Basics of Business - Informative
Since this has been under some debate recently, I would like to give some information regarding the following post. There are inconsistencies that I believe people should be aware of when dealing with this business. If they will publish this, then they may be supplying other false information.
As a Store Owner, it’s not always possible to run by the rules you list. We are a direct retailer for Mattel and when a box of Monster High dolls arrive, they may have 1 or 2 current, marketable dolls in a case of 6. We mark up the dolls that sell and have to eat a deficit on the dolls that sell below our cost or sometimes can’t even give them away for the cost of shipping.
At the end of a quarter we donate these dolls to our charity in the Philippines and move along. I know it seems like retailers of Specialty items “scalp” in your words but how would you balance a case of 6 dolls when only 1 or 2 are marketable? Bump this up to 20 or 30 cartons at a time and I have a warehouse of dolls that will never sell.
When (if) we get larger we can spread the loss around and charge a nominal profit for all items but as it is right now we play by the small business rules and not the huge big-box, mega store rules where a profit of 90 cents is doable.
For the record, we buy directly from manufacturers and distributes and not from retail shops as a rule. However, it’s sometimes necessary to survive the quarter. We are a very Small Business.
Not to ‘pull strings’ here, but, there are many things wrong with your post.
1. Mattel has a HUGE buy-in to become an official retailer and purchase wholesale direct from them. And I mean so huge that the comic shop I subscribe at, that has been in business for 20+ years and I am close with the owner, still is not an official retailer with Mattel because the initial cost is so high they are not sure it’s worth the investment and initial order. I highly doubt that such a small, struggling business would have the funds to buy in with Mattel right off the bat.
2. This theory of not being an official retailer with Mattel is supported by the ‘when a box of Monster High dolls arrive, they may have 1 or 2 current, marketable dolls in a case of 6’ statement. The cases are not a mish-mash of old and new dolls. They are set cases, and you know what you are getting when you order it. This is supported by the availability of cases via established retailers (such as Entertainment Earth), or even walking into a store when they are opening their new stock.
3. If a company is an official retailer with any supplier, they are getting the merchandise at the wholesale cost, which is the same as other stores, and their mark-up should not have to be any higher. Again using the comic shop as an example - he purchases figures (such as DC Direct, Sideshow Collectables, etc) for wholesale via a contract with the company. You then pay the same price at his store as you would pay through any other retailer that has that same contract.
I feel it is important that people are aware of these types of situations before they trust their personal information and/or money with someone, and that is why I took the time to write this.
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