Whether you're starting an online business or a small retail shop, finding inventory you can sell through your business is essential. Locating steady suppliers of good merchandise, and then working out advantageous terms is the key to ongoing success.
Determine how much you can afford to invest in inventory and where you can safely warehouse your goods. Buying in bulk is one way to drastically reduce the cost per item of your inventory, but you run the risk of loss if you can't safely store the goods. Manufacturers and wholesalers are the traditional source of inventory bought in bulk. Search the Internet for manufacturers or wholesalers, or associations, organizations, or directories that list manufacturers or wholesalers. Your library may also have printed directories.
Compare the cost of buying readily available merchandise with having your own goods specially manufactured for your business. The advantage to the latter is that you can customize the goods with your own branding to increase your presence in the market. Manufacturers can often start from scratch with your design or modify generic merchandise to meet your specifications or include your label.
Search online for liquidators, companies that close out goods from a variety of sources. You may not have the broadest selection of merchandise, or even the type of goods you are looking for, but the price might be right and you can turn a quick profit. This works especially well for finding merchandise for online auction sites like eBay. Auctions, Craigslist, garage sales, and sales at storage facilities are also prime for finding affordable goods to sell.
Take advantage of suppliers who will "drop ship" merchandise for you. This works particularly well with a catalog or online business. You take orders and pay for the goods and the drop shipper sends the merchandise from their warehouse directly to the customer. There are drop shippers who deal in every conceivable type of product, including electronics, software, books, and clothing.
Sell information through e-books, reports, or even printed books which can be accomplished without the need for maintaining any inventory. E-books and reports can be acquired from a variety of sources online and resold through download on your own site or sites like PayPal Shops. If you have written your own book you can have it printed "on demand" when a customer orders a copy. Amazon.com's CreateSpace, for example, will publish and market books, CDs and DVDs at no initial cost to you.
Taking pieces on consignment, whether it's artwork, clothing, books, or musical instruments is another way to stock your store with no upfront cost. The owner of the item allows you to sell it at a pre-determined price and then you split the proceeds as per your agreement. Even if you have a "brick and mortar" store, consider an online site where you can add to your sales with merchandise supplied through drop shippers . Ask for 30, 60 or 90 days to pay for merchandise from your wholesaler. The better a customer you become, the better the terms.
Be wary of taking delivery of perishable or time-dated merchandise unless you are reasonably certain that you can sell it quickly. Don't tie up too much of your operating capital in inventory.
Keep methodical control of your inventory. Have an attorney review any contracts with manufacturers or wholesalers, especially if they involve long term arrangements.
- Image by: Mattes, Creative Commons