Question for everyone - opinions please
Discussion
Apologies for my lenth (except to women) Im after a few opinions.
My company has the ability to:
1) design webdesites, database driven ecommerce structuers, etc etc
2) Get websites ranking at the top of google, for specific phrases
I decided a long time ago, that I would find business partners, people who had their own businesses, who would agree to give me a fixed percentage of the profits they made through business I generated for them, via search engine optimisation.
Advantage to me: my input and time invested is minimal, as I simply instruct my staff to achieve xy and z. Im not greedy, and like the idea of having multiple sources of residual income, which doesnt require labour on my part.
Two of the companies I am going into business with sell jewlery. Negotiations have begun with the first one, and we have decided to statr off with just one website, marketing/selling plain wedding bands. The company I am partnering with is a long standing and successful business, have been in business for decades, and are offering the following terms.
1) Joint ownership of website/domain name. My job is to design it, and ensure it ranks at the top of google for key phrases.
2) 5% of the gross (for me) on turnover up to 250k, and 3% thereafter.
Im slightly out of my depth when it comes to appreciating percentages. Not only would we have to turn over a significant amount of money for my profits to be anything but meagre (and only time will tell) but is 3% not an overly unyielding offer? I appreciate the need, in theory, to purchase new manufacturing eqiupment IF the business does grow successfully in time, but there is no risk to either of us. We will both start by operating out of our current premises, there are no extra overheads, I will simply ensure that they receive a new flow of orders. Which in time, I hope, will increase.
I know very little about retail, negotiations are in the early stages and I have not yet done any research, but does anyone have any comments on my 5 and 3 percent margins on the gross?
I appreciate that the retail market is both aggressive and cutthroat, and that prospective internet buyers are often are just looking for the best price, but surely it is not entirely necessary to insist someone in my position should accept as little as 3% of the gross, on turnover above £250k?
Yes I know, I will not be responsible for returns, resizings, packing and shipping, staff and labour, losses incured by fluctuations in gold prices, future premises etc... and yes my percentage is of the gross which is good - but when it comes to the internet, one might be able to increase prices by as little as 2%, and hope to regain lost business from price shoppers by developing a more intuitive user interface, a better more professional looking site, an easier to navigate and more relaxed online browsing experience, by focussing on developing a suitable and appropriate shopping experience which, as much as possible, is better than that of the competition.
Its not 'quite' the same as selling tv's like derestrictor, where the exact same product, complete with model number and tech specs, can be purchased in any good retail outlet on highstreets up and down the country.
As I have said, retail is not really my game, and although Im could be wrong, I dont feel that being offered 3% of the gross on sales above 250k is entirely... necessary, is it? In order for us to do business that is. Im the one who will ensure we have a steady flow of business, and Im also the one who is free to pick and choose, when it comes to finding a suitable business partner.
Comments on the retail market, and percentages?
My company has the ability to:
1) design webdesites, database driven ecommerce structuers, etc etc
2) Get websites ranking at the top of google, for specific phrases
I decided a long time ago, that I would find business partners, people who had their own businesses, who would agree to give me a fixed percentage of the profits they made through business I generated for them, via search engine optimisation.
Advantage to me: my input and time invested is minimal, as I simply instruct my staff to achieve xy and z. Im not greedy, and like the idea of having multiple sources of residual income, which doesnt require labour on my part.
Two of the companies I am going into business with sell jewlery. Negotiations have begun with the first one, and we have decided to statr off with just one website, marketing/selling plain wedding bands. The company I am partnering with is a long standing and successful business, have been in business for decades, and are offering the following terms.
1) Joint ownership of website/domain name. My job is to design it, and ensure it ranks at the top of google for key phrases.
2) 5% of the gross (for me) on turnover up to 250k, and 3% thereafter.
Im slightly out of my depth when it comes to appreciating percentages. Not only would we have to turn over a significant amount of money for my profits to be anything but meagre (and only time will tell) but is 3% not an overly unyielding offer? I appreciate the need, in theory, to purchase new manufacturing eqiupment IF the business does grow successfully in time, but there is no risk to either of us. We will both start by operating out of our current premises, there are no extra overheads, I will simply ensure that they receive a new flow of orders. Which in time, I hope, will increase.
