- Original Poster
- #1
Im planning to start an online fashion retail business. As Im mainly selling small high end independent designerss accessories and I dont have much cash for initial stock, I have agreed that Ill feature images of their products on my site, take the orders and payments but they will ship the product out to the customers (basically dropshipping as I understand it).
What Im not sure about is a) what the commission should be that I charge, and b) when to pay the designers.
a) Commission from what I can tell, similar companies such as Not on the High Street take a 20% to 25% commission on each sale made through their website, so I was thinking this kind of percentage is about right? Its quite difficult to get this information from the searches Ive done.
b) Payment if I pay the designers as soon as the purchase is made, I wont have much bargaining power if they dont send out the products to customers for whatever reason (although it will obviously be a condition of my contract with them to deliver products on time). Also, if the products are subsequently returned by the customer and Ive already paid the designer, it will be a hassle to get the money back from the designer to refund the customer. Should I therefore make it a condition of the contract that the designers will receive payment 6 weeks after the purchase (does this seem unreasonable)??
Sorry, Im used to dealing with wholesale suppliers but this is all a bit new to me, so any help available would be very welcome!
Thanks
(Also posted in the Ecommerce section)
What Im not sure about is a) what the commission should be that I charge, and b) when to pay the designers.
a) Commission from what I can tell, similar companies such as Not on the High Street take a 20% to 25% commission on each sale made through their website, so I was thinking this kind of percentage is about right? Its quite difficult to get this information from the searches Ive done.
b) Payment if I pay the designers as soon as the purchase is made, I wont have much bargaining power if they dont send out the products to customers for whatever reason (although it will obviously be a condition of my contract with them to deliver products on time). Also, if the products are subsequently returned by the customer and Ive already paid the designer, it will be a hassle to get the money back from the designer to refund the customer. Should I therefore make it a condition of the contract that the designers will receive payment 6 weeks after the purchase (does this seem unreasonable)??
Sorry, Im used to dealing with wholesale suppliers but this is all a bit new to me, so any help available would be very welcome!
Thanks
(Also posted in the Ecommerce section)
