Feedback welcome - New business idea
Discussion
Hey everyone,
I am not new to business, investing etc and I am in the position now where some property deals have gone well and I am wanting to step away from my main business role due to various reasons and start something new as a side line business and then continue investing and flipping properties, giving me a bit more freedom. Fortunately I have very few overheads so I dont need to be making a mega income, this will be used as more of a top up.
Having spent 10 years in a sports retail sector/business I know my sector very well, starting from nothing and building up a fairly successful and popular business. By starting this from scratch years ago I have had plenty of up's and downs but eventually after using various suppliers and services found ones which were the best, this ranges from insurance broker/policies, card providers, finance providers and so on.
What I am thinking of doing is offering a package for existing smaller retailers or start up companies in this sector, we will be similar to other organisations where you can join us for a small monthly or annual fee (ball park, £350-£400 per annum seems to be around right) and benefit from a range of services at a discounted rate, and on going support. I have good relationships with people in high up positions in most of the services I would want to offer and I am confident they would take interest, first I would need to gather some interest and just see how many shops might considered it. As a rough guide line I am thinking the below, join us for a small fee and become an 'approved retailer' of our organisation plus;
1) Negotiate with a company such as Shopify to offer these shops an exclusive offer to move to them or create a site.
2) Talk to my existing card suppliers and negotiate deals, I know we can already beat a lot of other banks even on standard rate fees.
3) Offer a retail finance solution for products can be sold on finance, a big incentive and most lenders will only consider bigger shops (£300/400k turnover min) so I would work with one of the biggest lenders and see if by bringing in a bulk number of shops they would consider it, I think they will as I know last year they wanted to get in to this sector. This lender is significantly cheaper than V12, Klarna, Duologi etc and acceptance rates significantly higher, I have used 3-4 lenders over the years and Duologi, Divido etc are terrible (10-15% acceptance) V12 is the market leader but rates are not amazing.
4) Offer business insurance tailed for this sector.
5) Additional insurance offers such as goods in transit incase of any damage, an monthly policy can be about the same as what DHL etc charge to insure just one product as they are all higher value (£1000-£5000+)
6) For the finance option they will need to be FCA registered which can be a pain, luckily my FCA contact would be willing to arrange everything for them cover all reports so they dont need to worry, again for a small optional fee.
Other thoughts;
Contact ADL or Yale and see if they can put an alarm/cctv package together, I know these companies have a lot of leeway so could potentially get a good deal on this. We have suppliers for secure cardboard packaging at much cheaper rate than eBay, Amazon and these have low MOQ so we can help shops with custom boxes and branding. Lastly see if any independent Shopify developers would be interested, for a small fee they could do a few hours work just getting the shops website set up, add a theme, text and integrate the finance option then hand it over, completely optional as most people will be able to do this themselves (except the finance part possibly). There is a lot of ways on how we can help.
It would be an on going thing, we would try to think of new ways to help the business who have signed up and always looking to negotiate and offer new services. Any of the above points which might require other monthly commitments such as FCA support, insurance are optional but would be needed anyway to be honest (such as business insur)
There is approx 2500-3000 shops in the UK in this sector, even if we signed up just 5% intially and tried to increase that over the coming years it might not be a bad earner and I am 100% confident I can save most shops a lot of money per month as I have been there and know the pitfalls. When looking online at about 40-50 sites last night the vast majority were terrible, a few were just 1-2 pages with no shop function, others had 'contact to see whats in stock' and many without any finance options. By getting these companies online with a proper website, shop and payment facilities it could help them massively in a time when I know sales are slowing for people. What we found is a lot of these companies have been there for year, possibly even pass down from father to son and they just haven't followed trend and stuck with a slow moving village or town shop when they have amazing products, contracts which could be earning them so much more.
On the back of the annual fees there is also referral fees for us, we should be able to negotiate and looking online around £50-£70 per customer seems normal? This would be from each supplier and I know the finance lender when I briefly mentioned this were thinking more than that (possible percentage from sales), this could lead to a lot as mentioned the products would range from £1000-£4000+, most of the shops we would target I would expect to be doing about £60k per annum on finance minimum. Once we have signed them up to our platform then they would be given a referral link/number and they arrange the policies directly with the provider so it would be hands off for us from them unless they wanted any assistance but in most cases they would need to go direct.
Apologies for the long email but what are your thoughts?
If you were starting up would you find this beneficial, basically saving time with countless suppliers like I had to until I found the best fit for the industry?
If you were a small shop would you consider moving to new suppliers?
I am not new to business, investing etc and I am in the position now where some property deals have gone well and I am wanting to step away from my main business role due to various reasons and start something new as a side line business and then continue investing and flipping properties, giving me a bit more freedom. Fortunately I have very few overheads so I dont need to be making a mega income, this will be used as more of a top up.
