I have struggled to organize and plan in my resale business like everyone else. At the start of my resale adventure, I honestly had no idea how everything worked, and I didn’t even think it was possible to even turn my collector lifestyle into a business.
I made a lot of mistakes in those early days which cost me time and money. Mistakes that I had never made or corrected in the past. I thought long and hard about why mistakes and confusion never happened in my previous profession – working as a regional manager for a national restaurant chain.
The answer was very simple and had always looked me in the face: any national company, including those I had worked for, already had structured practices and procedures in place for all aspects of daily life. daily, monthly and annual operations. Nothing was left to chance.
In my previous article, I discussed some of the basic business practices that I use to avoid many of the inevitable pitfalls and perils in the resale world. As your level of experience and your business grows, there are many other business practices that you can take advantage of that can help you move your business forward.
Off-season shopping is one of those concepts that I have been using for over a decade. The idea of reselling is to buy low and then sell high. Buying out of season is a good way to do this. Many items will cost you more if you buy them in peak season, like buying Christmas items right before Christmas.
If you are looking to get the best ROI (return on investment) then buying anything when the costs are the highest is not a smart decision. Buying vacation items right after the vacation or long before it arrives will always give you the lowest investment costs.
Most long time wholesalers including myself will buy Christmas items several months in advance to get the lowest cost possible. Just like ordering supplies in bulk, you should also try to purchase merchandise in bulk. Especially when the costs are at their lowest.
This same philosophy also applies to the sale of your items. If an item is hot in the fourth quarter but dead in the second quarter, it is very obvious that you should be selling those items. When demand is high, your items will sell for a lot more. Christmas lights, for example, are selling well year round, but will still sell for more around the fourth quarter due to increased demand.
But, of course, not all items can or should be purchased in advance. In some cases, I may make a direct purchase on close or discontinued items out of the blue. Supplies, not just merchandise, can also be purchased this way. If an opportunity arises that can save me money or save me money, I will always jump at the opportunity whenever possible.
In many cases, if you are an established business, there are ways to avoid paying immediately for these kinds of purchases. A national business will usually have its invoices due for purchases it made within 30, 60 or 90 days from the date it placed its order.
This means that many businesses can sell or benefit from items that they have taken possession of but have not yet paid for. I have found that I can take possession of the inventory and in some cases sell enough to cover the entire purchase, before the invoice is due.
Having a bank account for your business is essential for this specific reason. Once you are established with your bank, most businesses can get a letter of guarantee that you can provide to the company you are considering purchasing from.
The letter of guarantee is a legally binding document that guarantees that if you cannot pay for the purchase you make, your bank will. This is the easiest way to get free goods to sell. You should, however, choose your purchases wisely with this method, because if you cannot pay for the purchase and your bank is obligated to cover the costs, they will never offer you this option again.
But none of this is possible without your business having an EIN (Employer Identification Number), which is something all physical and traditional businesses have. With an EIN, you can get a business bank account, along with many other benefits that can help your business grow.
Many banks, including mine, offer free commercial bank accounts, which is another incentive. A business bank account can open many doors for resellers, just like for traditional businesses.
Reselling is a business in its own right, and once you understand all of the options available for your reselling business, the more opportunities you will have. And, of course, the more opportunities you have, the better off you will be. The better you do, the more money you will earn.