I know very little about retail, negotiations are in the early stages and I have not yet done any research, but does anyone have any comments on my 5 and 3 percent margins on the gross?
I appreciate that the retail market is both aggressive and cutthroat, and that prospective internet buyers are often are just looking for the best price, but surely it is not entirely necessary to insist someone in my position should accept as little as 3% of the gross, on turnover above £250k?
Yes I know, I will not be responsible for returns, resizings, packing and shipping, staff and labour, losses incured by fluctuations in gold prices, future premises etc... and yes my percentage is of the gross which is good - but when it comes to the internet, one might be able to increase prices by as little as 2%, and hope to regain lost business from price shoppers by developing a more intuitive user interface, a better more professional looking site, an easier to navigate and more relaxed online browsing experience, by focussing on developing a suitable and appropriate shopping experience which, as much as possible, is better than that of the competition.
Its not 'quite' the same as selling tv's like derestrictor, where the exact same product, complete with model number and tech specs, can be purchased in any good retail outlet on highstreets up and down the country.
As I have said, retail is not really my game, and although Im could be wrong, I dont feel that being offered 3% of the gross on sales above 250k is entirely... necessary, is it? In order for us to do business that is. Im the one who will ensure we have a steady flow of business, and Im also the one who is free to pick and choose, when it comes to finding a suitable business partner.
Comments on the retail market, and percentages?
I think the gross turnover percentage is the only real way to go as working things out net just get too difficult.
If I have read your post properly though it seems that you are doing all the work in getting in the new business, and thus all the risk if the venture doesnt return.
That said, 5% would be quite low. I think that is more like a speculative opening offer. For example, what they are saying is:
"Please invest thousand of pounds of your businesses money for us to have half ownership. For all of the business you generate for us we get 95% you get 5%...
Oh yeah if you make us really rich and you bring us in more than a quarter of a mil, then after that we get 97%."
Of course, they may be working on a 50% margin or even a 20% margin, but you are giving them free business that they otherwise would not have - and business you could even give to a competitor!
To be quite frank - if it were me and someone appraoched me and could bring me free business and was willing to put 100% of the time and effort of bringing the sales inI would expect their starting negotiations to start at 50% of net. After all 50% of something is a lot better than 100% of nothing at all.
If you add into the equation that their competitors are already forging ahead with internet sales then the effect that a good site on their business is more than just the turnover - its also the market share.
If they need to restructure their prices to cover your costs then fair enough, but I would be looking at a minimum of 10% - maybe even more to make it worthwhile. If your product and service is good, shop around for an 'exclusive deal'. Its a good idea as it is a no-brainer for the jewellers - you are taking all the risk for them - you can afford to be hardball with the prices.
If I have read your post properly though it seems that you are doing all the work in getting in the new business, and thus all the risk if the venture doesnt return.
That said, 5% would be quite low. I think that is more like a speculative opening offer. For example, what they are saying is:
"Please invest thousand of pounds of your businesses money for us to have half ownership. For all of the business you generate for us we get 95% you get 5%...
Oh yeah if you make us really rich and you bring us in more than a quarter of a mil, then after that we get 97%."
Of course, they may be working on a 50% margin or even a 20% margin, but you are giving them free business that they otherwise would not have - and business you could even give to a competitor!
To be quite frank - if it were me and someone appraoched me and could bring me free business and was willing to put 100% of the time and effort of bringing the sales inI would expect their starting negotiations to start at 50% of net. After all 50% of something is a lot better than 100% of nothing at all.
If you add into the equation that their competitors are already forging ahead with internet sales then the effect that a good site on their business is more than just the turnover - its also the market share.
If they need to restructure their prices to cover your costs then fair enough, but I would be looking at a minimum of 10% - maybe even more to make it worthwhile. If your product and service is good, shop around for an 'exclusive deal'. Its a good idea as it is a no-brainer for the jewellers - you are taking all the risk for them - you can afford to be hardball with the prices.
