In business it is a good idea to explore different avenues of saving money. Eliminating unnecessary expenses is one way of increasing your bottom line. Here are some tips for saving money on small business supplies.
6 Tips for saving money on your small business supplies
1.Get several suppliers – Don’t feel obligated to get all of your merchandise and products from one supplier. Many businesses today have several suppliers. Shop around and see which supplier offers the best rates for a product. If you find a new supplier that offers you a better price on a product take advantage of it.
2.Trade Credit– With trade credit you may be able to pay for your products/ inventory 30, 60 or 90 days after receiving them. This gives you time to sell products and raise the money needed to pay back your supplier. When using this method you should be able to effectively manage your inventory so you don’t have too much inventory and are able to pay the supplier on time. When searching for suppliers be sure to ask if they offer this.
3.Selling through consignment– You can also attain inventory with little to no money by selling through consignment. When you sell through consignment a supplier gives you the products with an understanding that you will pay them only after you sell the products. A disadvantage to this is that you do not make as much a profit as you would have if you owned the inventory. In many cases suppliers agree to sell on consignment when they have a new product they are sure will sell but retailers are hesitant about putting it on their shelves. Selling through consignment is a low risk way of testing a new product.
4.Avoiding the middlemen– Your products can be distributed through many levels before finally reaching your small business. For example a manufacturer can sell to a wholesale supplier which can sell to a distributor before selling to you. Buying straight from the manufacturer or importer can eliminate costs of middlemen. There is a disadvantage of purchasing straight from the manufacturer; you may be required to make bigger quantity purchases. Negotiating skills can prove to be useful in this situation.
5.Take advantage of Suppliers who reward Early Payments– Some of your suppliers may offer discounts or rewards for making early payments. It would be wise to prioritize payments to these suppliers before making payments to suppliers that don’t offer any benefits or discounts.
6.Buying surplus Items– Keep an eye for surplus goods that are offered far below normal prices. When manufacturers and dealers have an enormous supply of slow moving inventory they will usually sell these products as “closeouts.” Other factors that can cause surplus goods or closeouts are bankruptcies, ordering too much, or even chance. One way of finding surplus goods is through the Internet. Below are some sites containing surplus goods.