3 Questions to Ask Yourself If You Want to Sell Electronics
by Jennifer Ratliff on October 1st, 2007
Every good seller knows how profitable it can be to sell electronics. Their popularity and long shelf lives guarantee a good return on your investment. And while knockoffs and used brand named electronics are easier to procure, if you have any desire for a future in sales, you’ll eventually want to join “the big league:” selling new brand name electronics .
The Internet revolution has opened a global market for popular electronics, and no electronics company has enough people to cover all of those markets. Companies are beginning to realize the advantages of licensing their brand name, and electronics companies know this more than most. Income opportunities abound if you’re willing to chase down the companies and put in the time and legwork to make the sales.
In order to sell brand name electronics, you will need a license. This shouldn’t be too much of a surprise, since it takes a license to do many things in the world of commerce. If you don’t have a business license, this is the first thing on your to-do list. Once you have a regular business license, if you are going to buy or sell electronics as a wholesaler, you will need to have a reseller’s license. This license permits you to buy merchandise without paying the sales tax and is a standard addition to most business packages.
If you think you’re ready to sell brand name electronics, sit down with a notebook and pencil and make sure. Brainstorm about the kinds of electronics you would like to sell and any particular name brand that interests you. Answer the following questions:
1. Do you want to sell new or used merchandise?
Overstock.com and other clearance sites allow you to purchase pallets of electronics for a set price. Once you receive the merchandise you can divide it and price it as you wish. If you don’t have the room or the patience to inventory a pallet of merchandise, you can work through a drop shipper , for whom you will serve as an intermediary.
2. Do you have an established business or specialized knowledge in the subject?
Yes: If you have been in business for a while or have a good business reputation, you may approach a local sales representative of the brand that you would like to sell. Ask them about their resellers program. It is rare that they would simply hand over product for you to sell, but if nothing else you can walk away with a reseller’s application and some honest respect.
No: Going to a trade show is a good way to pick up lines of electronics to sell, since many manufacturers will bend over backwards to work with people who show they are serious about their product. If you are new to the sales game and your business is still in the fledgling stage, you may have to prepay for the merchandise and keep it warehoused.
Even if you are going to work through a manufacturer at a trade show to sell electronics, you will want to know the steps you need to take to follow through with a reseller’s application. The questions on a resellers application may appear to be overly detailed and thorough, but don’t be offended. You are applying to represent a company’s pride and joy, and they are simply taking the same precautions in screening individuals as you would if it was your company. Expect to find questions asking your company name, length of time in business, last year’s financial dealings, how many employees you have and what type of business you run as well as other questions about financial strength and monetary position. They will also ask what you plan to do with the license should they award you one. You have more of a chance at acceptance if you are honest here instead of flattering.
3. Are you ready for the responsibility that comes along with selling brand name electronics?
When you agree to a licensing agreement with a brand name company, you will be bound by contract to work with that company for a specific amount of time, selling a certain number of products. If you don’t want that kind of commitment, you might be better off sticking with selling the occasional brand name stereo or appliance. Before you sign a contract, read everything carefully. They will ask that you sign a Non-disclosure agreement (aka NDA) to guarantee that you don’t pass any industry secrets along.
Besides signing a contract, you will have to take responsibility for the products you sell, or the products that you manufacture to sell. Once the merchandise has been sold and distributed, you are responsible for collecting payment and remitting the proper percentage to the company that you represent.
There are some advantages to being licensed to sell brand name merchandise. The world of electronics is full of potential, and licensed resellers often receive generous discounts on merchandise, a heads-up and a free preview of new releases, and the advice and mentorship of a company executive to boot. Finally–and this is often an unappreciated benefit–you have an opportunity to specialize in an area of sales that is often more profitable the more you know.
It’s helpful. Thanks for sharing.
beamq
April 8th, 2009
at 4:00 am
can you sell the product at any price or is their a cap so you won’t be too competitive with the competition?
Martin
June 24th, 2009
at 10:19 am