I cannot speak for the gold and silver markets.
But if you got me upto £250k worth of sales from my website in a year ( www.waterblaster.eu ) I would be offering you 25% and anything above £250k I would offer you 20% (Of profit only)
you ust remember it is also about the profit on each item, some rings (wedding bands) can make as little as £5 on an £80 ring so 3% would not be a lot and neither would 10%
but that is just me.
But if you got me upto £250k worth of sales from my website in a year ( www.waterblaster.eu ) I would be offering you 25% and anything above £250k I would offer you 20% (Of profit only)
you ust remember it is also about the profit on each item, some rings (wedding bands) can make as little as £5 on an £80 ring so 3% would not be a lot and neither would 10%
but that is just me.
I agree with everything you have said Justin, and talks (they were talks before they became negotiations, we established interest, agreed we had good reason to work together) ... talks were talks. All seemed good.
Not that negotiations have begun, I am led to believe that 5% is a huge stake, after all of the considerable costs have been taken into account. Initially I suggested 25% of the gross (and yes, of the gross is much better, as I know exactly how much is turned over, day by day, week on week, etc) - I do get the impression they are fearful of not knowing what profits will be on an internet based business, having never had one before, hence they are pushing for greater margins.
Its tough for me - whilst I appreciate that negotiations should be drawn out, with every man fighting for his corner for what is negotiated is all what one will get, but having so very little experience in retail, im unsure as to whether there are any genuine grounds for needing to reduce my margin above 250k. I dont think so. The more money a business makes, the more able it is (usually) to increase its profit margin, depending on the nature of the business of course
I wonder if there are any jewlers on PH I could seek guidance from...
Not that negotiations have begun, I am led to believe that 5% is a huge stake, after all of the considerable costs have been taken into account. Initially I suggested 25% of the gross (and yes, of the gross is much better, as I know exactly how much is turned over, day by day, week on week, etc) - I do get the impression they are fearful of not knowing what profits will be on an internet based business, having never had one before, hence they are pushing for greater margins.
Its tough for me - whilst I appreciate that negotiations should be drawn out, with every man fighting for his corner for what is negotiated is all what one will get, but having so very little experience in retail, im unsure as to whether there are any genuine grounds for needing to reduce my margin above 250k. I dont think so. The more money a business makes, the more able it is (usually) to increase its profit margin, depending on the nature of the business of course
I wonder if there are any jewlers on PH I could seek guidance from...
ukbob,
The reason for the variance at £250k would be to move to the next level, I would assume they believe they can cope with any orders upto £250k,howevery, above the £250k they would need to employ another person or 2 to cope with demand, thus reducing the profit and so on...
Also as with any website there is no guarantee of a sale, as Iam sure you are aware, if the price is wrong, the goods are no good etc.....they more than likely know that for every 5 people who walk in off the street they will sell too, with a website is is more than likely 1 in every 200, scary if you don't know so this can put people off as well which is why they maybe reducing their margin to you.
Good Luck though
The reason for the variance at £250k would be to move to the next level, I would assume they believe they can cope with any orders upto £250k,howevery, above the £250k they would need to employ another person or 2 to cope with demand, thus reducing the profit and so on...
Also as with any website there is no guarantee of a sale, as Iam sure you are aware, if the price is wrong, the goods are no good etc.....they more than likely know that for every 5 people who walk in off the street they will sell too, with a website is is more than likely 1 in every 200, scary if you don't know so this can put people off as well which is why they maybe reducing their margin to you.
Good Luck though
martin hunt said:
I cannot speak for the gold and silver markets.
But if you got me upto £250k worth of sales from my website in a year ( www.waterblaster.eu ) I would be offering you 25% and anything above £250k I would offer you 20% (Of profit only)
you ust remember it is also about the profit on each item, some rings (wedding bands) can make as little as £5 on an £80 ring so 3% would not be a lot and neither would 10%
but that is just me.