Having spent 10 years in a sports retail sector/business I know my sector very well, starting from nothing and building up a fairly successful and popular business. By starting this from scratch years ago I have had plenty of up's and downs but eventually after using various suppliers and services found ones which were the best, this ranges from insurance broker/policies, card providers, finance providers and so on.
What I am thinking of doing is offering a package for existing smaller retailers or start up companies in this sector, we will be similar to other organisations where you can join us for a small monthly or annual fee (ball park, £350-£400 per annum seems to be around right) and benefit from a range of services at a discounted rate, and on going support. I have good relationships with people in high up positions in most of the services I would want to offer and I am confident they would take interest, first I would need to gather some interest and just see how many shops might considered it. As a rough guide line I am thinking the below, join us for a small fee and become an 'approved retailer' of our organisation plus;
1) Negotiate with a company such as Shopify to offer these shops an exclusive offer to move to them or create a site.
2) Talk to my existing card suppliers and negotiate deals, I know we can already beat a lot of other banks even on standard rate fees.
3) Offer a retail finance solution for products can be sold on finance, a big incentive and most lenders will only consider bigger shops (£300/400k turnover min) so I would work with one of the biggest lenders and see if by bringing in a bulk number of shops they would consider it, I think they will as I know last year they wanted to get in to this sector. This lender is significantly cheaper than V12, Klarna, Duologi etc and acceptance rates significantly higher, I have used 3-4 lenders over the years and Duologi, Divido etc are terrible (10-15% acceptance) V12 is the market leader but rates are not amazing.
4) Offer business insurance tailed for this sector.
5) Additional insurance offers such as goods in transit incase of any damage, an monthly policy can be about the same as what DHL etc charge to insure just one product as they are all higher value (£1000-£5000+)
6) For the finance option they will need to be FCA registered which can be a pain, luckily my FCA contact would be willing to arrange everything for them cover all reports so they dont need to worry, again for a small optional fee.
Other thoughts;
Contact ADL or Yale and see if they can put an alarm/cctv package together, I know these companies have a lot of leeway so could potentially get a good deal on this. We have suppliers for secure cardboard packaging at much cheaper rate than eBay, Amazon and these have low MOQ so we can help shops with custom boxes and branding. Lastly see if any independent Shopify developers would be interested, for a small fee they could do a few hours work just getting the shops website set up, add a theme, text and integrate the finance option then hand it over, completely optional as most people will be able to do this themselves (except the finance part possibly). There is a lot of ways on how we can help.
It would be an on going thing, we would try to think of new ways to help the business who have signed up and always looking to negotiate and offer new services. Any of the above points which might require other monthly commitments such as FCA support, insurance are optional but would be needed anyway to be honest (such as business insur)
There is approx 2500-3000 shops in the UK in this sector, even if we signed up just 5% intially and tried to increase that over the coming years it might not be a bad earner and I am 100% confident I can save most shops a lot of money per month as I have been there and know the pitfalls. When looking online at about 40-50 sites last night the vast majority were terrible, a few were just 1-2 pages with no shop function, others had 'contact to see whats in stock' and many without any finance options. By getting these companies online with a proper website, shop and payment facilities it could help them massively in a time when I know sales are slowing for people. What we found is a lot of these companies have been there for year, possibly even pass down from father to son and they just haven't followed trend and stuck with a slow moving village or town shop when they have amazing products, contracts which could be earning them so much more.
On the back of the annual fees there is also referral fees for us, we should be able to negotiate and looking online around £50-£70 per customer seems normal? This would be from each supplier and I know the finance lender when I briefly mentioned this were thinking more than that (possible percentage from sales), this could lead to a lot as mentioned the products would range from £1000-£4000+, most of the shops we would target I would expect to be doing about £60k per annum on finance minimum. Once we have signed them up to our platform then they would be given a referral link/number and they arrange the policies directly with the provider so it would be hands off for us from them unless they wanted any assistance but in most cases they would need to go direct.
Apologies for the long email but what are your thoughts?
If you were starting up would you find this beneficial, basically saving time with countless suppliers like I had to until I found the best fit for the industry?
If you were a small shop would you consider moving to new suppliers?
iphonedyou said:
If you had to say what the business does in a single sentence, what would that sentence be?
Not to say that a complex model can't make money - obviously! - but if busy small business owners are your market then the proposition needs to be immediately clear.
We did think that, its hard to approach shops online (we will be targeting the whole of the UK) with all of these incentives but keep it short and sweet.Not to say that a complex model can't make money - obviously! - but if busy small business owners are your market then the proposition needs to be immediately clear.
