Interviews with suppliers: prices on request, RRP, joint procurement
Many owners of online stores in the process of searching for suppliers of goods probably faced certain requirements for distributors of their products. We decided to ask some suppliers to tell us why such requirements exist. Our suppliers also spoke about joint purchases and the need for recommended retail prices.
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A classic example: you found in the search engine interesting products offered by a supplier, go to their website to see prices, and ... see the inscription in the style “To see our prices, send us your TIN, OGRN, charter, passport, latest tax statement,a notarized screenshot of your online store , and only then we will show you our prices. Or do not show.
“ Why such secrets? I am a potential client, I want to get acquainted with the range and prices for it. Why so difficult? "- about such thoughts often arise from owners of online stores when meeting with suppliers.
If you are only planning to open an online store, then the fact that a supplier can strictly monitor your prices, assortment, and even the design of your online store can be an extra surprise for you.
Of course, all suppliers have different requirements and loyalty, but the approximate features of all are the same. A supplier’s managers may not always give you a detailed answer about the nature of requirements from their superiors.
We decided to talk with the owners of three different companies that specialize in the wholesale trade in different segments of the market, and ask them a few questions in order to clarify for our readers some features of working with them.
So, meet our guests:
1. Nikolay Nikolayev , General Director of Valteritextiles LLC.
Supplier of textile products: bed linen, pillows, blankets, rugs.
2. Nikolai Sotnikov , CEO of Aushouse .
Supplier of household goods and interior items.
3. Kirill Chernyshev , Head of Sales Department TD “AUDACHE”
Supplier of women's clothing and underwear.
And the first question:
Do you hide wholesale prices for your products from third-party viewers?
Nikolai Sotnikov: Yes, we will send them on request. We are primarily a retail company, and our storefront is an online store that shows retail prices. B2B clients are attracted by us through separate channels - by sending us a request for a price through the appropriate form, or by writing a letter. And we, in turn, respond with a price list. Our wholesale prices can be found on a couple of specialized services, including Comerando - they are available to potential customers. But in a retail store, it’s not practical to demonstrate them - the buyer should not distract anything from the purchase and lead to confusion.
Kirill Chernyshev: We hide wholesale prices for several reasons.
This is one of the few opportunities to get contact information of a potential client. As a rule, the price itself is rather scant information. It is necessary to talk with a person and provide him with complete information. Of course, he can independently get an idea of ​​the order of prices, but this is quite superficial information.
The prices themselves are not a secret, but we would like to know who we are communicating with.
Nikolay Nikolaev: Basic wholesale prices are available for all categories of potential customers: both wholesale and retail. The base price is available on our website, as well as the basic wholesale prices are displayed in the product card on the site.
Does your company have a minimum purchase amount?
Nikolai Sotnikov: Yes, and it is rather symbolic. From 5,000 rubles for legal entities and from 15,000 rubles for individuals (joint purchases).
Nikolay Nikolaev: We offer the opportunity to buy goods at the wholesale price to anyone - for this it is enough to place an order for the minimum amount for today this amount is 25,000 rubles.
Regarding online stores: we don’t have a minimum order amount for them - the wholesale price is 1 piece. It's just that everyone works with online stores. This is the specificity of this category of clients.
Kirill Chernyshev: We work completely on the terms of the factories we cooperate with. As a rule, the factory regulates exactly the first purchase (at least from 20-30 thousand rubles). In the future, the client can purchase and for smaller amounts to sort the goods, but this rarely happens. In general, we do not consider the purchase of 5-7-10 thousand rubles as wholesale, if it is not a sub-sorting of old items.
About RRTS
RRP is an abbreviation of Recommended Retail Price. A similar column in the price list tells you at what price it is better to sell products. Often, the RRP is in contradiction with the phrase itself is not advisory, but mandatory, and intersects with MRC (minimum retail price). When signing a contract with customers, many suppliers are also obliged to sign a so-called “anti-dumping agreement”, in which various sanctions for selling goods at a cost below the RRC can be specified. Now ask our suppliers:
Do you have a RRP for wholesale buyers?
Nikolay Sotnikov: No, we decided to remove it, since our goods cannot be classified as RRCs, and each client has its own economy. We, for comparison, show our retail prices, and customers decide on the size of the markup themselves.
