that you charge less than the store does for the exact same thing, and remind them that they don’t have to leave the house to get it. They’ll buy it from you, Hon. And you be sure to be polite and say Thank You!”

(Thirty four years later, Chris is sitting at his computer keyboard, writing this article. Besides getting a little misty over the memories, he is suddenly struck by the amazing similarity between what his Mother suggested as a sales technique in 1970, and the basic foundation of all Ecommerce today! “Less than the store charges, and they don’t have to leave the house…”. But, that’s not part of the story…not yet, anyway. Not for many more years, for ten year old Chris!)

So, Chris went out selling Christmas Candles, crunching through the frozen snow after school each day, in early December 1970. He didn’t sell them all, but he paid his mother back and made a nice pile of Christmas Money. His Mom put the remaining candle sets in the attic, and he sold the rest of them and more the following year.

During that year, and many others, his Mom helped him make many other trips to Beansy Altman’s and other wholesale outlets. St. Patrick’s Day, Easter, Mother’s and Father’s Day, Fourth of July, etc., etc. With Mom’s help, Chris bought seasonal products at wholesale all year round, and sold them to the neighbors, at a reasonable markup, of course. :o)

Why did I think this story was important enough to write an article about? Because it illustrates a very important point. Whether my Mother did it consciously or not, she arrived at a product for me to sell through Market Research!

Think about that story for a minute:

1. My Mother knew where my customers were. They were right there in my neighborhood, within easy reach of my sales vehicle; door to door selling.

2. She knew the "Demographic" of the customers; they were middle-class women in their early thirties. In 1970, this was a group that was almost exclusively homemakers, thus they were actively taking care of and decorating their own homes.

3. She knew that they would be very receptive to buying a Holiday decoration from me, because (a) it was the Christmas Season, and (b) what middle-class woman in her early thirties in 1970 could resist buying something (at a bargain) from a ten year old kid?

4. She knew who the competition was, and what they were charging for the product; Woolworth's Five and Dime Store, $1.29. That gave her the proper price point to sell the product with the added convenience of buying it right at one's own door; $1.00.

5. She knew where to get the product at Wholesale; Beansy Altman's.

That's Market Research.

The basic concept, the core business of what you and I do as Retailers, hasn't changed in 34 years. It hasn't changed in 340 years. It hasn't even changed in 3,400 years. Thousands of years ago, traders would travel to distant cities, bring new and exciting things back to their homelands, and place them on the ground in an open-air marketplace for passers-by to purchase. Hundreds of years ago, merchants in the fledgling US packed wagons full of goods in the East, and made the trek out West, where they used those wagons as storefronts to sell their goods to those who wanted or needed them. Decades ago, people had wholesale supply companies deliver products to their retail stores, where customers gathered to buy them. Today, we use email and electronic ordering systems to have products sent directly from the wholesale warehouse to our customers' doors.

None of it is possible, though, without Market Research. None of those Retailers, from the sand-whipped caravans on the ancient Silk Road to the manager of the Woolworth's Five and Dime on Winton Road in Rochester, NY, would have sold a thing if they hadn't known what the customer wanted!

So, before you get caught up in the technological hype of instant online stores, cross-linking, mass emailing, affiliate programs, blogging, search engine optimization, pay per click advertising, etc., etc., etc., go back to the basics for a minute or two. Think about who your customers are, who your competition is, what your customers want, and where you can get it at Wholesale. Without that, all the shiny new technological methods in the world mean nothing.

We have a great deal of FREE information on Market Research and much more on our web site, and you are welcome to it at any time.

Even today, as far as I've come in the business world, the image that comes to mind the most when I think about sales is very simple. I can still see it like it was just last week. Just me, by myself, ten years old, crunching through the frozen snow, happily selling Christmas Candle after Christmas Candle to my neighbors. Because my Mom knew they would buy them.

 

Chris Malta

Founder/CEO

WorldWide Brands, Inc.

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