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MenuIs anyone familiar with consignment deals with retailers?
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Walmart calls it "Pay from Scan." Also "Guaranteed Sales." Sam's Club calls it a "Road Show."
I just worked put a consignment deal with a small independent retailer fo my client who is an inventor and product manufacturer. I'm hear if you need me.
I have a consignment deal with Fred Segal, as well as a few local shops, and many online stores. Each one works a bit differently, so I start with my own contract, and make changes accordingly to the way they operate. Consignment can be tricky, as you don't want to be responsible for lost or damaged goods, and you want to be paid on time - either per sale or per month, depending on your price point. You might also look into dropshipping, which frees up your inventory but allows online retailers to sell in a consignment style manner. Lastly, we had a unique model, where we would allow consignors to order wholesale from our site if they didn't have the right size, color, or style in stock. Would love to talk to you more about this!
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Do you think this can be a successful business venture?
I have several years of experience in marketing and optimization in the eCommerce space for one of the largest online jewelry retailers in the U.S. I also have several year of experience working with online retailers that operate under a subscription models. In order to answer your question, you will need to consider the following: Will your subscription revenue generate enough income to maintain the operational strains of this business model and be profitable? If you do not know the answer to this, you need to work backwards to arrive at the monthly pricing for your subscription service. Some things to consider: 1. Cost associated with operational logistics like shipping and fulfillment (assuming customers have to receive and ship the jewelry back to you) 2. Carrying costs associated with holding on to inventory on consignment. (assuming you will not own the jewelry outright) This may come with other contingencies like having to carry insurance and the operational aspects that will help you handle recovery of lost / unreturned inventory, etc. 3. Costs associated with building a transactional platform that is built for the monthly activity you will have with a subscriptions service. If you take Macy's for example, most customers place online orders 4 times per year or so. In your case, the nature of your model requires a different platform as you will be taking recurring payments, arranging returns, maintaining credit card / payment information, etc. In short, its a different animal that your startup eCommerce type platform. If you'd like to get more details or insights I'd be happy to hop on a call and chat.MP
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Any tips on how to structure a first-time wholesale deal?
I would offer them a proposal to reveal their source to you in exchange for a small percentage or fixed amount of each unit ordered. You would also need to structure the offer in such a way as to guaranty that you would not compete with them or circumvent them, if they agree then you would need a legal contract drawn up between you and themVM
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