How to start up business

Flyonthewall

martindow wrote: »

I find it hard to understand how you will not make any money if you have postage charges but somehow it becomes profitable with the enormous overheads of a shop.

As has been said if you can give approximate weights, sizes and values of a some items you have in mind people could help you with postage options.

We're on page 8 and and your plans seem as vague as ever!

That's alright, I understand and I'm the one with the idea

Shop=buy low, sell high, make profit on each item sold. Profit covers costs (hopefully).

Online=buy low, sell high, take away fees, add in postage costs and it means that overall I'm making a loss. Unless I can work out how to get postage for less and/or get the items cheaper.

I know. Page 8 and the lack of detail, me summing up everything and stating the thread is going in circles still isn't enough to end it. There's never going to be any more detail.

NiceGuyEddie_2

Flyonthewall wrote: »

Shop=buy low, sell high, make profit on each item sold. Profit covers costs (hopefully).

Online=buy low, sell high, take away fees, add in postage costs and it means that overall I'm making a loss. Unless I can work out how to get postage for less and/or get the items cheaper.

How are you the only one who doesn't see the problem with this?

P&P costs > shop overheads. Madness. Please, please go through the costs thoroughly and get them checked by people who aren't friends & family before opening a shop.

I know this thread seems negative but it's because people really don't want to see you lose money on this and based on the minimal information you're willing to provide then it looks like you will.

gb12345

NiceGuyEddie wrote: »

How are you the only one who doesn't see the problem with this?

P&P costs > shop overheads. Madness. Please, please go through the costs thoroughly and get them checked by people who aren't friends & family before opening a shop.

I know this thread seems negative but it's because people really don't want to see you lose money on this and based on the minimal information you're willing to provide then it looks like you will.

Your wasting your time - the OP appears to have no understanding of the concept of fixed costs and their impact on his profitability. All he seems to see are the direct cost savings of selling through bricks and mortar.

EPL

Flyonthewall wrote: »

Shop=buy low, sell high, make profit on each item sold. Profit covers costs (hopefully).

Online=buy low, sell high, take away fees, add in postage costs and it means that overall I'm making a loss. Unless I can work out how to get postage for less and/or get the items cheaper.

:rotfl:Jesus wept!!!!

Ok then, without telling us the product, how much profit per unit sold (on average) will you make if sold through a shop unit ?

Flyonthewall

NiceGuyEddie wrote: »

How are you the only one who doesn't see the problem with this?

P&P costs > shop overheads. Madness. Please, please go through the costs thoroughly and get them checked by people who aren't friends & family before opening a shop.

I know this thread seems negative but it's because people really don't want to see you lose money on this and based on the minimal information you're willing to provide then it looks like you will.

With the shop I will be selling items for more than I'm buying them for. Therefore I have a hope of covering the costs if I sell enough.

With online, I make a loss on every single item unless I sell enough to get a postage discount and/or work out a way to send items cheaper.

Flyonthewall

Ok, let's say I could buy an item for £10 and sell it for £15.

Online others are selling for £15 with free postage.

The postage costs £5 and there's 10% fees (to keep it simple).

Ignoring other costs that is £5 profit on one item. With them costs that profit is eaten up with postage, then I have 10% fees too.

Even with the postage being half at £2.50 the fees would be £1.50 so that is £4 costs, which if I could manage that would be £1 profit. So yes, that would work but as of yet I have not thought of a way to get the postage cheap enough aside from a postage discount from selling loads. Not sure if it would be that much cheaper though?

Now in a shop, say I have £1000 costs a week. Yes that is far more. I get it.

However, for each item I make £5 through buying at £10 and selling at £15. So if I sell enough I could make a profit.

I am well aware that I may not sell enough and could still be making a loss but I at least have a hope of selling more to get a profit rather than selling online at a guaranteed loss (unless, once again, I can get postage cheaper) each time.

gb12345

Flyonthewall wrote: »

Online others are selling for £15 with free postage.

OK, so how are these sellers managing to do that and remain in business?

Is the product identical to the one you will be selling or are they selling an inferior version?
Is there some other supplier that is selling them cheaper that you haven't found yet?
Have you totally over estimated the cost of postage (or missed an alternative option).

You mentioned earlier that your item is a collectable - are these other sellers selling BIN or auction style on eBay?

Flyonthewall

gb12345 wrote: »

OK, so how are these sellers managing to do that and remain in business?

Is the product identical to the one you will be selling or are they selling an inferior version?
Is there some other supplier that is selling them cheaper that you haven't found yet?
Have you totally over estimated the cost of postage (or missed an alternative option).

You mentioned earlier that your item is a collectable - are these other sellers selling BIN or auction style on eBay?

A lot on ebay are from China and some are an inferior version, although even though sell for roughly the same amount and people seem happy to buy them.

As for the rest, they probably sell many other different items and either get postage discounts or don't care about the loss with selling in bulk or they manage to get them a little bit cheaper from somewhere.

There may be a cheaper courier, but its whether they are any good...as far as Royal Mail goes it's at least a small parcel if not medium.

And most are BIN. Very few auctions for them.

gb12345

Flyonthewall wrote: »

A lot on ebay are from China and some are an inferior version, although even though sell for roughly the same amount and people seem happy to buy them.

That is where your planned business model is totally wrong - people are happy to pay the same for an inferior product, so why are you insisting on selling a better quality product for the same price.

Either start selling the inferior version at £15 or sell the superior version for £20 (or whatever the market can take - although not knowing what the product is it is hard to know if there is any real difference between the inferior and superior versions) and make a point of promoting the benefits of your superior version.

Flyonthewall

gb12345 wrote: »

That is where your planned business model is totally wrong - people are happy to pay the same for an inferior product, so why are you insisting on selling a better quality product for the same price.

Either start selling the inferior version at £15 or sell the superior version for £20 (or whatever the market can take - although not knowing what the product is it is hard to know if there is any real difference between the inferior and superior versions) and make a point of promoting the benefits of your superior version.

Inferior product is like £15 and the good quality is £16/£17. It would cost me about £10 to buy the inferior and £11/£12 to buy the good quality.

It's not always clear from the descriptions which is inferior, but you can tell from feedback. Many are happy, but there are those who know they're inferior and give negative feedback.

I think it depends what people do with the item. Inferior ones probably break easier, may feel lighter (though if you don't know the weight you may not know) and damage easier. Some don't look quite so good as they should but even the good quality ones can look a bit off so...