In short, I think in probably every case we will be able to save them money, increase sales and if not already online then we can point them in the right direction and with a nice saving. No sales or marketing BS just pure facts and figures.
It would be very beneficial if we could get the companies to fill in a small Q&A showing us what they currently pay for certain services and there monthly turn over as then we can go back to them and say we can immediately save you X% per month, we know from experience that retail finance increases sales by about 30% so this is something which could automatically boost there sales too. However I dont think many companies would be happy to just hand over certain figures (such as turn over perhaps)? But I think ballpark figure we should be able to save them about 5% per month on card and finance fees, plus additional savings on services.
We also have one other contact with TNT/Fedex, you can no longer get an account with them unless your sending a major amount of parcels but last time we talked to our account manager there was some strings he could pull which meant they were about £10 per parcel cheaper than the only company who currently offer a similar size service (some boxes can be 2m so not many will handle it), so that is another saving we could possibly help with.
There would be a lot of leg work on our part at the beginning but once we confirm everything and can offer these benefits then it could start immediately.
I don't know your market sector but a couple of questions and observations.
1) Shopify has almost 2m web stores so bringing them an extra 150 (5%) probably won't get you in the door, but you could consider having a developer create a template or range of to quickly build up a web presence.
2) Once a business signs up and gets the package why would they continue to pay after, say, the initial year? Again, I don't know your sector so there could be a good reason for a rolling contract.
3) Would you offer support for all the packages you're selling? I.e., if someone had an alarm fitted through your recommended company are you fielding the support calls or are you done and dusted once it's in? This ties into point 2.
It sounds like a valuable assistance package to new businesses but as I see it there's no need to limit yourself to one market segment as this is probably applicable for all SMEs. Best of luck!
1) Shopify has almost 2m web stores so bringing them an extra 150 (5%) probably won't get you in the door, but you could consider having a developer create a template or range of to quickly build up a web presence.
2) Once a business signs up and gets the package why would they continue to pay after, say, the initial year? Again, I don't know your sector so there could be a good reason for a rolling contract.
3) Would you offer support for all the packages you're selling? I.e., if someone had an alarm fitted through your recommended company are you fielding the support calls or are you done and dusted once it's in? This ties into point 2.
It sounds like a valuable assistance package to new businesses but as I see it there's no need to limit yourself to one market segment as this is probably applicable for all SMEs. Best of luck!
Alexandra said:
I don't know your market sector but a couple of questions and observations.
1) Shopify has almost 2m web stores so bringing them an extra 150 (5%) probably won't get you in the door, but you could consider having a developer create a template or range of to quickly build up a web presence.
2) Once a business signs up and gets the package why would they continue to pay after, say, the initial year? Again, I don't know your sector so there could be a good reason for a rolling contract.
3) Would you offer support for all the packages you're selling? I.e., if someone had an alarm fitted through your recommended company are you fielding the support calls or are you done and dusted once it's in? This ties into point 2.
It sounds like a valuable assistance package to new businesses but as I see it there's no need to limit yourself to one market segment as this is probably applicable for all SMEs. Best of luck!
Thanks for the feedback.1) Shopify has almost 2m web stores so bringing them an extra 150 (5%) probably won't get you in the door, but you could consider having a developer create a template or range of to quickly build up a web presence.
2) Once a business signs up and gets the package why would they continue to pay after, say, the initial year? Again, I don't know your sector so there could be a good reason for a rolling contract.
3) Would you offer support for all the packages you're selling? I.e., if someone had an alarm fitted through your recommended company are you fielding the support calls or are you done and dusted once it's in? This ties into point 2.
It sounds like a valuable assistance package to new businesses but as I see it there's no need to limit yourself to one market segment as this is probably applicable for all SMEs. Best of luck!
1) Something like that would be good, Shopify do seem to be quite keen to get people on board and you often see 10%+ offers, I wouldn't be looking to get a huge saving but perhaps 10% off and 3 months free would be a nice set up I think. Then get a developer like you said to quickly set it up for an optional fee. There is also other companies we could try such as Squarespace etc but we can look at the finer details once we start planning. I do know Shopify and Squarespace offer affiliate payments so thats a nice kick back for us too.
2) After the first year they would have to continue the contract for the benefits, so for example the finance company might only work with this shop or offer them the lower rates as part of our subscription/plan, if they cancel that we will notify the lender who will then put them on a higher rate or end their contract for example, we will have to look at the contracts carefully but this is how another subscription service works.
3) We would be there to help with any admin or payment queries but once a service is provided it would be between the shop and provider, for example a card machine stops working, they would contact the provider for help, so we would be hands off a lot of the time.
Initially we would roll it out in the industry I know, I can relate to the shops as I have been them for a number of years and probably used the providers they are using so can relate to them and explain why we changed and who is cheaper but there is option for further development later down the line.