Nikolay Nikolayev: We have a RRP - the recommended retail price with a minimum mark-up of 70%. We closely monitor compliance with this parameter and work with unfair competition and dumping. We refuse shipment if the client repeatedly fails to comply with the RRC. This applies to all categories of customers.
Kirill Chernyshev: Our RRC = 100%.
These are the figures formed in the market in conditions of absolute market relations.
Today, the RRP is formed on the basis of such expenses as: rental payments, taxes, employee salaries, advertising, profits.
Of course, everyone has these costs different, someone has more, someone has less, but the average RRC in the country is 100%. It may also vary from product category, seasonality, and so on.
There are several reasons why this mark-up allows an enterprise to exist normally and not survive. The product is not sold under the order, and formed the range of the store, which must be constantly maintained. Something is sold in 2 days, and something in a month. The longer the goods lie on the shelf, the more expensive it costs the seller. Therefore, if the goods are lying long enough, then it is easier to sell them at a discount and bring a new product.
Among buyers there is an opinion that at a discount they sell goods that are not needed or of poor quality, but this is not always the case. Returning to the RRP, with a 100% mark-up, the maximum discount that the seller can make on the sale of goods is 50% in order to return the money invested, but this does not take into account all costs associated with the sale. It turns out that even a 20-30% discount already leaves an entrepreneur without income. At the same time there is a risk that the product will not find its buyer at all. These risks are also included in the price.
If the entrepreneur does not take into account these moments, it is unlikely that the business will be profitable, and sooner or later he will have to close.
Different regions have different pricing situations. We can not force to set the price exactly 100%. But if the price is significantly underestimated - we will not work with such clients.
Some suppliers require a whole package of documents from wholesale buyers. Do you have any requirements for your customers?
Nikolai Sotnikov: There are no requirements as such. We find out the necessary information about the client in a conversation with him, as well as look at additional information about his company on the Internet, social networks and other sources. Most of the requirements are most likely made by those suppliers who work on the terms of implementation - we, at the moment, are mainly working on prepayment.
Nikolay Nikolaev: The list of documents, as I assume, is needed to work with a deferred payment. Since the situation is not simple, there is a risk of non-fulfillment of contractual obligations.
Of course, we don’t need such a list to start cooperation. Managers in the course of work may request some documents or data to fill in the contract. But to start working - we only need an order and contacts, the rest is already discussed individually.
Kirill Chernyshev: The set of documents is regulated by the legislation of the Russian Federation. In our case, when working with individual entrepreneurs, we ask for copies of the documents:
1) TIN
2) OGRN
3) passport (first page and with registration)
There are still cases when businessmen are surprised why we need their residence permit, and so: for the SP, the legal address is the address of the residence permit, which is why we need this document.
For legal entities
1) TIN
2) OGRN
3) first and last page of the statute
This is a standard set of documents, and additional documents may be requested.
And from a practical point of view: what is their need (deferment of payment or something else)?
Kirill Chernyshev: We are working on full prepayment. And the list of documents does not affect this.
Well, from the legislative point of view? Do you provide these documents “higher”? And what is this law? Please tell us more, this will be especially useful information for new traders.
Kirill Chernyshev: We hand over these documents to the tax inspectorate upon request. Also, on the basis of these documents a contract is drawn up.
Do you work with clients about whom you have not found any information, and is he only planning to open an online store?
Nikolay Sotnikov: We request their details and conclude an agreement, and then (after the launch of the site) we watch and monitor their prices. We are interested in the development of our clients' businesses and also help them with technical advice, photographs, give recommendations on logistics, etc. - this applies to start-up entrepreneurs who consider us as the first suppliers.
Kirill Chernyshev: At the moment we do not work with online stores in general. If someone offers a normal scheme of work and the turnover will exceed the same 30,000 per month, then there is no question. We are ready to consider the minimum purchase amount of 10,000 rubles, delivery to the shopping center for 500 rubles, self-pickup is possible.
Pro joint purchases
Joint purchase (joint purchase, collective purchase) - the principle of the organization of purchase, in which several individuals are combined into a group to purchase goods directly from a supplier or manufacturer at wholesale prices (quoted from the wiki). Let's ask our guests:
How do you feel about the organizers of joint procurement? Do you work with them?
Nikolay Sotnikov: Yes, we work, and we treat them well. This is the same wholesale customer for us.