I assume you mean 3% would be a lot, if profit was as low as a fiver on an £80 ring. But if you got me upto £250k worth of sales from my website in a year ( www.waterblaster.eu ) I would be offering you 25% and anything above £250k I would offer you 20% (Of profit only)
you ust remember it is also about the profit on each item, some rings (wedding bands) can make as little as £5 on an £80 ring so 3% would not be a lot and neither would 10%
but that is just me.
As for the water blaster, its a seasonal product which needs marketing, the benefits of which might be reaped via the retail chains? SEO works well for products which are already mainstream, ideally generic (not specific, like mobile phone models and makes) and in demand, its simply a case of achieving a higher ranking than the competition in the organic listings.
martin hunt said:
ukbob,
The reason for the variance at £250k would be to move to the next level, I would assume they believe they can cope with any orders upto £250k,howevery, above the £250k they would need to employ another person or 2 to cope with demand, thus reducing the profit and so on...
Also as with any website there is no guarantee of a sale, as Iam sure you are aware, if the price is wrong, the goods are no good etc.....they more than likely know that for every 5 people who walk in off the street they will sell too, with a website is is more than likely 1 in every 200, scary if you don't know so this can put people off as well which is why they maybe reducing their margin to you.
Good Luck though
I hear what you say, and its very much in line with what they are saying. My view though, is that every company should be spending a minimum of 5% of their turnover on advertising. Even if I did get 3% of 250k, its not much of a marketing budget is it, and leaves no room for my own profit. The reason for the variance at £250k would be to move to the next level, I would assume they believe they can cope with any orders upto £250k,howevery, above the £250k they would need to employ another person or 2 to cope with demand, thus reducing the profit and so on...
Also as with any website there is no guarantee of a sale, as Iam sure you are aware, if the price is wrong, the goods are no good etc.....they more than likely know that for every 5 people who walk in off the street they will sell too, with a website is is more than likely 1 in every 200, scary if you don't know so this can put people off as well which is why they maybe reducing their margin to you.
Good Luck though
Ive learned that everything is pie in the sky until the money has come in though, and hopes of earning a minimum of 250k are just that, merely hopes. Only time would tell. I think I should approach jewlers, put the story to them, and hope to find a friendly one who wont see me as a threat and share his wisdom which might help negotiations.
I noticed you didn't offer us this option. 
Basically these sales are not costing the company anything but the percentage you take. Our sales and marketing spend is between 15-20% of turnover so every £1 of revenue costs 15-20 pence. I estimate that if you did a poll of everyone who runs a business on PH the majority would come in at between 10 and 20%. Very few sizable businesses would be 5% or under.
So working on that theory their offer is far too low. I would look for a minimum of 15%.
Speak soon.
Basically these sales are not costing the company anything but the percentage you take. Our sales and marketing spend is between 15-20% of turnover so every £1 of revenue costs 15-20 pence. I estimate that if you did a poll of everyone who runs a business on PH the majority would come in at between 10 and 20%. Very few sizable businesses would be 5% or under.
So working on that theory their offer is far too low. I would look for a minimum of 15%.
Speak soon.
I had a similar agreement with a client (natural cosmetics manufacturer) a few years ago. All very informal but I took 7.5% on turnover.
It worked out well for both of us, it allowed them to see the potential of the internet in a win-win way, I got a nice steady income from it and one of my first clients.
Now it's a couple of years since we started and I recently suggested that we finish the agreement due to a conflict of interests (commission is now fairly insignificant compared to my other income from the client).
My client was a man of his word type and it was a nice deal, but it can be pretty complex and there are quite a few possible pitfalls (which I'm sure you've probably thought of)
Who pays for card processing fees? He might just be expecting a list of orders and the money, even if its just the extra charge over a regular CNP transaction it could well eat into your 5%.
How long does the relationship last? Getting a % of the ownership of domain is a good move but nothing to stop him supplying the site if he chooses and paying someone else to create a new site for him once the concepts proved rather then pay you. If he's advertising the site himself he might not see it so clearly as you bringing in the custom.
It can be a great model for all but it's important to get at least the main points written in stone.
