Selling your product/service through telemarketing is becoming increasingly popular. Similar to direct mail, telemarketing allows sales to be made on a local, national and global scale, although the costs will increase with the time and distance of phone calls. Extra skills may also be required creating the need for more staff. Alternatively, a professional service can be consulted to carry out the task: with an increased cost and/or commission.
With the popularity of the Internet ever increasing, it has now become one of the most common ways of doing business: e-commerce. Although e-commerce was often associated more with the larger companies, small businesses have now benefited from joining the bandwagon.
The Internet acts a shop window for your business where your particular web site will allow consumers to view or purchase your product(s)/service(s) on-line.
The Internet can also be used as a marketing tool, purely promoting your products, which will aim to result in more sales from other distribution channels.
The Internet can help target consumers worldwide although it may be more feasible for consumers to purchase from within the nation (due to costs of postage or feasibility of using the service). The obvious cost of using the Internet for sales is the original set-up and consistent maintenance, as well as the administration.
Like ourselves, some small businesses are purely Internet orientated selling services and products completely via their web site i.e. at any time, they will have no personal contact with the consumers.
An agent or broker will help sell your product/service, but will not take ownership of what they are selling at any time. They usually work on commission taking a percentage of the total sales made by themselves. An agency or brokerage will sell your product or service, for example insurance, tickets for entertainment, accommodation, etc. This can be directly to the consumer or to retailers and wholesalers.
Agents/brokers can sell your product on a scale than extends from your business premises and are very useful for expanding your business into foreign markets.
Perhaps the most common example of an agent would be a travel agency. They never own the holidays or credit the full amount of the sale to their business. Instead, they act as a link between the holiday resort and the consumer, taking a commission on the sales.
It may be that you only sell to a wholesaler if you manufacture your own products: possibly evidencing a larger small business. If this is the case, a wholesaler can be used to distribute your products reaching a potentially large number of consumers. The main function of a wholesaler is to provide a link between the producer (you) and the retailer. The advantage of selling to a wholesaler is that they often buy in bulk, splitting the purchase into smaller manageable quantities for further selling to retailers.
Once selling to a wholesaler, there are three ways that your product will reach the consumer. Firstly, the consumer will purchase directly from the wholesaler: this is the less common route out of the three. Alternatively, your products will be sold on by the wholesaler to retailers.
The other advantages of selling to a wholesaler are that they may have strong links with quality retailers: research will help discover this fact. In addition, because they buy in bulk, it reduces the burden of on-site storage at your premises reducing overhead costs. Further, wholesalers will also take away the burden of transportation, as they often have their own network of transport delivering goods directly to retailers, which would normally be your responsibility.
The disadvantage of using a wholesaler to distribute your products is that they cannot market your products extensively. Further, because they buy in bulk, it is often you will sell at a price much lower than the final retail price. Therefore, the wholesaler will take some of the profit because they will sell on your products in smaller quantities at a higher price.
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