Nikolay Nikolaev: I have a great attitude, and we work very well with such clients. Joint purchases are rather important for us category of clients, we are actively working with them. So far there have been no complaints from our regular customers. Moreover, almost all companies in the textile market also work with such clients.
Kirill Chernyshev: Individuals who purchase goods for personal use are retail customers, which is absolutely not our field of activity. These are the clients of our clients.
SP is a completely separate story. We can sometimes offer stock assortment or some separate positions, but we cannot work with the basic assortment.
It is important to understand how the joint venture works. This is a group of people organized to buy a specific range at wholesale prices. The person who organizes the joint venture takes from 10% to 20% for all the fuss.
If to judge only from the point of view of a retail buyer, of course, getting the goods with a markup of 20%, and not 100% is much more profitable. But what will you do if the goods did not fit in size, the color turned out to be different from what you wanted, or you just didn’t like the model? There are a lot of people who, because of the price, are willing to take risks and buy from the photo.
And some, especially intelligent, find this product in retail stores, try on, check the size (use the entire service of the retail store), and order it from the joint venture.
So, the joint venture is a market that does not necessarily overlap with customers who buy goods in retail stores. Many simply do not use the Internet or are not ready to buy goods at random.
But with all this, the joint venture can really damage the sales of a separate brand due to a very strong dumping. We have been building our work with clients for years and for a very long time, and working with a joint venture is here and now. To date, we simply have nothing to offer the joint purchases segment without sacrificing our customers. As soon as we have something to offer, we will definitely turn our attention to this market.
Are you not afraid that they can damage your regular wholesale customers by selling goods cheaper? Their margin is not more than 10-20% (purchase service)
Nikolai Sotnikov: Consequently, the joint venture in any case is at least 10-20% more expensive than ours. After all, they will not sell the goods without their extra charge. In addition, there is no sense for wholesalers to turn to a joint venture, and they (wholesalers) hardly know about those organizers with whom we work.
A joint venture is an absolutely niche story, not going beyond a certain size-limited community - in each city there are joint venture organizers and people who sit on thematic forums and are looking for such organizers. But these scales are not commensurate with the volume of the market as a whole.
Nikolay Nikolaev: No, I am not afraid, because I think that these are different segments of the market. In addition, large customers have our discounts on the basic wholesale price. In addition, almost all of our competitors work with this category of customers.
')
A classic example: you found in the search engine interesting products offered by a supplier, go to their website to see prices, and ... see the inscription in the style “To see our prices, send us your TIN, OGRN, charter, passport, latest tax statement,
“ Why such secrets? I am a potential client, I want to get acquainted with the range and prices for it. Why so difficult? "- about such thoughts often arise from owners of online stores when meeting with suppliers.
If you are only planning to open an online store, then the fact that a supplier can strictly monitor your prices, assortment, and even the design of your online store can be an extra surprise for you.
Of course, all suppliers have different requirements and loyalty, but the approximate features of all are the same. A supplier’s managers may not always give you a detailed answer about the nature of requirements from their superiors.
We decided to talk with the owners of three different companies that specialize in the wholesale trade in different segments of the market, and ask them a few questions in order to clarify for our readers some features of working with them.
So, meet our guests:
1. Nikolay Nikolayev , General Director of Valteritextiles LLC.
Supplier of textile products: bed linen, pillows, blankets, rugs.
2. Nikolai Sotnikov , CEO of Aushouse .
Supplier of household goods and interior items.
3. Kirill Chernyshev , Head of Sales Department TD “AUDACHE”
Supplier of women's clothing and underwear.
And the first question:
Do you hide wholesale prices for your products from third-party viewers?
Nikolai Sotnikov: Yes, we will send them on request. We are primarily a retail company, and our storefront is an online store that shows retail prices. B2B clients are attracted by us through separate channels - by sending us a request for a price through the appropriate form, or by writing a letter. And we, in turn, respond with a price list. Our wholesale prices can be found on a couple of specialized services, including Comerando - they are available to potential customers. But in a retail store, it’s not practical to demonstrate them - the buyer should not distract anything from the purchase and lead to confusion.
Kirill Chernyshev: We hide wholesale prices for several reasons.
This is one of the few opportunities to get contact information of a potential client. As a rule, the price itself is rather scant information. It is necessary to talk with a person and provide him with complete information. Of course, he can independently get an idea of ​​the order of prices, but this is quite superficial information.