It worked out well for both of us, it allowed them to see the potential of the internet in a win-win way, I got a nice steady income from it and one of my first clients.
Now it's a couple of years since we started and I recently suggested that we finish the agreement due to a conflict of interests (commission is now fairly insignificant compared to my other income from the client).
My client was a man of his word type and it was a nice deal, but it can be pretty complex and there are quite a few possible pitfalls (which I'm sure you've probably thought of)
Who pays for card processing fees? He might just be expecting a list of orders and the money, even if its just the extra charge over a regular CNP transaction it could well eat into your 5%.
How long does the relationship last? Getting a % of the ownership of domain is a good move but nothing to stop him supplying the site if he chooses and paying someone else to create a new site for him once the concepts proved rather then pay you. If he's advertising the site himself he might not see it so clearly as you bringing in the custom.
It can be a great model for all but it's important to get at least the main points written in stone.
UKBob said:
I decided a long time ago, that I would find business partners, people who had their own businesses, who would agree to give me a fixed percentage of the profits they made through business I generated for them, via search engine optimisation.
Comments on the retail market, and percentages?
Comments on the retail market, and percentages?
The key words above are : Their own business;
I see it as a good deal for you. I would never negotiate on a % of my business profits via a 'new' medium of advertising.
I would always go for a fixed fee for a service provided. They are taking all the risks, stock, staff, good will, returns etc.
Whats in it for them for it being open ended? Clearly you have your fees for doing this service and a support role and costs for the future.
So If you can get any % I would grab it. Perhaps you could get a fee for doing the work and a % fee perhaps. Short term overheads covered by the fixed fee, long term profit from the % rate.
Good luck
Edited by superlightr on Wednesday 24th January 11:18
superlightr said:
UKBob said:
I decided a long time ago, that I would find business partners, people who had their own businesses, who would agree to give me a fixed percentage of the profits they made through business I generated for them, via search engine optimisation.
Comments on the retail market, and percentages?
Comments on the retail market, and percentages?
The key words above are : Their own business;
I see it as a good deal for you. I would never negotiate on a % of my business profits via a 'new' medium of advertising.
I would always go for a fixed fee for a service provided. They are taking all the risks, stock, staff, good will, returns etc.
Whats in it for them for it being open ended? Clearly you have your fees for doing this service and a support role and costs for the future.
So If you can get any % I would grab it. Perhaps you could get a fee for doing the work and a % fee perhaps. Short term overheads covered by the fixed fee, long term profit from the % rate.
Good luck
Edited by superlightr on Wednesday 24th January 11:18
I have to disagree with this.
I think that the OPs main selling point is that they are doing all of the work and taking all of the risk in investing in the construction of the site. The sales are being handed to the company on a silver platter for zero risk.
As a company owner myself I have turned down tons of flat rate marketing schemes - as there is no guarantee of even breaking even. The OPs business model I think is excellent - and undervalued.
I think the jewellery company may have put out their offer as a purposefully low 'opening gambit'. They know that this wont be accepted but opens negotiations on the right side of the table so it looks like they have moved a lot. An example of this is when the fire service demanded a 40% pay rise... If they then drop to 20% it looks like they have moved a lot.
On the other hand i think they also may have been shortsighted. They have lost of the fact that all of this new business they wouldnt have had anyway if the OPs company was not there - instead they are thinking "S***, in the first year we might be paying out £20,000". But of course, 90% of £1,000,000 is a lot more profit than 100% of £500,000. Similarly with the percentage reducing over £250,000... They are thinking about the bottom line on what they are paying out, but to UKBob its like: "OK, so if I make you money I get 5%, but when I make you loads of money more I get a smaller percent!?" - if anything it should be a higher percent as it is they who are benefitting from the huge majority of the profit *and* the economies of scale in that they can buy in bulk etc - yet UKBob is getting the diseconomies of scale in that the site hosting etc will cost more.
I think that UKBob shoudl not lose sight of the fact that he is offering an excellent prospect, one which will be snapped up by any company with an internet sellable product but does not have an internet site.
Look at it this way... is it really 'their business' you are expanding?
