Stare At The Sun

Basically, I've been thinking about starting a business that sells Audio equipment, and accesories at about a 20% markup...I worked at best buy, and i know how huge the markup is on most stuff, especially car audio. So, basically, what all would I have to do?
What sort of liscense do you need?
Will the companies just sell to me pending I have said liscence?
Will my stuff come to me at a higher cost that stores like Best Buy, therefore, making me loose profits? If so, by how much?

I've been rolling around the idea of a business for some time...this just seems to be a niche i could get into. Any other questions, just ask.

merkerguitars

Well for me to start a computer repair business I had to get a federal tax id number and a business permit. I'm not sure how it works in ohio but the best way to find out about it is talk to other small business owners...or do what I did and talk to an accountant. For prices it probably all depends on if you get them directly from the company or a supplier and how much you buy in volume. One lady I do computer work for runs a car peformance parts company. The way it works is she gets all her stuff (every brand of parts) through this one place and then since she had to restart her company (now she is on her own) she has to buy about $10,000 worth of parts to get lower prices. Yeah my friend works at best buy too (he works at the headquarters though) and I know what you mean by stuff being marked up. Who knows if you started to sell it if you got it that low of a cost starting out until you sell lots and lots of stuff. And alot of suppliers will sometime only allow stuff to sell for retail price or higher. And remember to get a business rolling you have to work your ass off.....which is what I am doing now lol

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Stare At The Sun

^ That's what i'm worried about, i'd only have about 3k in startup money. I don't think i'd have enough to buy in true bulk.

:::OshnSoul:::

Businesses buy from wholesalers/stock carriers.

I now own an incense/oils co. out of my home- mainly via internet.

All you have to do is gather info- find 1-3 quality companies you can buy from (given that having a few co. to go through, you may have a wider variety of products sell). Fill out a form for a business liscense (very, very cheap, like $15). And also be sure to read up and know your legalities and laws. Make sure you are on top of it, so you don't get sued.
Best of wishes- it's easy to do, but it's tedious and can take a while to pick up.
Oh, and designate a specific group you want to target when you're advertising.

You can do it!


Good thing- you have $3,000 more than me when I started out. The biz is only 5 mo. young, but gradually getting popularity.

hotdogg

I have owned a few...One of the biggest reasons for failures of small business is lack of capital...When I owned a retail store, I needed to buy fixtures, cash registers and counters...I also needed to pay two months of rent in advance and give a two month security deposit. ..Then I had to buy inventory (since I had no credit rating in business, all the suppliers wanted cash up front)...It gets rather expensive (then there is Advertising, tax reporting, utilities, phones, computers, payroll, etc)

I have been in my own business for over thirty years and I wouldn't have it any other way...Good luck to you.

saltfish

Honestly, look into the small business association in your area.

They will be able to guarantee loans up to and over $100,000.

They will require you to have a business plan and the like. The SBA will also have some of the best businesspeople at their disposal to help come up with a proper business plan.

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That being said, a 20% profit margin isn't much. For an individual to sell items at a 20% markup you must sell a large volume in a small amount of time, with little effort to make a good amount of money.

-SF

gar1976

Do a little more research.

20% might SEEM high, but that needs to cover all of your operating costs. Labor, rent, utilities, insurance, etc. Retail margins are slim at best (yes, even at 20%).

So....

Maybe instead try to pick a niche, especially with a $3k starting budget. There's a reason you don't see many ma and pa electronics stores anymore, the big box stores put them under. Maybe focus on car audio to start with, or whatever you're most familiar with.

You will pay more than the big stores for the goods, since they have exclusive purchase agreements and purchasing power. So you'll need to offer better, more experienced service.

As for starting up your business, you'll need around $3-500 for articles of incorporation or a partnership/LLC agreement for attorneys fees. Don't get suckered into paying more than that.