The prices themselves are not a secret, but we would like to know who we are communicating with.
Nikolay Nikolaev: Basic wholesale prices are available for all categories of potential customers: both wholesale and retail. The base price is available on our website, as well as the basic wholesale prices are displayed in the product card on the site.
Does your company have a minimum purchase amount?
Nikolai Sotnikov: Yes, and it is rather symbolic. From 5,000 rubles for legal entities and from 15,000 rubles for individuals (joint purchases).
Nikolay Nikolaev: We offer the opportunity to buy goods at the wholesale price to anyone - for this it is enough to place an order for the minimum amount for today this amount is 25,000 rubles.
Regarding online stores: we don’t have a minimum order amount for them - the wholesale price is 1 piece. It's just that everyone works with online stores. This is the specificity of this category of clients.
Kirill Chernyshev: We work completely on the terms of the factories we cooperate with. As a rule, the factory regulates exactly the first purchase (at least from 20-30 thousand rubles). In the future, the client can purchase and for smaller amounts to sort the goods, but this rarely happens. In general, we do not consider the purchase of 5-7-10 thousand rubles as wholesale, if it is not a sub-sorting of old items.
About RRTS
RRP is an abbreviation of Recommended Retail Price. A similar column in the price list tells you at what price it is better to sell products. Often, the RRP is in contradiction with the phrase itself is not advisory, but mandatory, and intersects with MRC (minimum retail price). When signing a contract with customers, many suppliers are also obliged to sign a so-called “anti-dumping agreement”, in which various sanctions for selling goods at a cost below the RRC can be specified. Now ask our suppliers:
Do you have a RRP for wholesale buyers?
Nikolay Sotnikov: No, we decided to remove it, since our goods cannot be classified as RRCs, and each client has its own economy. We, for comparison, show our retail prices, and customers decide on the size of the markup themselves.
Nikolay Nikolayev: We have a RRP - the recommended retail price with a minimum mark-up of 70%. We closely monitor compliance with this parameter and work with unfair competition and dumping. We refuse shipment if the client repeatedly fails to comply with the RRC. This applies to all categories of customers.
Kirill Chernyshev: Our RRC = 100%.
These are the figures formed in the market in conditions of absolute market relations.
Today, the RRP is formed on the basis of such expenses as: rental payments, taxes, employee salaries, advertising, profits.
Of course, everyone has these costs different, someone has more, someone has less, but the average RRC in the country is 100%. It may also vary from product category, seasonality, and so on.
There are several reasons why this mark-up allows an enterprise to exist normally and not survive. The product is not sold under the order, and formed the range of the store, which must be constantly maintained. Something is sold in 2 days, and something in a month. The longer the goods lie on the shelf, the more expensive it costs the seller. Therefore, if the goods are lying long enough, then it is easier to sell them at a discount and bring a new product.
Among buyers there is an opinion that at a discount they sell goods that are not needed or of poor quality, but this is not always the case. Returning to the RRP, with a 100% mark-up, the maximum discount that the seller can make on the sale of goods is 50% in order to return the money invested, but this does not take into account all costs associated with the sale. It turns out that even a 20-30% discount already leaves an entrepreneur without income. At the same time there is a risk that the product will not find its buyer at all. These risks are also included in the price.
If the entrepreneur does not take into account these moments, it is unlikely that the business will be profitable, and sooner or later he will have to close.
Different regions have different pricing situations. We can not force to set the price exactly 100%. But if the price is significantly underestimated - we will not work with such clients.
Some suppliers require a whole package of documents from wholesale buyers. Do you have any requirements for your customers?
Nikolai Sotnikov: There are no requirements as such. We find out the necessary information about the client in a conversation with him, as well as look at additional information about his company on the Internet, social networks and other sources. Most of the requirements are most likely made by those suppliers who work on the terms of implementation - we, at the moment, are mainly working on prepayment.
Nikolay Nikolaev: The list of documents, as I assume, is needed to work with a deferred payment. Since the situation is not simple, there is a risk of non-fulfillment of contractual obligations.
Of course, we don’t need such a list to start cooperation. Managers in the course of work may request some documents or data to fill in the contract. But to start working - we only need an order and contacts, the rest is already discussed individually.