There is one other company in this sector doing something similar (we actually used them for a few years), they offer lots of services but its mostly related to the legal side of things so they help with free legal advice, contracts, h&s, they do have exclusive rates to a finance provider (this is the only reason we joined them and never used any other service the whole time!), I think our service will actually be practical day to day things you use and need, its rare you need legal advice, employment contracts etc but you need lower card fees, alarms/cctv, insurance and so on.
Its all a bit up in the air at the moment, we need to sit down and put pen to paper, have a chat with some providers but I think the groundwork is there for a nice little sideline, for such a small fee per month I think it would be easy to get people on board, even just lowering there card fees from 2.9% to 1.2% for example is a benefit without anything else!
All the offers and deals you mention are available to new retail - no issue getting discounts on shopify / etc. - but having them all in one place and easy to access is an attractive proposition - start up retail in a box.
However, there are elements which raise questions - e.g. you mention building them a shop store - yet only charging £300-£400 p/a? not feasible at that cost - building an eCommerce platform will cost way more than that, even if throwing them onto Shopify - and then they will expect training / support / etc.
concept is good though, just the parameters which need work
However, there are elements which raise questions - e.g. you mention building them a shop store - yet only charging £300-£400 p/a? not feasible at that cost - building an eCommerce platform will cost way more than that, even if throwing them onto Shopify - and then they will expect training / support / etc.
concept is good though, just the parameters which need work
akirk said:
All the offers and deals you mention are available to new retail - no issue getting discounts on shopify / etc. - but having them all in one place and easy to access is an attractive proposition - start up retail in a box.
However, there are elements which raise questions - e.g. you mention building them a shop store - yet only charging £300-£400 p/a? not feasible at that cost - building an eCommerce platform will cost way more than that, even if throwing them onto Shopify - and then they will expect training / support / etc.
concept is good though, just the parameters which need work
Thanks.However, there are elements which raise questions - e.g. you mention building them a shop store - yet only charging £300-£400 p/a? not feasible at that cost - building an eCommerce platform will cost way more than that, even if throwing them onto Shopify - and then they will expect training / support / etc.
concept is good though, just the parameters which need work
A lot of the offers we mention aren't available to start ups unfortunately, possibly Shopify or a card provider offering lower initial rates but we would aim to get an exclusive rate with these providers based on volume. For example no retail finance company (except Klarna perhaps, who are cr4p) wont touch a start up but if we can add them to an existing 'pool' then perhaps we can get there foot in the door.
Same with TNT/Fedex, unless your doing big numbers of parcels you cant get an account, a security alarm system again would be something we can try to negotiate a better deal on by saying we have X amount of companies wanting to sign up rather than just 1 and so on.
I see where your coming from though, we have bounced around supplier for years until we found the right bunch and I hope I can pass this 'package' on to people, save them time and money.
The website is something we need to look in to, I only thought Shopify as it was easy to use.
My plan was to try and get an exclusive discount for new members (its probably not going to be amazing, maybe 10% off set up plus 2-3 free before the monthly payments start) and then they can create there own site, there is tons of guides and videos online or perhaps talk to a developer who could make a generic theme for people to use and pay him XX amount to install it, add any retail finance etc and then hand it back to them to just add products.
That would be a one off fee between the developer and customer but a fee we have negotiated. I honestly dont know Shopify but from what I gather its easy to use so an experienced developer could probably add a theme and some info to a site easily so visually it looks appealing and is ready to go, but this would be optional, some people might want to create there own?
Appreciate the feedback again though, it helps us try and figure things out.
Doofus said:
It sounds like gou're offering a franchise package but without the brand, products or marketing.
I would need to come away from that then.I dont want to make it sounds like this magical package which is going to make you a millionaire!
Just a simple plan which will save you money and hassle, we would want it to read like any other service or product out there. When you go on Shopify, Stripe, Barclays and so on you always have the marketing jargon to get you on board and that all we would aim for. No buy-in costs, no pressure just a simple monthly plan to get our exclusive rates and suppliers.
The main one will be retail finance, its vital in our industry and the bigger players are quite tight. I am hoping my contacts will open a door and if they can then it will be a game changer for a lot of small shops. Like I said Klarna, Duologi, Divido and the likes are worthless, really not worth the hassle for this industry (been there done that, lost tons of sales!), people can learn from my mistakes!
Doofus said:
It sounds like gou're offering a franchise package but without the brand, products or marketing.
We would also have subscriptions available to buy online, we would be cold calling people trying to sell them everything. I think a good website showing all the benefits and a simple sign up is enough, once you get a few reviews on there and word gets around it should help.
I've read your post a couple of times and I haven't really got the foggiest idea what it is you are proposing to do and sell.
