NEWBIE BROKERING

Paying it forward... Nice.

Good stuff, John. But I don't want to get involved with the legal and financial documents, which means a)the two parties have to deal directly b)how d I protect themselves so I am not cut out of the deal c)how do I know I will be paid since it could be a one time deal based on having excess inventory d) how can I stay in the picture for future deals between the two parties.
Also, do you have an ebook, or ecourse you promote?
thanks,
CharlieNY

Well said John...
I read it one of the books where the author said...

"If you are too busy learning the Tricks of the Trade...
you may never end up learning the TRADE".

Gotto BE before you can Do before You can Have...


BE--> Do--> Have

Skills fall into the Being part.

Here's an example of how David "A world class expert" teaches, as compared to me...a guy who learned it from his kitchen table (This is why Im gonna quit teaching it, even though we have had another success story just this week):

Some guy asked "What does manufacturers cost mean"... My answer was "cost to produce"...

Here was Davids answer:

The Manufactures "cost to produce" is the direct materiel, Labor, Production Supplies, and Shipping material cost. It is the heart of the Manufactures direct immediate cost to make a product. The "manufactures cost" is all of the expense that it requires the Manufacturer to create a product from Idea inception to the final interest payment. The reason for the two separate terms is that a manufacture has to know what it takes to kick out a product so that it can quote its customers. This is why they have the term "cost to produce".

The "manufactures cost" is more of a comprehensive analysis of a product's complete life cycle. For example, if a product sells like crazy for 6 months and then a competitor comes out with a much better product the sales will most likely fall off dramatically. The "cost to produce" a million pieces of the product can be measured, but when the manufacture is suddenly stuck with 500,000 units that it can not sale then a whole other set of numbers come into play. If that surplus inventory sits there for 6 months then it becomes a close-out. If it sets there for over a year it starts to reach the liquidation status. When a manufacture can afford to hold slow moving merchandise it is called a close-out. When the manufacture reaches the point that they have more cost in the product than they can get for it. Then it becomes a liquidation.

When you measure a manufactures close-out inventory and it liquidation inventory, then you begin to add up all sorts of cost that was not intended when the product was first created. And that my friend is what you call "the manufacture's cost." IE the real cost, the whole cost, and nothing but the truth cost. If a baseball cost $3.00 to produce and it sells very well then the cost to that manufacture can be just a little over $3.00. If the baseball is found to not preform up to standard and therefore the manufacture has to manage a recall and sell off 500,000 baseballs that don't preform then the Manufacture cost kicks in. At the end of that year the cost to produce can still be $3.00 but the manufactures comprehensive cost, which include non-reoccurring and additional overhead expense, then the "manufactures cost" can be $5.50 per baseball.

The key to finding and acquiring incredible deals is to know the difference. I used to own the world's largest factory of wallpaper border. We produced 110,000 border every day; IE from jumbo reel to small spools. Most product lines went well, but every now and then we would get a lemon. Something that would not sell or had a defect. I was in the situation room a many times when we had to decide on weather to lay people off or fix a product problem. There was a few times that I said, "burn it if you have to, we just can not afford to keep moving this around and having our sales people spend so much time with it." Every manufacture deals with a situation like that periodically.

So the best way to find these deal is to ask this simple question. How long have you had this merchandise. Just like when you buy a house. It is always a good idea to ask, how long has this house been up for sell? If the answer is 3 to 6 months then it is no big deal. But if they say it has been for sale for 2 years then you know something is up. When you find a manufacture that has had something for a while then you may have found a great deal. Unlike with housing a buyer will come along at market value soon. With distress merchandise, you are competing with the land field. I bought 35 truck loads of wallpaper in a factory shut down for $.08 per roll. The new manufacture that bought out the bankrupt factory was in Canada and it did not make since for them to pay to have it shipped from Tennessee to Toronto. They wanted $.50 per roll. I told them that if it comes to the point of paying to have it thrown away then give me a call. 30 days later my phone rang and they said come and get it.

Just because a manufacture is enormous in size does not mean that you can not bring the giant to its knees. I would not get caught up on the terminology or the semantics. But I think I hear within your question a very important point and that is, how can I make the most incredible deal possible by understand the suppliers cost. Or better said the suppliers challenges. Once again, the best way to find out what can move dirt cheap is asking what are they really stuck with. If they are to proud to answer then make another call. You can do 20 deals and be exhausted at the end of a year. Or you can make twice the calls an only buy incredible deals with customers waiting for the product. Your better off to turn 4 deals a year and reduce your risk by making twice the calls and insisting on a deal that is hard to believe.

Those deals are there. They are all over the place. After the recession of 2008 more manufactures are stuck with products then ever before. Yes its true that the stock market measures the fact that inventories are down and the US manufactures are now building inventories. But this is current goods not distress goods. If you take a look a that number it would blow your mind. Non discretionary inventory is at an all time high in the US. So you might ask the question, Well if the US Manufacture is so stuck with this product then why would any one else even want it. The answer in most cases is that less then half of the US manufactures do any kind of significant exporting.

As you will find when you talk with manufactures, they will tell you that they don't even want to fool with selling overseas. Most of the time it has to do with money management and risk. I have a recent post that explains how to mitigate risk and increase your worth by being the money manager. What I sometimes find interesting with exporting is how another country looks at distressed merchandise as something brand new. So know that one manufactures trash is another buyers treasure. This is not true in all cases. But the deals are there. And don't forget that you are better off to never sell something unless you have it sold first.

The one reason that I think telemarketing people have an advantage in this field of work is that they are good with the phone. If you really don't want to talk with a lot of people then your better off doing something different. If you can make hundreds of calls to make a handful of really great deals then this might just be for you. Most people that get good at this end up traveling the world to visit their customers, make great money, and have the satisfaction of being a world wide exporter of merchandise.

I really wish that most individuals in this field of work would learn to enjoy the process more then the result. One time John and I was recording an album together in Nashville. All we could think about was getting a record deal. One of the industries top musician, Brent Rowen, told us to concentrate on what creating music makes of us as a person. Years later I look back at that advice and wish I could do it again. Some of you will make it to the top of the mountain with exporting. While the rest will deal with what this experience means for them.

I think it is so much about the spirit of exploration. Centuries ago exporting was done for the King or the Queen of the country. Then as time went along large wealthy companies started to trade. Today small businesses have been exporting for less then 50 years for the most part. Now, Now is the time for the individual to learn to trade. Today more and more individuals refuse to except that they must have a large company to participate in world wide trade.

I hope this information is helpful in answering the spirit of your question.

Word to the Wise.


(Back to JD)

Doesnt mean my forum wont offer export training, just means Im gonna solicit better trainers to teach there.



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Dang that must be awesome!

I have a 52 reissue tele and a 57 reissue strat (Edit: Traded Strat for a 97 taylor 810. Super sweet! I guess I will just mod out the mexican strat now).... Maybe as good as it'll get here... heck a 76 has got to be running at least 15-20k these days.

I think my next move is to start "building" them. i have wanted to do my own custom guitar brand for a while now... may start this year. I want to build some collectors guitars... under my grandson vincents name...

I have an idea for a super strat style right now I want to call the V. Rios Viper. Dont get me started... Got a ton of passion for exquisite guitars and posterity.

And Brent Mason... Whew! He is smokin on the blues jazz country, rock whatever... IMHO the best for my dime.