Kirill Chernyshev: The set of documents is regulated by the legislation of the Russian Federation. In our case, when working with individual entrepreneurs, we ask for copies of the documents:
1) TIN
2) OGRN
3) passport (first page and with registration)
There are still cases when businessmen are surprised why we need their residence permit, and so: for the SP, the legal address is the address of the residence permit, which is why we need this document.
For legal entities
1) TIN
2) OGRN
3) first and last page of the statute
This is a standard set of documents, and additional documents may be requested.
And from a practical point of view: what is their need (deferment of payment or something else)?
Kirill Chernyshev: We are working on full prepayment. And the list of documents does not affect this.
Well, from the legislative point of view? Do you provide these documents “higher”? And what is this law? Please tell us more, this will be especially useful information for new traders.
Kirill Chernyshev: We hand over these documents to the tax inspectorate upon request. Also, on the basis of these documents a contract is drawn up.
Do you work with clients about whom you have not found any information, and is he only planning to open an online store?
Nikolay Sotnikov: We request their details and conclude an agreement, and then (after the launch of the site) we watch and monitor their prices. We are interested in the development of our clients' businesses and also help them with technical advice, photographs, give recommendations on logistics, etc. - this applies to start-up entrepreneurs who consider us as the first suppliers.
Kirill Chernyshev: At the moment we do not work with online stores in general. If someone offers a normal scheme of work and the turnover will exceed the same 30,000 per month, then there is no question. We are ready to consider the minimum purchase amount of 10,000 rubles, delivery to the shopping center for 500 rubles, self-pickup is possible.
Pro joint purchases
Joint purchase (joint purchase, collective purchase) - the principle of the organization of purchase, in which several individuals are combined into a group to purchase goods directly from a supplier or manufacturer at wholesale prices (quoted from the wiki). Let's ask our guests:
How do you feel about the organizers of joint procurement? Do you work with them?
Nikolay Sotnikov: Yes, we work, and we treat them well. This is the same wholesale customer for us.
Nikolay Nikolaev: I have a great attitude, and we work very well with such clients. Joint purchases are rather important for us category of clients, we are actively working with them. So far there have been no complaints from our regular customers. Moreover, almost all companies in the textile market also work with such clients.
Kirill Chernyshev: Individuals who purchase goods for personal use are retail customers, which is absolutely not our field of activity. These are the clients of our clients.
SP is a completely separate story. We can sometimes offer stock assortment or some separate positions, but we cannot work with the basic assortment.
It is important to understand how the joint venture works. This is a group of people organized to buy a specific range at wholesale prices. The person who organizes the joint venture takes from 10% to 20% for all the fuss.
If to judge only from the point of view of a retail buyer, of course, getting the goods with a markup of 20%, and not 100% is much more profitable. But what will you do if the goods did not fit in size, the color turned out to be different from what you wanted, or you just didn’t like the model? There are a lot of people who, because of the price, are willing to take risks and buy from the photo.
And some, especially intelligent, find this product in retail stores, try on, check the size (use the entire service of the retail store), and order it from the joint venture.
So, the joint venture is a market that does not necessarily overlap with customers who buy goods in retail stores. Many simply do not use the Internet or are not ready to buy goods at random.
But with all this, the joint venture can really damage the sales of a separate brand due to a very strong dumping. We have been building our work with clients for years and for a very long time, and working with a joint venture is here and now. To date, we simply have nothing to offer the joint purchases segment without sacrificing our customers. As soon as we have something to offer, we will definitely turn our attention to this market.
Are you not afraid that they can damage your regular wholesale customers by selling goods cheaper? Their margin is not more than 10-20% (purchase service)
Nikolai Sotnikov: Consequently, the joint venture in any case is at least 10-20% more expensive than ours. After all, they will not sell the goods without their extra charge. In addition, there is no sense for wholesalers to turn to a joint venture, and they (wholesalers) hardly know about those organizers with whom we work.
A joint venture is an absolutely niche story, not going beyond a certain size-limited community - in each city there are joint venture organizers and people who sit on thematic forums and are looking for such organizers. But these scales are not commensurate with the volume of the market as a whole.
Nikolay Nikolaev: No, I am not afraid, because I think that these are different segments of the market. In addition, large customers have our discounts on the basic wholesale price. In addition, almost all of our competitors work with this category of customers.
Source: https://habr.com/ru/post/293756/
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