My best guess is some kind of financial support package to sports shops?
It's clear from the others who've replied that they know so I fully concede that this is very likely a 'me' problem but regardless, I'd suggest it important that you are able to clearly and succinctly articulate your intent, i.e.....
My best guess is some kind of financial support package to sports shops?
It's clear from the others who've replied that they know so I fully concede that this is very likely a 'me' problem but regardless, I'd suggest it important that you are able to clearly and succinctly articulate your intent, i.e.....
iphonedyou said:
If you had to say what the business does in a single sentence, what would that sentence be?
StevieBee said:
So in short, we would be a subscription type service for companies in the sports sector, either startup or smaller companies.
For a small monthly fee they will have access to website services, insurance, card providers, retail finance, courier firms and more at reduced costs and carefully handpicked by us knowing and having worked with these suppliers that they are highly recommended and will provide a solid service.
We will then throughout the year look at other options and offers we can propose, for example we might get in touch with Yale, ADT etc and see if they can put a package together for an alarm service which might interest shops, or an offer on marketing material (packaging, shop floor products, clothing).
It would be a low fee (imo), approx £40 pm, we will also get a kick back from some suppliers.
I think you might be overlooking existing contracts that your potential customers have, they we will have to exit some/all of those to take advantage of your offering. Since you are offering several services under one umbrella, if the customer already has packages that all have annual reviews in different months, it might not be easy to switch.
Also having a slick website with mail order isn't any good if the customer is not geared up to handle that business, either in stock/cashfow or in manpower to handle online sales.
And finally, many small business owners are very suspicious of people offering 'super deals' especially if they are locked in, in any way. That makes your offering a very much harder sell.
I would suggest that you pick 10-20 potential customers and go and talk to them (nmot on the phone but face to face), and see what their reaction is. It will give you a much better idea of what you are dealing with.
Also having a slick website with mail order isn't any good if the customer is not geared up to handle that business, either in stock/cashfow or in manpower to handle online sales.
And finally, many small business owners are very suspicious of people offering 'super deals' especially if they are locked in, in any way. That makes your offering a very much harder sell.
I would suggest that you pick 10-20 potential customers and go and talk to them (nmot on the phone but face to face), and see what their reaction is. It will give you a much better idea of what you are dealing with.
I've been in the traditional sports retail trade for over fifty years, owning five very successful shops.
Unfortunately the sector is dying on it's feet now, because of:-
a) Online shopping
b) Sports Direct and to a lesser extent JD/Go outdoors.
True, there are a few good ones dotted around the country, but most went ten or more years ago.
Therefore, why limit your idea to them, open it up to any trade.
Good luck, but I think you might find it hard work.
Unfortunately the sector is dying on it's feet now, because of:-
a) Online shopping
b) Sports Direct and to a lesser extent JD/Go outdoors.
True, there are a few good ones dotted around the country, but most went ten or more years ago.
Therefore, why limit your idea to them, open it up to any trade.
Good luck, but I think you might find it hard work.
JCKST1 said:
StevieBee said:
For a small monthly fee they will have access to website services, insurance, card providers, retail finance, courier firms and more at reduced costs and carefully handpicked by us knowing and having worked with these suppliers that they are highly recommended and will provide a solid service.
We will then throughout the year look at other options and offers we can propose, for example we might get in touch with Yale, ADT etc and see if they can put a package together for an alarm service which might interest shops, or an offer on marketing material (packaging, shop floor products, clothing).
It would be a low fee (imo), approx £40 pm, we will also get a kick back from some suppliers.
So it’s a little like the Happy Shopper model where a corner shop owner subscribes to Happy Shopper in return for which they get things like signage, point of sale displays, local advertising, etc.. as well as access to their distribution resources for stock.
I’ve recently completed a project for a County Council which involved captured photo and video content of many independent retailers forming part of a campaign to promote the High Street to local people. Something that (pleasantly) surprised me was just how well so many of these shops were doing – flying in the face of common perceptions about the demise of the High Street. A couple of things come to mind that I think impact on your idea.
Firstly – indy sports retailers. I’ve visited a total 12 towns (and a city) over the past three months and encountered just one such store.... which the owner was in the process of winding down. So I’d agree with this observation:
Wacky Racer said:
Unfortunately the sector is dying on it's feet now
You’d need to broaden the net.From what I have seen, those that are doing well are already doing much of what you are offering themselves so difficult to see where any value could be added.
Those that might benefit are those just ticking along, earning owner a living and little else. But the challenge you have here is that they are unlikely to have the capacity to take advantage of your offer, or desire.
But there will be some and the only way you’ll find these and secure their business is to get out and find them and talk to them.
