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Need opinions on new business

Discussion in 'Black Hat SEO' started by jon_xx_x, Mar 13, 2014.

  1. jon_xx_x

    jon_xx_x Jr. VIP Jr. VIP

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    I picked up a slick premium domain, we'll say it's faucets.com.
    So it's a great branding oppportunity.

    My initial thought was to get my own products made from China with my company on the product, box etc. Profits are good. Say there's a comparable product for $250, my cost would be about $100. But in the end, I'd probably only carry 3-4 different types. Now I want to be THE site for 'faucets'. I guess if I still build my brand I can be, with my own products, but I was wondering if I should carry other brand's products as well, be the faucet superstore.

    The advantage of this is if someone comes to my store and has a brand in mind, I'll have it. I'll be the largest online faucet store. Where as if I just had my products, they might leave, so atleast I'm making something. THe downside is, if they decide on the other brand instead of mind, profit won't be as high, and maybe people never buy my product and my brand ends up being a waste of time... but I guess my domain in it's own will be branded, just not my own products. If I just stick with my brand, it might take longer, but if I build the reputation of it, it could be THE brand, and other sites will want to sell my products on their site.

    Thoughts? I know there are some smart guys here!
     
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  2. kbklash

    kbklash Senior Member

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    Hello Jon.
    Congrats BTW.
    I am just sharing my personal and simple thoughts .Being a super-stockist is big job,IMHO.But if you know,what you are doing.That definitely stand a chance.May be the returns'd be low for being a superstockist or promoting others products.Profit margins in the world of super-stockist sales are usually pathetically low.But on other hand,yours will be an exclusive online mall for all kinds and brands of Faucets.

    In terms of branding of your own manufacturing goods and selling it widely takes good amount of time.Be sure you work out all of your selling costs before you start into manufacturing and marketing.And maybe you could create a section called 'Recommended Products' Or 'Items you should check out' and make people aware that you are also dealing with 3rd party items.So you catch a sale there also.

    All the best
     
  3. jon_xx_x

    jon_xx_x Jr. VIP Jr. VIP

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    Thanks for your thoughts. Most of the other company's products are higher valued products $200+, so I'd hope to atleast make a little bit per sale. If it's not a decent amount I'd scrap the idea. And I was probably going to use Amazon.com for order fullfillment. It's expensive, but I'm in Canada, and it would be impossible for me to do it from up here. So they'll take care of the pain of shipping and returns.

    Recommended products is a great idea.
    And yeah it could take a good amount of time to build a brand, but say 3 years from now it pays off and I'm a known brand, that would be amazing.
    So probably not best idea short term, but long term it's probably best.
     
  4. Asif WILSON Khan

    Asif WILSON Khan Executive VIP Premium Member

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    Build your site up first, become known as the authority on faucets and the place with a wide selection.
    Be a one stop shop with accessories and expert advice and reviews.
    Have all orders fulfilled by Amazon.

    Once you have got the traffic THEN arrange the manufacturing of your own range.

    I doubt your own range would be significantly cheaper than your competitors as they would have the items manufactured in China too.

    Don't make price the UPS unless you are looking to break into the budget market. Make your products the best quality.
     
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  5. netmoney1

    netmoney1 Executive VIP

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    1. Build a kick ass site
    2. Get it ranking, breathing fire down the neck of the comp
    3. Form a partnership to promote an unbranded version of their product and get a nice cut

    Think about it - if they already have production, distribution, etc - they can easily manufacture them without their name on them...and fulfill the orders generated from your site.

    This benefits them because:

    They don't have competition now. They would much rather "control" the top and take a smaller piece of the pie then to lose a chunk to you.

    This benefits you:


    A million ways. You don't want to have to deal with manufacturing, distribution, returns, customer service, etc. Trying to do it on your own could be a nightmare...shit loads of money, 3 manufacturers later, etc....

    Screw that...kick back and collect a "royalty" all day long...
     
