"Start Me Up!" - Hurdles, Hurdles, Hurdles,... Let's get around these shall We?!

[LiberateMe]

Hi everyone. I'd greatly appreciate any and all helpful advice.

I see an opportunity to make $$ reselling an information product ( a DVD set).

I have contacted the product creator and requested a wholesale pricelist and terms.
Finally, they've responded only to say that they are not selling this product at wholesale prices, but sent me the wholesale application anyway. (because they've created other products for sale)

The application is one page asking me about state and primary address of my business (I live in Canada, but plan on primarily doing business in US), FIN or SSN #, California Resale No, My Forecasted Annual Sales of this product, etc....YIKES !!!!:eek:

Also, the agreement states that I'm to pay online at their store and there is a minimum order value required by me.. The value of each order I place will determine my wholesale price..... (yeah, right!!)

The problem(s)

1) They are NOT wholesaling this product to me (I'm the reseller) = no profit margin for me.:mad:

2) It appears that they want me to buy a lump of products and pay retail price for it instantly = inventory (physically handling and storing product) and risk of my money. (Very different from a "drop- ship" agreement that I seek)

3) They want me to give them an idea of how much volume I can sell for them (if they ever consider allowing me to resell this product)

4) I'm trying to obtain Exclusivity (even if for only an initial trial period to prove that we can sell large volumes of their product).... Is a 6 or 12 month trial reasonable?


Remember I'm just starting and I'm at the the point where I believe I've got a niche product that has as healthy demand.

I'm not going to pursue this (wasting time and $$$ on "testing the muse" ) if I can't even get the product at wholesale prices and arrange for "drop-shipping".

So can anybody provide me with a quick, easy, step-by-step way to achieve what I want with this supplier?

It's seems that I might be at the right place at the right time, if I can persuade them to give me a shot because I know there is a demand, it's a great product and they don't have any resellers for this product yet, which puts me in a position for exclusivity.
You know the phrase "fake it till you make it". I fell that it applies here, but being so new at this I'm not confident. If they "call my bluff" I don't think I'll be able to fake it.

Please tell me exactly how to make this happen. How can I entice them to give me a shot????
(between you and I, I've got a fair bit of online classified ad marketing experience, but I'm new to the PPC game... Lots to learn... how can I tell them we'll sell "x" products this year? )

How do I present my proposal so that it looks like I know what I'm doing?
I need to press their "greed button" (prove I can make many sales of their product (which I'm not sure of the most effective way to do this) and I need to make them feel safe (as if there's no risk in giving me Exclusivity to sell this product)

SUGGESTIONS ARE VERY WELCOME..PLEASE HELP

Thanks, you guys rock! I'm proud to be one of you.:)

[Domer88]

In every business negotiation, you should try to understand the position of the other party. In this case, the reasons why you want to drop ship are the same reasons they do not want to drop ship. You don't want to buy and hold inventory. They don't want to hold inventory either. They want to recognize revenue as quickly as possible, and making you buy product is the quickest way for them to recognize that revenue.

And no one is going to grant an exclusive without something to be gained on their side as well. You are asking for exclusivity, but what are they getting in return? Why would they be motivated to grant you that, especially if you can not project a certain amount of sales. If you were an established business with an existing channel to market, you would have something to offer them. It would also make them more likely to give you wholesale pricing. Put together some projections of sales volume and see if those volumes make them more open to cutting a deal. Just make sure you are not committed by contract to buy that much product from them.

You should try to come up with a win/win proposition. For every thing you are asking for, make a case why that is a good deal for them as well.

[Sven]

Let me look at it from a different way. I recently asked a bicycle manufacturer if I could become a dealer for 1 of their models. Yes, just one model. Their reply:

Sure, if you are a business and if you stock at least one, you're good to go.

Now can you make an arrangement any simpler?

If you compare that to what these guys want from you in return for very little, I'd say walk away!

[LiberateMe]

You don't want to buy and hold inventory. They don't want to hold inventory either. They want to recognize revenue as quickly as possible, and making you buy product is the quickest way for them to recognize that revenue.

thanks for the prompt reply.

This is an information product which takes very little time to manufacture, so I was thinking that they wouldn't even have to make the product until I had a product order for them. (therefore= no extra inventory). Isn't that how drop shipping can work? In the 4hww example with "Prosoundfx", doug accepts credit card payment from the end-consumer the same day that he is only placing the order with the manufacturer...So he's doesn't purchase anything with his own cash. Isn't this possible for me to arrange also? Does anyone have experience with this method? How can someone negotiate this?

Domer88: "And no one is going to grant an exclusive without something to be gained on their side as well. You are asking for exclusivity, but what are they getting in return? Why would they be motivated to grant you that, especially if you can not project a certain amount of sales. If you were an established business with an existing channel to market, you would have something to offer them. It would also make them more likely to give you wholesale pricing."

Yes, I'm aware that it needs to be beneficial to both sides. My question is: Anyone with little or no experience can do this, right? (That's part of the goal of the 4hww) If it can be done by even people just starting, please tell me how?
At this point I haven't got any credibility or track record so how then, can I make this happen? What can I offer them right now that will persuade them? I'm hoping somebody can see and offer me an angle to "sell" this proposal to them.

Domer88: " Put together some projections of sales volume and see if those volumes make them more open to cutting a deal. Just make sure you are not committed by contract to buy that much product from them.

You should try to come up with a win/win proposition. For every thing you are asking for, make a case why that is a good deal for them as well. "

Could you tell me how to "put together some projections of sales volume" I have never done this before. I could pick #'s out of thin air, but somehow I don't think that's what you mean. :confused:

thanks again for your contribution, I look forward to hearing more.

all the best

[LiberateMe]

If you compare that to what these guys want from you in return for very little, I'd say walk away!

Thanks for your advice.

Can you think of anyway to make this happen with these guys?


What can I offer them or anyone as a Newbie that will land me a good deal?

I was thinking that I could offer some sort of trial period with them based on my performance. Have you or anyone ever heard of or done this? If so, how is it done?

[AlexMoen]

I don't see why they would care to make a special offer based on performance. If you can perform, you can order bulk supplies, which is where they're offering you a discount. They're probably not making that much money off of you, and that's why they can only discount it if you promise upfront bulk orders.

What they're asking of you doesn't seem to out of the ordinary- they're probably a big company and only want to deal with serious buyers and want to cover their asses in case of legal issues.

I'd say search for a different manufacturer- it doesn't sound like you guys are a match at all.