Reseller question

[OctopusOnFire]

Hi all first time posting here on UKBF
Firstly apologies if the question has been raised before, I did a little search but couldn`t find the answers I wanted

To explain briefly the business plan, it is a aggregator of products from a particular field. We are looking to build this mainly as a online marketplace. We are looking to contact several manufacturers from this field and see who wants to partner up with us and advertise their products on our marketplace.
Now this may sound like affiliate, however we want more control in order to access more possible revenue streams, like upselling etc . Thus we are thinking to not reveal to our customers who the manufacturer is for each product. This way the customer will do business with us instead of going directly to the manufacturers. As I see it the company acts like a intermediary/reseller between customer and supplier.
Worth mentioning that the products will only be bought if a sell takes place. Basically for each order from the final customer there would be 2 transactions happening, customer-mycompany and mycompany-supplier.

So if the business doesnt claim that it manufacturers or yet owns these products, then is it obliged to reveal who the actual manufacturer(s) is/are.

 

[fisicx]

Are you selling white label goods? If not I suspect the label on the product will give it away.

That being said, people like next day delivery. Unless the manufacturer is shipping direct you are building in an necessary delay.

It depends a lot on the products but I suspect you are making this far more complicated than it needs to be.

And what’s to stop the manufacturers selling direct and cut you out the loop?

 

[OctopusOnFire]

thanks for replaying
im not selling white label goods
for some products the label might be visible but these are a small percentage so i`m not bothered too much
the benefit here for the customer is having a platform he can find all these products in one place
there is nothing stopping him/her buying directly from the supplier but my marketplace will give him more choices to choose from

 

[fisicx]

Can you already buy these products elsewhere?

 

[OctopusOnFire]

the manufacturer/supplier can sell it online as well on their own website
so the answer is yes

 

[fisicx]

In which case I suspect your idea is a non-starter. There is no benefit in buying from you.

 

[OctopusOnFire]

thanks for your input
how about an answer to my initial question... any thoughts?

 

[fisicx]

Depends on your contract with the manufacturer.

 

[MOIC]

Hi all first time posting here on UKBF
Firstly apologies if the question has been raised before, I did a little search but couldn`t find the answers I wanted

To explain briefly the business plan, it is a aggregator of products from a particular field. We are looking to build this mainly as a online marketplace. We are looking to contact several manufacturers from this field and see who wants to partner up with us and advertise their products on our marketplace.
Now this may sound like affiliate, however we want more control in order to access more possible revenue streams, like upselling etc . Thus we are thinking to not reveal to our customers who the manufacturer is for each product. This way the customer will do business with us instead of going directly to the manufacturers. As I see it the company acts like a intermediary/reseller between customer and supplier.
Worth mentioning that the products will only be bought if a sell takes place. Basically for each order from the final customer there would be 2 transactions happening, customer-mycompany and mycompany-supplier.

So if the business doesnt claim that it manufacturers or yet owns these products, then is it obliged to reveal who the actual manufacturer(s) is/are.

Isn't your principal the same as any other business?

You're building a supplier base and selling/offering for sale their products. It's actually worse, as you say the same companies you'll be buying from can also sell direct to the end consumer, presumably at lower prices than you'll be offering.

 

[japancool]

What's the difference between this and dropshipping?

Are you the one who's going to have product liability insurance for these products?

 

[fisicx]

@OctopusOnFire - the problem you have isn’t so much your method of doing business - many others have similar set ups. The big problem is going to be marketing. As you don’t have exclusivity and will almost certainly be more expensive than the competition you need a very strong USP to get any sales.

 

[Martin Patfield]

We are a manufacturer. We 99% only sell through resellers because of the hoops to jump through involved usually in the end users purchasing agreements.

Recently we cut out a reseller and all hell broke loose when the reseller found out. Not worth the risk of losing further business and effectively becoming a competitor.

 

[WaveJumper]

Sorry but don't see anything new it what you are trying to achieve and why would you not want customers to see who manufactured the goods your selling, potential customers are not daft if they are looking for a particular product they are going to shop around anyway.

Would be interesting for @Martin Patfield to expend on the issues he had as a manufacturer with a reseller and why this effected his business

 

[OctopusOnFire]

Depends on your contract with the manufacturer.

Lets assume the supplier has no problem with it... am I allowed to advertise `no label` products?

 

[OctopusOnFire]

Sorry but don't see anything new it what you are trying to achieve and why would you not want customers to see who manufactured the goods your selling, potential customers are not daft if they are looking for a particular product they are going to shop around anyway.

Would be interesting for @Martin Patfield to expend on the issues he had as a manufacturer with a reseller and why this effected his business

I am not entirely excluding the idea of publishing the manufacturers name, however I would like to keep the customer on my shop.
Sometimes looking for a particular product is not as easy, I am not talking about everyday products that we are all used to buying from Amazon and whatnot. Having similar products grouped together in a shop can help a customer save time. Here is an example mouser.co.uk/

 

[OctopusOnFire]

@OctopusOnFire - the problem you have isn’t so much your method of doing business - many others have similar set ups. The big problem is going to be marketing. As you don’t have exclusivity and will almost certainly be more expensive than the competition you need a very strong USP to get any sales.

Good comment.
I am also aware that marketing will be the biggest challenge, but I am optiminstic about it.
Regarding the profit margin, I am playing the long game. Planning to sell at same price as the manufacturer, which means 0 profit. The revenue will hopefully come from complementary services I mentioned in my first post.