  6. Duffers5000

    Duffers5000 Elite Member

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    Thats what I would do. Build the site and brand and resell other peoples products. Find out whats selling and where are the gaps in the market. Once you have this knowledge you can start to price up "Faucets" and work out what will be the best return for your money---cheapest to manufacture with the best markup.

    Chinese manufactured goods can be time consuming to get going and the real discounts are only there if you are buying in large orders, if you rush in without market knowledge you could end up with boxes of saleproof stuff all over the house.

     
  7. Execute

    Execute Supreme Member

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    I agree with netmoney1, you should focus on building the site which is the area of expertise that you know and then work out from there with partnerships.

    Also getting your own product developed is very expense and very time consuming. You have to get plans made and then get moulds specifically created if for your design elements etc etc. That is also just the product development side. You then need shipping, storage, insurance, customer service, after sales support, all of which your competitors will have in place.

    Piggy back on their infrastructure and learn the business from the ground up. You will be a lot more comfortable making your own product once you have seen their whole system in action and analysed each part.
     
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  8. Gyuman82

    Gyuman82 Jr. VIP Jr. VIP Premium Member

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    Just work on your own brand first and go from there.

    By only developing your own brand products you should be able to lower your cost as you can focus more money on your own stuff then carrying a full line.

    Also if you are going into manufacturing, I would highly recommend visiting China and meeting face to face with these people.

    I used to work in that biz, and there are a lot of shady people over there that can f*** you over if you don't know what you're doing.
     
  9. tony_d

    tony_d Elite Member

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    Dealing with China is probably the single worst thing I've ever done... there are a couple of great alternatives offered above by w130sn and netmoney, and I suggest you'd be well served to take either option over your original thought :)
     
  10. funkybunker

    funkybunker Supreme Member

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    I may have it wrong, but won't you need licensing to re-sell other brands' product? Either way I say go with netmoney1's suggestion - always make starting as easy as possible.
     
  11. jon_xx_x

    jon_xx_x Jr. VIP Jr. VIP

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    Thanks for all the other replies in this thread, appreciate it.

    Thanks, I was thinking this method too.
    One thing I'm not sure about though, an ecommerce site will be so different than a content site. I don't know how to easily transition from a content site to a ecommerce, and I'm sure google probably wouldn't like a complete make over as well. The front would also go from content to more of a store feel.

    I actually bought faucetreviews.com too, so I could do reviews on products, then of course add mine and make them the best eventually lol.
    Now rethinking on what's the best way to go about it.

    And there is quite a range of products in the niche. There are some cheap as shit selling for shit, and other high end ones, and high end ones selling 2x as much just because they can. I guess it's no different than any other market. Anyways, I was actually thinking of doing two separate brands, one would be competitive priced, maybe a bit lower than other brands, then one would be considered high end, say where the one brand would sellt he product for $200, this would would go for $350. Even if it gets the rare bite, it's money in the pocket.

    Probably the best bet, as I've seen a lot of shady stuff already with my research. Expensive trip though, but probably worth it.
    Thing is if I look at my own products, I'm looking in the tens of thousands range. And that's quite a bit upfront for a business starting from scratch.
     
    Last edited: Mar 14, 2014
  12. tony_d

    tony_d Elite Member

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    Once you buy something, you're free to do whatever you like with it, including resell it. No license needed.
    http://en.wikipedia.org/wiki/First-sale_doctrine

    Yes, that link refers to US law, but all developed countries are the same.
     
  13. howard_hughes

    howard_hughes Elite Member

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    you'll have to keep in mind that a lot of people have already decided in their minds what brand "faucets" they wanna buy when they're buying it, so an online superstore should be a better idea. Thought the profit percentage will be less than having ur own imported products, the sales should make up for it.
     
