In studying for Web Business MKT 250 this last week I learned about suppliers and how to find one that aligns with your goals and needs. In purchasing mass product, you either work with a broker, a wholesaler, or a manufacturer. A broker would be someone who works as an in-between for you and the manufacturer, a wholesaler purchases mass product and then resells it at bulk discount, and the manufacturer is the one actually producing the product. Obviously, the more you can remove the middle men the cheaper the product will be, but as a small start-up you often don’t have the weight or status to make a deal directly with a manufacturer, so another route may be better.
We used a decision matrix based on three criteria to rank our options, first with a sunglasses retailer, then between affiliate and drop shipping models. Affiliate models tend to need someone with experience in the industry and need quality content to pull people in to use affiliate links. Drop shipping models require more steady ongoing customer service but don’t require as much initial work and offer better profits. I personally prefer the drop ship model, though in the case study they gave us I supported an affiliate model due to the circumstances.
The decision matrix I learned is a great tool for important choices and the added knowledge and practice at finding a wholesaler and understanding affiliate and drop ship models has put me in a great place to start considering my own real-life choices for online business.