This brings me to what I think will be your biggest hurdle, namely:
JCKST1 said:
start something new as a side line business
To make this a meaningful endeavour will require focus and energy to levels far greater than what would fall under the category of a side line business. I can see some worth in your idea but to make it work will carry a fair amount of risk and require the level of input I’m not sure you’re willing to give.
JCKST1 said:
akirk said:
All the offers and deals you mention are available to new retail - no issue getting discounts on shopify / etc. - but having them all in one place and easy to access is an attractive proposition - start up retail in a box.
However, there are elements which raise questions - e.g. you mention building them a shop store - yet only charging £300-£400 p/a? not feasible at that cost - building an eCommerce platform will cost way more than that, even if throwing them onto Shopify - and then they will expect training / support / etc.
concept is good though, just the parameters which need work
Thanks.However, there are elements which raise questions - e.g. you mention building them a shop store - yet only charging £300-£400 p/a? not feasible at that cost - building an eCommerce platform will cost way more than that, even if throwing them onto Shopify - and then they will expect training / support / etc.
concept is good though, just the parameters which need work
A lot of the offers we mention aren't available to start ups unfortunately, possibly Shopify or a card provider offering lower initial rates but we would aim to get an exclusive rate with these providers based on volume. For example no retail finance company (except Klarna perhaps, who are cr4p) wont touch a start up but if we can add them to an existing 'pool' then perhaps we can get there foot in the door.
Same with TNT/Fedex, unless your doing big numbers of parcels you cant get an account, a security alarm system again would be something we can try to negotiate a better deal on by saying we have X amount of companies wanting to sign up rather than just 1 and so on.
I see where your coming from though, we have bounced around supplier for years until we found the right bunch and I hope I can pass this 'package' on to people, save them time and money.
The website is something we need to look in to, I only thought Shopify as it was easy to use.
My plan was to try and get an exclusive discount for new members (its probably not going to be amazing, maybe 10% off set up plus 2-3 free before the monthly payments start) and then they can create there own site, there is tons of guides and videos online or perhaps talk to a developer who could make a generic theme for people to use and pay him XX amount to install it, add any retail finance etc and then hand it back to them to just add products.
That would be a one off fee between the developer and customer but a fee we have negotiated. I honestly dont know Shopify but from what I gather its easy to use so an experienced developer could probably add a theme and some info to a site easily so visually it looks appealing and is ready to go, but this would be optional, some people might want to create there own?
Appreciate the feedback again though, it helps us try and figure things out.
- not be interested e.g. TNT will not wish to deal with someone running a couple of packages per month just because you 'introduce' them if they won't deal otherwise...
- offer exactly the discount they would offer to any new customer - they aren't going to do any bigger a deal through you than they would through e.g. FSB etc. - you see this all the time, organisations who offer packages of deals, but in fact you see the same deals everywhere, there are few really good options that you would open up
The reality is that if all you are doing is introducing those companies then the supplier will still have to deal with xxx companies so tehre is no advantage to them to give more discount - if instead you are going to manage all those relationships so that they have one point of contact as supplier, then it might be more advantageous to them and they might give you more discount - meaning that you can offer a better deal, but for a lot of hassle in your having to manage the relationship...
ref. Shopify / website - we do a lot of websites every year, and a reasonable % of those are shopify - simple learning points:
- every customer wants 'that template' (phew this is going to be easy!)
- then they want help setting up the store
- then they want help adding products
- then they decide (99% of them) that the template needs changes (starts to get complex!)
it is never a simple, here is a template, here is the software - off you go... if they are not already doing it themselves, then they are going to want their hand holding throughout, and a lot doing - it will be a lot more expensive than you think - and if all you are doing is introducing them to the developer, why go through you, why not go directly to the developer...
the only reason organisations like this work is if:
- you can give access to something they can't get elsewhere - not convinced that you have that
- you can give knowledge or advice they can't get elsewhere
JCKST1 said:
The main one will be retail finance, its vital in our industry and the bigger players are quite tight. I am hoping my contacts will open a door and if they can then it will be a game changer for a lot of small shops. Like I said Klarna, Duologi, Divido and the likes are worthless, really not worth the hassle for this industry (been there done that, lost tons of sales!), people can learn from my mistakes!
If you are going to lead on this then I'd recommend sounding out your finance companies and their willingness to work with your model.I'm no expert, but I suspect the reason that small retailers and startups can't find finance deals is because the providers consider them to be too great a risk. You acting as an introducer won't change this risk to the finance providers, unless you are planning to underwrite or guarantee the deals somehow.
Thanks for the feedback everyone, here is a break down on replies, hopefully I haven't missed much.
Retail trade vs Online and declining sales:
There is no doubt retail is taking a hit at the moment but its temporary and depending on what way you look at this it could be something a company does now to save costs rather than looking at it as an expense.