Or is it your business that *they* are supplying good through your retail outlet?
You are running the site, and taking all the risk... why dont you offer them a deal where you will get the business in, and they have a contract to supply the goods? In practice the two deals are no different - but of course if it were your business that they were bidding to supply your margin would be a hell of a lot more than 5%!?
The other way to explain it do them in 'their terms' would be how much would it cost to expand their business through another retail shop? As well as the start up costs, there are overheads such as rent, business rates, utilities, transporting stock to it, and of course staff to sit a lot of the day waiting for customers?
What kind of percentage overhead is that? 30%, 40%, 50% - more if the shop doesnt turnover enough sales. They are offering you 5% to take all the risk...
T4R said:
I think you need to evaluate the following;
What's the cost to UKBoB Inc. ?
What's the risk to UKBob Inc. ?
And finally: what would Bernie Ecclestone do in this situation...?
What's the cost to UKBoB Inc. ?
What's the risk to UKBob Inc. ?
And finally: what would Bernie Ecclestone do in this situation...?
Bernie Ecclestone would make sure that the first two points were adequately covered then ignore these as a costing basis for the customer.
He made his money from the guarantee he could make more for other businesses if they worked with him - despite the exportionate profits he made.
They had the choice of working with him and making the money, or not working with him and missing out. UKBob should have the similar viewpoint.
Another example about ignoring the cost of a service and realising the result is more important:
Whats better, an accountant who charges £1000 an hour and saves you £10,000 off your tax bill for three hours work?
Or one that worked for three days at £50 an hour to save you £2000?
A shortsighted company would opt for the second one to keep their costs down!
I think you are looking at this the wrong way..
I presume they have a business plan? Ask to see it.
Work out whay you think they will be worth in xx years and how much your services will cost v's ongoing and setup fees then askfor a suitable amount of equity in the business.
I suspect it might be more than 5% then again a small e-commerce site and SEO are not going to cost you a lot....
Be careful
D
I presume they have a business plan? Ask to see it.
Work out whay you think they will be worth in xx years and how much your services will cost v's ongoing and setup fees then askfor a suitable amount of equity in the business.
I suspect it might be more than 5% then again a small e-commerce site and SEO are not going to cost you a lot....
Be careful
D
greenie said:
I noticed you didn't offer us this option.
They didnt poke fun at my cerbera, for being yellow greenie said:
Basically these sales are not costing the company anything but the percentage you take. Our sales and marketing spend is between 15-20% of turnover so every £1 of revenue costs 15-20 pence. I estimate that if you did a poll of everyone who runs a business on PH the majority would come in at between 10 and 20%. Very few sizable businesses would be 5% or under.
So working on that theory their offer is far too low. I would look for a minimum of 15%.
Speak soon.
Even im sure 15% would be too high, the online retail market doesnt always allow for big margins on mainstream products, the trouble is gold has a market value per ounce, and punters know exactly what they are buying, hence they are able to price match. Not quite the same as selling TV's, but not quite pat testing either. So working on that theory their offer is far too low. I would look for a minimum of 15%.
Speak soon.
rpguk said:
Who pays for card processing fees?
How long does the relationship last?
...it's important to get at least the main points written in stone.
The contract will have to be watertight, and will state that we both jointly own the website and domain name, and cant trade without the other, without consent in writing. Only time will tell, but I cant see any pitfalls, other than us both having to walk away over a conflict of interest, which I hope will never happen. Being in the web design game, I speak to new companies all the time, and hearing about other peoples conflicts of interest is very very common. This is why I wanted to own the site/domain, the fact that I retained ownership was the basis for any discussion, and at the last minute in attempts to protect their own interests, they insist that its jointly owned. I dont blame them, I could afterall walk away with my marketing engine at any point, at least they are serious about making a go of this. Still chewing it over. How long does the relationship last?
...it's important to get at least the main points written in stone.
Justin, Ive read your post, and will give all of the points you raised some more thought, after Ive done the necessary and found out more about margins in the ecom jewlery trade, something I think I must do before trying to make any more decisions.