  14. kbklash

    kbklash Senior Member

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    I think you need some sort of license,if you are doing it as a business.You can always resell any items you bought legally.But when it comes to business,you need to have a word with the manufacturer or their sales division,to be the official superstockist or reseller . So that your customer get the warranties that manufacturer provide to the first consumer.If you're using manufacturers' logos to advertise the products you're reselling, you need their permission.To keep ourself out of the headache of trademark infringement lawsuit.And then you might need sales tax ID number,SSN,VAT (according to your country).Correct me if i am wrong.
     
  15. tony_d

    tony_d Elite Member

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    Negative - you are free to resell anything you buy.

    Of course. If you want to be an official dealer you need to do as you said, but the question was whether a license was needed.

    Absolutely... you create quite a significant liability if you (without license) use a trademark to which you have no right for your own commercial benefit (ie, advertising).
     
  16. jascoken

    jascoken Senior Member

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    Developing a full business-model is an entirely different proposition to building a marketing vehicle.

    As some of the others have said, stick to what you know and build the marketing vehicle (website and tarffic). Use someone else's business model to supply the customer. Unless you've got the specific experience, as well as the financial situation to develop a complete business model, you'll most likely come unstuck.

    If you really want to develop your own business from the ground-up, then expect to invest a LOT of time, money and effort for several months. It'll be a step learning curve. I'd never tell anyone NOT to do it; it's what I've been doing for the last 15 years, but it was HARD work and I was in the right financial situation to do it. I've built 7 businesses over the last 15 years, and it's NEVER as easy as you hope!
     
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  17. jon_xx_x

    jon_xx_x Jr. VIP Jr. VIP

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    Well it's hard to explain but it's not a huge market with a go to brand. So that's one of the reasons why I wanted to establish my own brand.

    Yeah I hear yeah, and I know it, probably don't give it as much attention as I should, it's good to hear it from someone else.
    I know it's a ton of money and time. I'm just excited I have this domain and really want to turn it into something big. I think I can turn this into a $1M+ year business. Where as I go typical content, maybe some reviews, affiliate or reselling, just seems small for what I want with this domain. And like you mentioned, it's two different models and really it's two different mind frames. If it's my own brand/company, I'm looking for press, create a buzz, etc, where as if it's just a content type site, there are always a lot of sites like this out there, and hard to get links. And of course I don't want to penalize this domain so i want to go white hat.

    Thanks everyone for all the help.
     
  18. jon_xx_x

    jon_xx_x Jr. VIP Jr. VIP

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    I need some opinions, have a bit of a freak out lol.
    So I've built up two sites over the last week, waiting on content from my writer for one.
    I made a review site which I'll have a ton of reviews on, and made an actual online store.
    The store to start I'm going to sell other company's products. Most of them drop ship so very little costs on my end.

    Now for the most part, these products are coming from China. Few different manufacturers and companies just putting their own logo on them.
    And there are a handful of online stores selling the products.
    Now my little freak out is, if I'm selling the same products as everyone else, how do I differientiate myself? How do I set myself apart from these guys who have been doing it for years now? Just out market them? Out rank them?
    Originally when I was going to have my own products it seemed like I would be different. But now it seems like I'm just another online retailer.
    I guess all online retailers have the same problem, a lot sell the same products, and have to out market/rank the competitor.
    I don't know I think I just over think everything and I'm worrying about too many factors.
    Speaking of which, profit margins are pretty good in this nice. But all it's going to take is some jackass willing to make $10 per sale and undercut everyone else. Then what happens?
     
  19. Gyuman82

    Gyuman82 Jr. VIP Jr. VIP Premium Member

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    You're going to have to outmarket your competitors because you're not going to beat them on pricing.

    Like you said you can't really price war these people as all it takes is someone undercutting the market (either you or competitors) which hurts the industry as a whole. (Basic economics)
     
  20. jon_xx_x

    jon_xx_x Jr. VIP Jr. VIP

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    What if someone comes along and undercuts everyone? I guess they stilll need to get their name out there. Just kinda shitty if it happens.
    I don't know, I just had a panic attack for some reason. Never had that before. I knew all along I just have to outrank/market them.