I have been on both sides of online and 'normal' retail, the package we would be offering would cover both sides whether you want to use the card systems online or in the shop, insurance covers both etc so we are not targeting just physical shops only.
The trade I am in, which is the cycle industry and higher value goods is steady and once the slump irons itself out it will always be an increasing market due to the continued investment in the industry and cost saving methods for people. Luckily due to this there is not really any huge players like JD and Sports direct who are going to start undercutting people, there is the odd large chain (incl Evans/SD but they target a different audience). There is approx 2500 - 3000 independent shops nationwide. Sales are lower but I am yet to see any shutting down in our region, everyone I know is doing 'okay' as can be, compared to some other sectors who are dropping like flies.
__
The package:
I dont really want to sell this as a marketing package, possibly used the wrong wording saying we would supply marketing material as we wont be doing local adverts for companies, we will of course be promoting them on our site, database, social media but the package is there really to help people save money and get there foot in the door when they might not be able to other wise.
Although we might offer people 10+ features they dont need to use everyone, if they are happy with there card provider or tied in then its no an issue, they might find they can save a couple of hundred per month from just using the courier service option. I mentioned the other similar style company earlier, they offer a load of legal stuff BUT the only thing people are interested in are the finance provider who they have teamed with. We have used them for years and paid monthly purely because they have ONE feature we want, the rest is no use to us. This organisation has 4000 shops and cycle related businesses signed up and to be honest its a dated company, we would be pushing forward and brining things to companies which is needed.
__
Shopify and courier options:
Shopify was an example, we haven't even scratched the surface with this yet but even a small discount might just be helpful to someone but we will look at other options, most companies might have there own site and not want to change and this is not a problem, you can choose what is of interest to you when you sign up, there is no pressure to use our insurance if you like your own.
If the shop wanted it setting up we will need to discuss with a developer some fees, and perhaps offer 2/3 options, ranging from adding the template and text to setting it all up and perhaps managing it, again completely optional and up to the shop.
Courier service, this is something we talked briefly with Fedex/TNT a while ago and they were happy to work with the idea based on volume. They previously used to send bikes and were one of the main companies but when Fedex took over they stopped, the new business manager was saying they are wanting to get back in to the cycling/large parcel side of things but when we needed the account last year they weren't ready so I will go back to them knowing the above and see if they are at that point now.
If you called up today and said you were sending 10-20 parcels per month you would not get a look in, if I can go to them and say we have a group of business who combined will send 100-150 parcels per month and I can push that trade your way with increasing numbers, they might want to link it some how to our new business but not in a financial way then it will peak there interest. To be honest the courier incentive is not going to be hard to do, I know of one larger haulage company who would 100% make an offer but I would prefer either Fedex or DPD as from past experience they have been the best.
__
Finance
The biggest incentive, there is one market leader in this industry now who probably covers about 70% of the shops out there. They will only touch you if you have 500k+ turnover however if you sign up to the other organisation then you get an account regardless (this is what we want to do).
Our initial talks are with a big bank, I wont name them but they offer finance for Asda, Currys and similar companies. They were again keen to get in to the cycling industry, the rate card they showed me was incredibly cheap as a comparison to V12 finance they were up to 6% cheaper (subsidy fee) which when your talking about products worth a few grand is a nice boost. They were thinking of giving us a kick back on the subsidy, so we could say the rate through us is X% and the finance company will give us the difference is what they quoted and the subsidy rate we set for the subscribers so it could be a nice earner if volume was big enough.
They have a min TO of 1m with some flexibility but I know they are keen to tackle some of the bigger players and I am on good terms with the main new business manager who takes a great interest so again this might be a volume thing. I cant offer you a 1m TO shop but I can offer you 3 shops who are doing 1.2m with the potential of adding 5,10,50+ companies long term.
Maybe we will have interest from 10 shops and I can hit them with a TO of 3-4m. Who knows, its all early stages and part of the fun!
_
I think the best thing to do would be to have a chat with some shops, there has been plenty popping up over the last 24-36 months!
Targeting the smaller retailers who are probably doing in the region of 150-500k per year. Basically seeing if we can help, would they be interested and if so what would they be interested in.
The main ones to save money will be courier service for bikes, retail finance, card facilities, the rest are just little incentives and helpful tools for people.
Its early doors as you know, we have some calls next week with companies/industry contacts to float the idea by them and will see how that goes.
The way I look at it is that the other organisation has 4000 members paying monthly, basically for one feature they have. We are just bringing in a modern version of them which is genuinely helpful, maybe 90% of the people will be happy the way they are or not interested but 10% is still a big number to work from and help.
