Because I'm pretty convinced it can't fail. Starting from the top, I own an online store selling jewellery, it does alright purely online.. I get a ROI from facebook advertising amazingly. I have been in the jewellery business for about 3 years so I know what people like. I have since been attempting to get my range of products which are actually very unique and much loved by everyone that sees them, into retail stores on a consignment basis. Consignment, for those that don't know, is when a store takes my products for no upfront cost, and if they sell an item they take a cut of the sale price and I get the rest. So far I have made two deals.
I set the retail price of the items and the stores takes 40% of that. I want to make it worth their time.
1. First store is a local custom jewellery store, the guy there mainly does custom made wedding rings and stuff like that, my line has been in there for about 8 months now. On average I get about $300 a month in profit from that store after he takes his commission and I take out my expenses. This store does not get a lot of foot traffic and he is very often closed during the week because his main business is by appointment.
2. Second store is a new jewellery shop that opened up in my suburb, it gets a shit-tonne of foot traffic, they have been in there for a month and a half and my profit so far is $966 after expenses and subtracting the stores commission. This one is obviously much more productive than the other one. My items are in the store window and the couple that runs it are extremely friendly and easy going, it's perfect.
Based on these figures... My goal now is to get deals with 10 stores which I believe would be a very easy task. These first 2 stores were easy to convince and my products basically sold themselves on first glance. Earlier on I visited two different stores, one wanted me to provide a lockable cabinet, packaging for the products (which I didn't have at the time), he was very demanding and I didn't get a good vibe. I never bothered to go back there. The other store wanted them too but It was just down the road from the number 2 jewellery store listed above that is selling them now, so a bit too close for comfort. Either way it shows it is not hard to convince stores to give them a try. It's nothing out of their pocket at the start, and if they sell they make money. If they don't sell, they haven't lost anything and the stock still belongs to me. It's a win-win situation.
Based on the current stores, I estimate on average each will generate me a conservative profit of $400 a month, that's $4000 a month profit from 10 stores without me having to do a damn thing apart from invoicing and restocking them. About the average salary of a 9-5 schmuck.
The only downside to this consignment approach is that it ties up a lot of my stock, I have to provide say 10 styles of items and there's 6 sizes of each. 60 Items per store. This will cost me about $500 in stock per store. Basically the first month should cover my investment and from there it is highly profitable even after restocking. The stock still belongs to me if it doesn't sell anyway. I could take the wholesale approach but I think it would be harder to sell to shops since they actually have to invest money in my stuff at the start and I would have to sell it cheaper than the 60% highly profitable cut I get from consignment.
The sky is the limit... 10 stores = $4000 a month, 30 stores = $16,000 a month for doing very little work, just the way I like it. Visit once a month, count what has been sold, invoice them and off I go.
Is there anything I'm missing here?
I set the retail price of the items and the stores takes 40% of that. I want to make it worth their time.
1. First store is a local custom jewellery store, the guy there mainly does custom made wedding rings and stuff like that, my line has been in there for about 8 months now. On average I get about $300 a month in profit from that store after he takes his commission and I take out my expenses. This store does not get a lot of foot traffic and he is very often closed during the week because his main business is by appointment.
2. Second store is a new jewellery shop that opened up in my suburb, it gets a shit-tonne of foot traffic, they have been in there for a month and a half and my profit so far is $966 after expenses and subtracting the stores commission. This one is obviously much more productive than the other one. My items are in the store window and the couple that runs it are extremely friendly and easy going, it's perfect.
Based on these figures... My goal now is to get deals with 10 stores which I believe would be a very easy task. These first 2 stores were easy to convince and my products basically sold themselves on first glance. Earlier on I visited two different stores, one wanted me to provide a lockable cabinet, packaging for the products (which I didn't have at the time), he was very demanding and I didn't get a good vibe. I never bothered to go back there. The other store wanted them too but It was just down the road from the number 2 jewellery store listed above that is selling them now, so a bit too close for comfort. Either way it shows it is not hard to convince stores to give them a try. It's nothing out of their pocket at the start, and if they sell they make money. If they don't sell, they haven't lost anything and the stock still belongs to me. It's a win-win situation.
Based on the current stores, I estimate on average each will generate me a conservative profit of $400 a month, that's $4000 a month profit from 10 stores without me having to do a damn thing apart from invoicing and restocking them. About the average salary of a 9-5 schmuck.
The only downside to this consignment approach is that it ties up a lot of my stock, I have to provide say 10 styles of items and there's 6 sizes of each. 60 Items per store. This will cost me about $500 in stock per store. Basically the first month should cover my investment and from there it is highly profitable even after restocking. The stock still belongs to me if it doesn't sell anyway. I could take the wholesale approach but I think it would be harder to sell to shops since they actually have to invest money in my stuff at the start and I would have to sell it cheaper than the 60% highly profitable cut I get from consignment.
The sky is the limit... 10 stores = $4000 a month, 30 stores = $16,000 a month for doing very little work, just the way I like it. Visit once a month, count what has been sold, invoice them and off I go.
Is there anything I'm missing here?