T4R said:
I think you need to evaluate the following;
What's the cost to UKBoB Inc. ?
What's the risk to UKBob Inc. ?
And finally: what would Bernie Ecclestone do in this situation...?
I was once asked to log into an account I set up for a client, to check if there was any news from bernie himself. There was, but thinking Id never need to email Mr Ecclestone, I failed to make a note of his email address What's the cost to UKBoB Inc. ?
What's the risk to UKBob Inc. ?
And finally: what would Bernie Ecclestone do in this situation...?
This is just a standard web affiliate deal witha twist, in that you share ownership of the site.
The markup on jewellery is 300% due in part to the length of time an item might sit in stock. Many years ago I ran a small internet jewellery business.
Due to the large margins available then commision should be must higher. I've just checked one of the many affilaite networks in this case Buy.at and found Goldsmiths - here's there terms for a click through that lands on there site and then results in a purchase
Goldsmiths is the largest high quality jewellery retailer in the UK. The company has been trading since 1778, and by the end of 2005 will offer over 170 high street showrooms in the UK.
Having a wide range of classic and contemporary designs to promote, all of exceptional quality and design, with Goldsmiths you are partnering with one the countries most prestigious retailers of jewellery.
Did you know? …
Goldsmiths designed and made many if the famous sporting trophies and cups, including the FA Cup.
Goldsmiths has the largest distribution network of Omega, Oris and TAG.
The Goldsmiths affiliate programme offers one of the highest commission payouts available within this sector. Tiers are as follows: £1 - £999 sales per month = 12%
£1000 - £2499 = 14%
£2500 - £4999 = 16%
£5000 - £9999 = 18%
£10,000+ = 20%
Goldsmiths offers a 30-day returns policy therefore sales will remain in pending for at least 30 days.
While progression through commission levels is initially dependent on monthly gross sales, owing to the possibility of occasional large-value returns (a £5000 ring, for instance), average net sales will be used over time to determine appropriate commission levels.
If I was building the entire site and the e-commerce system then I would expect more than the 20% offered by Goldsmith.
Cheers
John
The markup on jewellery is 300% due in part to the length of time an item might sit in stock. Many years ago I ran a small internet jewellery business.
Due to the large margins available then commision should be must higher. I've just checked one of the many affilaite networks in this case Buy.at and found Goldsmiths - here's there terms for a click through that lands on there site and then results in a purchase
Goldsmiths is the largest high quality jewellery retailer in the UK. The company has been trading since 1778, and by the end of 2005 will offer over 170 high street showrooms in the UK.
Having a wide range of classic and contemporary designs to promote, all of exceptional quality and design, with Goldsmiths you are partnering with one the countries most prestigious retailers of jewellery.
Did you know? …
Goldsmiths designed and made many if the famous sporting trophies and cups, including the FA Cup.
Goldsmiths has the largest distribution network of Omega, Oris and TAG.
The Goldsmiths affiliate programme offers one of the highest commission payouts available within this sector. Tiers are as follows: £1 - £999 sales per month = 12%
£1000 - £2499 = 14%
£2500 - £4999 = 16%
£5000 - £9999 = 18%
£10,000+ = 20%
Goldsmiths offers a 30-day returns policy therefore sales will remain in pending for at least 30 days.
While progression through commission levels is initially dependent on monthly gross sales, owing to the possibility of occasional large-value returns (a £5000 ring, for instance), average net sales will be used over time to determine appropriate commission levels.
If I was building the entire site and the e-commerce system then I would expect more than the 20% offered by Goldsmith.
Cheers
John
johnbear said:
This is just a standard web affiliate deal witha twist, in that you share ownership of the site.
The markup on jewellery is 300% due in part to the length of time an item might sit in stock. Many years ago I ran a small internet jewellery business.
Due to the large margins available then commision should be must higher. I've just checked one of the many affilaite networks in this case Buy.at and found Goldsmiths - here's there terms for a click through that lands on there site and then results in a purchase
Goldsmiths is the largest high quality jewellery retailer in the UK. The company has been trading since 1778, and by the end of 2005 will offer over 170 high street showrooms in the UK.