Retail trade vs Online and declining sales:
There is no doubt retail is taking a hit at the moment but its temporary and depending on what way you look at this it could be something a company does now to save costs rather than looking at it as an expense.
I have been on both sides of online and 'normal' retail, the package we would be offering would cover both sides whether you want to use the card systems online or in the shop, insurance covers both etc so we are not targeting just physical shops only.
The trade I am in, which is the cycle industry and higher value goods is steady and once the slump irons itself out it will always be an increasing market due to the continued investment in the industry and cost saving methods for people. Luckily due to this there is not really any huge players like JD and Sports direct who are going to start undercutting people, there is the odd large chain (incl Evans/SD but they target a different audience). There is approx 2500 - 3000 independent shops nationwide. Sales are lower but I am yet to see any shutting down in our region, everyone I know is doing 'okay' as can be, compared to some other sectors who are dropping like flies.
__
The package:
I dont really want to sell this as a marketing package, possibly used the wrong wording saying we would supply marketing material as we wont be doing local adverts for companies, we will of course be promoting them on our site, database, social media but the package is there really to help people save money and get there foot in the door when they might not be able to other wise.
Although we might offer people 10+ features they dont need to use everyone, if they are happy with there card provider or tied in then its no an issue, they might find they can save a couple of hundred per month from just using the courier service option. I mentioned the other similar style company earlier, they offer a load of legal stuff BUT the only thing people are interested in are the finance provider who they have teamed with. We have used them for years and paid monthly purely because they have ONE feature we want, the rest is no use to us. This organisation has 4000 shops and cycle related businesses signed up and to be honest its a dated company, we would be pushing forward and brining things to companies which is needed.
__
Shopify and courier options:
Shopify was an example, we haven't even scratched the surface with this yet but even a small discount might just be helpful to someone but we will look at other options, most companies might have there own site and not want to change and this is not a problem, you can choose what is of interest to you when you sign up, there is no pressure to use our insurance if you like your own.
If the shop wanted it setting up we will need to discuss with a developer some fees, and perhaps offer 2/3 options, ranging from adding the template and text to setting it all up and perhaps managing it, again completely optional and up to the shop.
Courier service, this is something we talked briefly with Fedex/TNT a while ago and they were happy to work with the idea based on volume. They previously used to send bikes and were one of the main companies but when Fedex took over they stopped, the new business manager was saying they are wanting to get back in to the cycling/large parcel side of things but when we needed the account last year they weren't ready so I will go back to them knowing the above and see if they are at that point now.
If you called up today and said you were sending 10-20 parcels per month you would not get a look in, if I can go to them and say we have a group of business who combined will send 100-150 parcels per month and I can push that trade your way with increasing numbers, they might want to link it some how to our new business but not in a financial way then it will peak there interest. To be honest the courier incentive is not going to be hard to do, I know of one larger haulage company who would 100% make an offer but I would prefer either Fedex or DPD as from past experience they have been the best.
__
Finance
The biggest incentive, there is one market leader in this industry now who probably covers about 70% of the shops out there. They will only touch you if you have 500k+ turnover however if you sign up to the other organisation then you get an account regardless (this is what we want to do).
Our initial talks are with a big bank, I wont name them but they offer finance for Asda, Currys and similar companies. They were again keen to get in to the cycling industry, the rate card they showed me was incredibly cheap as a comparison to V12 finance they were up to 6% cheaper (subsidy fee) which when your talking about products worth a few grand is a nice boost. They were thinking of giving us a kick back on the subsidy, so we could say the rate through us is X% and the finance company will give us the difference is what they quoted and the subsidy rate we set for the subscribers so it could be a nice earner if volume was big enough.
They have a min TO of 1m with some flexibility but I know they are keen to tackle some of the bigger players and I am on good terms with the main new business manager who takes a great interest so again this might be a volume thing. I cant offer you a 1m TO shop but I can offer you 3 shops who are doing 1.2m with the potential of adding 5,10,50+ companies long term.
Maybe we will have interest from 10 shops and I can hit them with a TO of 3-4m. Who knows, its all early stages and part of the fun!
_
I think the best thing to do would be to have a chat with some shops, there has been plenty popping up over the last 24-36 months!
Targeting the smaller retailers who are probably doing in the region of 150-500k per year. Basically seeing if we can help, would they be interested and if so what would they be interested in.
The main ones to save money will be courier service for bikes, retail finance, card facilities, the rest are just little incentives and helpful tools for people.
Its early doors as you know, we have some calls next week with companies/industry contacts to float the idea by them and will see how that goes.
The way I look at it is that the other organisation has 4000 members paying monthly, basically for one feature they have. We are just bringing in a modern version of them which is genuinely helpful, maybe 90% of the people will be happy the way they are or not interested but 10% is still a big number to work from and help.
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