Costing for products + pushing for more business

[jt196]

Hey all at UKBF,
I've recently inherited a family business and a part of it manufactures and sells fishing tackle.

Prices haven't been put up for years and there's been no push for new customers for longer.

We're aiming to sell mostly to trade: shops and distributors. I'm also thinking about putting an online shop up.

Any of you got any pointers in terms of how to price up the products we sell?

At the moment we offer a discount on early payments but I'm thinking about taking that off and just giving that through the website to give people an incentive to use it.

So how do I set up a website and keep it trade only - so how does this work? Obviously I need to market it, but I want to keep it away from members of the general public so I'm not faffing around too much with small fry. Does that mean giving a minimum order value? How do I decide that?

Thanks in advance - in the vein of this rather open-ended question, any open-ended advice is welcome. I need to drum up more business so any help here would be most welcome.

 

[mud-stx]

How about checking your competitors sites for pricing? Probably give you the idea for prices, I imagine.

To keep it trade, a min order value would be good, but how about a login requirement when customers are about to make a purchase?

We created a website and our customer wanted both trade and general public customers but wanted to distinguish between them (for pricing purposes), so we created a system where the website would ask for a VAT reference number to prove it is trade customers, and they would then get the trade prices...

 

[bridges]

I would be careful about removing the early payment discount, at least until you're more 'in the swing of things' as such, I don't want to seem to tell you how to suck eggs, but if you're still new to the business, it could be that a. not many people take advantage of it, but adds a good sales angle or b. it could slow down cash flow if enough people do take advantage of this.

Just a thought.

Vicky

 

[jt196]

Bridges - I'm aware of that, but the issue with the early payment is that at the moment customers aren't paying the payment early. Hence, the website - payment is made instantly and there's no risk of the late payment going through. Not having the 5% discount is also a step towards upping our prices...

And by all means, telling me how to suck eggs would be a bad thing if I knew how to do that...

 

[TotallySport]

I assume that there are plenty of fishing suppliers in the UK, if you start selling directly to the public you might alianate your customers and they might stop buying from you altogether.

I agree with the point out early payment discounts, we would certainly take advantage of it, and as soon as you drop it, the suppliers which do have it will be more favourable.

For more trade, get the yellow pages out or google your local fishing shops and ring them up to make an appointment, and move out over time.

Good luck

 

[TotallySport]

If people are not paying early, you need to find out why, if your slack with credit control that could be one reason, but getting people to pay ontime is vital, add the web site will get payments in but not everyone likes using them to buy from suppliers, we are in the process of automating our supplier ordering process but the one thing that worries me is loosing the contact which gets better that better deal or special offer I might miss by not phoning.

 

[bridges]

Sorry my mistake, I thought you were going to give the discount to the internet users rather than the early account payers.

Good luck with it all, I hope it works out for you

 

[jt196]

Sorry my mistake, I thought you were going to give the discount to the internet users rather than the early account payers.

Good luck with it all, I hope it works out for you

Cheers man! No you were right in the first place, I was thinking about removing the discount from the regular orders and moving it to the internet.

In terms of the customers paying early, I guess that could be a case of me checking bank statements, but I'm not sure I want the added complications of billing customers for late payments etc etc. I'm very much a 'keep it simple' guy.

 

[mud-stx]

What about those customers that are regular and pay direct to you just for the discount, but have no desire to pay online? (like totally sport stated)
I think you would need to put a system in place where you would be able to cater for your old regular custom and new customers...it'd be simple I suppose when you sit down and break it down.

 

[bridges]

I think keeping it simple is a great idea, especially if you are really new to the business.

All good ideas here, I think what mud-stx said is important, the internet is a great marketing tool and will help with the new customers, and appeal to those who prefer getting things done online, but it is worth considering the old customers too.

I imagine it's difficult taking on someone else's business! I really do wish you all the best!