Having a wide range of classic and contemporary designs to promote, all of exceptional quality and design, with Goldsmiths you are partnering with one the countries most prestigious retailers of jewellery.
Did you know? …
Goldsmiths designed and made many if the famous sporting trophies and cups, including the FA Cup.
Goldsmiths has the largest distribution network of Omega, Oris and TAG.
The Goldsmiths affiliate programme offers one of the highest commission payouts available within this sector. Tiers are as follows: £1 - £999 sales per month = 12%
£1000 - £2499 = 14%
£2500 - £4999 = 16%
£5000 - £9999 = 18%
£10,000+ = 20%
Goldsmiths offers a 30-day returns policy therefore sales will remain in pending for at least 30 days.
While progression through commission levels is initially dependent on monthly gross sales, owing to the possibility of occasional large-value returns (a £5000 ring, for instance), average net sales will be used over time to determine appropriate commission levels.
If I was building the entire site and the e-commerce system then I would expect more than the 20% offered by Goldsmith.
Cheers
John
The markup on jewellery is 300% due in part to the length of time an item might sit in stock. Many years ago I ran a small internet jewellery business.
Due to the large margins available then commision should be must higher. I've just checked one of the many affilaite networks in this case Buy.at and found Goldsmiths - here's there terms for a click through that lands on there site and then results in a purchase
Goldsmiths is the largest high quality jewellery retailer in the UK. The company has been trading since 1778, and by the end of 2005 will offer over 170 high street showrooms in the UK.
Having a wide range of classic and contemporary designs to promote, all of exceptional quality and design, with Goldsmiths you are partnering with one the countries most prestigious retailers of jewellery.
Did you know? …
Goldsmiths designed and made many if the famous sporting trophies and cups, including the FA Cup.
Goldsmiths has the largest distribution network of Omega, Oris and TAG.
The Goldsmiths affiliate programme offers one of the highest commission payouts available within this sector. Tiers are as follows: £1 - £999 sales per month = 12%
£1000 - £2499 = 14%
£2500 - £4999 = 16%
£5000 - £9999 = 18%
£10,000+ = 20%
Goldsmiths offers a 30-day returns policy therefore sales will remain in pending for at least 30 days.
While progression through commission levels is initially dependent on monthly gross sales, owing to the possibility of occasional large-value returns (a £5000 ring, for instance), average net sales will be used over time to determine appropriate commission levels.
If I was building the entire site and the e-commerce system then I would expect more than the 20% offered by Goldsmith.
Cheers
John
Completely agreed. My gut reaction for UKBob was 25-30% - the reason why Goldsmiths are happy to have affiliates is that to make a sale otherwise they still have to cover expensive shop overheads. With affiliate programs people are bringing them sale on a commission only basis its a win/win for both parties.
For those that are intersted, the deal fell appart.
In short, I began to like them less and less, and everything else aside, if you begin to dislike someone you are going to be going into business with, then you shouldnt really be going into business with them in the first place.
Conversations got unnecessarily heated from their end, and whilst Im no stranger to negotiation, they werent really negotiating, I endured more of a one sided "This is how its going to be, or nothing" monalogue. Bit too forceful for my liking. They became the issue, not the margins.
When I finally admitted to myself that I didnt really want to do business with them, I sent off my last few emails, eventually got a reply - they didnt either. Which is good imho. Better to have tested the waters than to have never dipped ones toe.
In short, I began to like them less and less, and everything else aside, if you begin to dislike someone you are going to be going into business with, then you shouldnt really be going into business with them in the first place.
Conversations got unnecessarily heated from their end, and whilst Im no stranger to negotiation, they werent really negotiating, I endured more of a one sided "This is how its going to be, or nothing" monalogue. Bit too forceful for my liking. They became the issue, not the margins.
When I finally admitted to myself that I didnt really want to do business with them, I sent off my last few emails, eventually got a reply - they didnt either. Which is good imho. Better to have tested the waters than to have never dipped ones toe.
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