Real life business problem

[Charles]

Originally Posted by mossbacked

Well, it was depressing.

He now travels to China every 3 to 4 months on buying trips and purchases almost everything he sells by the containerload direct from the producers. He buys large enough quantities of some items that they are "private branding" the items to reflect his store's name. As his quantities grow they are even beginning to private label the smaller quantities based upon his overall growing volume. He buys almost nothing from his former vendors here in the US (although their products are now mostly manufactured overseas too). He just now cuts them out of the equation by going direct to the source.

His advice was that I accompany him on a future buying trip where he would make some introductions that he thinks would help me.

I drove home after lunch feeling ill about the whole revelation that we probably won't be able to pull off producing here in the states.

Thank you.

I've always placed a great deal of stock into the advice of a mentor.

I learned a lot from mine, only I never developed the appetite to bet it all on the last card.

He was a gambler, I prefer a calculated risk.

Chas

[merrylander]

Interesting note, we can't build small cars here because of the high cost of labour. So GM now pays assembly line folks $14 /hr instead of $28/hr. Total savings on the cost of the new Chevy Scion - $173.

Care to join us in the race to the bottom? I would happily pay that extra $173 if it meant someone getting a decent wage.

[mossbacked]

Originally Posted by Charles

Thank you.

I've always placed a great deal of stock into the advice of a mentor.

I learned a lot from mine, only I never developed the appetite to bet it all on the last card.

He was a gambler, I prefer a calculated risk.

Chas

The strange twist to all of this is I am acting as a "middle-man mentor" to the product inventor, who is a close friend, and who's now moving into a more entrepreneurial phase of his life. My role here actually will not encompass production, but the marketing function, but I'm trying to look out for him there as I have a little production experience plus the mentor I visited.

At any rate, using himself and his family, my friend believes he can produce cheaply. So I asked him if he was OK when the first 100 orders came in? He answered yes. The first 500? Yes. The first thousand?

And there I could see he was stumped because he knew that was his ramp up point where he would need to pay, train and manage others to produce.

We went through the exercise of estimating what that would cost and he realized then and there he had been pricing himself too cheaply (almost at zero). Additionally, he's reluctant to put a cost on himself if he is only managing and not hands-on producing (an error many new business owners make).

So, he's still going to forge ahead and I'm still going to do what may turn out to be some pro bono marketing work. I can't help myself because first, he's a close friend, and second, the thrill of bringing something new to market is like pure adrenaline to me!

I don't know if it's against forum policy, but I will post a link if allowed when we roll out.

[Charles]

Originally Posted by mossbacked

The strange twist to all of this is I am acting as a "middle-man mentor" to the product inventor, who is a close friend, and who's now moving into a more entrepreneurial phase of his life. My role here actually will not encompass production, but the marketing function, but I'm trying to look out for him there as I have a little production experience plus the mentor I visited.

At any rate, using himself and his family, my friend believes he can produce cheaply. So I asked him if he was OK when the first 100 orders came in? He answered yes. The first 500? Yes. The first thousand?

And there I could see he was stumped because he knew that was his ramp up point where he would need to pay, train and manage others to produce.

We went through the exercise of estimating what that would cost and he realized then and there he had been pricing himself too cheaply (almost at zero). Additionally, he's reluctant to put a cost on himself if he is only managing and not hands-on producing (an error many new business owners make).

So, he's still going to forge ahead and I'm still going to do what may turn out to be some pro bono marketing work. I can't help myself because first, he's a close friend, and second, the thrill of bringing something new to market is like pure adrenaline to me!

I don't know if it's against forum policy, but I will post a link if allowed when we roll out.

I hope you do post a link as you've piqued my curiosity. I also wish your friend and yourself the best of luck.

I can also appreciate the enjoyment you derive from bring a new product to market. Developing the better mouse trap and then closing the deal is the fun part. And the more challenging the mouse trap is, the more fun it is.

Chas