Forum Discussion

Airborne's avatar
Airborne
Contributor 2
2 months ago

Opportunity strikes?

I live in a rapid growing area. New construction and gentrification are in high gear. Raw building materials are in high demand.

I have an opportunity to be a representative for a wall material that is 1/3 cost of the leading manufacturer. 

My options are: 

Ship Direct to customer:

Maintain a showroom with adequate stock

Truck Load. 1-3 a Month

Profit margins are based on the three options. 

 

I have zero infrastructure to handle, receive, store, ship this material. I think I can find the resources rather quickly.

I would love to provide a cheaper solution to my region and still make money.

Anyone become a rep for materials? Is so, at what of the three levels proposed? 

Which is the most profitable? Ship to client? Showroom/storage? Showroom Storage and 1-3 Trailers a month?

 

business advice
professional development
  • ryaantuttle's avatar
    ryaantuttle
    Jobber Ambassador
    30 days ago

    I suggest reading "The Goal" by Eliyahu M. Goldratt before making any moves. Sounds like the overhead & inventory could crush the 1/2 of cost deal if things don't move quickly enough. Airborne 

  • Airborne's avatar
    Airborne
    Contributor 2
    31 days ago

    Much appreciate the well thought out reasons! 
    I’m going to say yes to the universe and start. 

  • JanineChambers's avatar
    JanineChambers
    Contributor 3
    2 months ago

    I'm team "ship-to-customer" overhead hurts and it is hard to control or predict when you have to store product or hold inventory.  If the area is booming it could come to a halt and you would be stuck trying to get rid of material and covering your overhead expenses. 

    If the area is truly gentrified the end consumer isn't always concerned with price, they will likely give preference to the easiest supplier, best option for their tastes, or sustainablility.  Is the shipping going to hold up the building process?  Is the material of the same quality as something they more readily have access to? Without knowing the wall material/competition/demographic you are serving it is hard to make an accurate observation.