Buying Wholesale Fishing Lures To Resell Online

[Polarkraft05]

I am thinking about starting an ebay business, selling soft plastic fishing lures, since they keep their value fairly well. I have already somewhat started this business with some lures i got a really good deal on. But after these are gone I would like to buy more and keep selling. So far it has been a money making deal.  

 

my question is how do I go about buying new lures at a cheap enough price I can resell?

My parents have an incorporated business, although it is a construction business, I don't know if their business license would allow me to buy from the wholesale suppliers? Or if it would be legal to use theirs?

 

And what kind of price should i expect from these wholesalers? so far i have found some but cant see prices until I join their site, and to do so i must input my business license. With shipping, and ebay prices being lower than retail i will have to be sure I can make a profit before I commit to getting a license.

 

are the bags of soft plastics going to be around $.50 a bag or more like a dollar or two a bag?  

[deaknh03]

Most companies will not allow you to be a retailer unless you have an actual retail location or a legit web based business. I went thru this a couple years ago with a lot of the major manufacturers, Rapala, Jackall, etc, and they checked me out to make sure I wasn't just doing this to get a good deal on some tackle. They do have minimum orders of a couple hundred if you do get approved, and like the saying goes, it doesn't hurt to try..

[J Francho]

For Pure Fishing, all I needed was a Bus. License and Tax ID.  They have and initial buy in, and minimum orders, but you can buy smaller quantities at a discount.  Some companies have a HUGE initial order, like $20K wholesale.  Most will also do a credit check.

[slonezp]

Many moons ago I had a small webbased tackle business. I'm much better as a refrigeration mechanic. You'll need at the very least a tax id# The profit margins are not high and it will be difficult to compete with the larger internet retailers. You don't have a name in the tackle business and can't get the volume discounts they can.

[Polarkraft05]

I am looking into buying from wholesale distributors  they require a Business license and a resell tax ID, to keep the general public from buying just for good deals. But they don't have a minimum order. 

 

I'm just trying to figure out how much they charge before I go through the trouble of getting a resell Tax ID. If they charge too much and I can't make a profit, then it isn't worth the trouble.

[slonezp]

I sent the manufacturers a formal letter with a copy of the business license and a tax id. attn marketing/sales. I recommend not sending an email.I also included a link to my website. If they know you are serious, and not looking for deals, most will send you a pricing sheet with minimum order requirements or contact info for a distributor. At least you'll get an idea of the basic discount. I don't believe anyone will give you such info if you are just thinking about it.

[SirSnookalot]

An investment in a non brick and mortar retail outlet should be fairly minimal and necessary "paper work" easily obtained.  The major investment is in inventory, that amount is entirely up to you and how far you want to dive in.  My question would be, how many items do I think you'e going to move say in a month's time, and is the profit worth the effort.  I think there can be some good upside potential to establish a business, as in any business it takes devotion to make it go, it takes more guts than brains.

The only real negative I see in this type of an on line venture is creating a customer base in an environment where advertising is difficult and you're waiting for people to "walk into your store".  That said many others have done it, so it's a doable, nothing ventured......nothing gained.  I would not allow any negativity keep me from trying it, all you can lose is money and money is the most replaceable commodity known to man.

[Polarkraft05]

Thanks for all the help so far. I have been doing research and it seems it wont be hard to apply for a tax resell license with my parents business. Then I will just have to research the tax part of it. As far as I know since i am selling only on ebay it is perfectly legal to not pay tax on any sales unless the buyer lives in the same state as me.

Now I am just researching if this tax idea is correct. And also have to research MAP pricing, and which companies have the policy and how i go about complying with them.

 

So far the group of new/ old stock lures that i bought to resell has made me some money. If i can buy more at the same or close to the same price then I could make a part time business out of it. especially if there is no tax.  

[SirSnookalot]

I'm not a tax expert or an expert in interstate commerce but I would check with your own state on whether you need to pay sales tax, even for out of state customers.  I also would not use my parents tax id, I'd get my own, minor little details that should affect nothing.  As far as paying any fed, state income taxes, or even sales tax you would probably be required to do so, but, and this is only an opinion, a lot of the small business activity flies under the radar, no one will be furnishing a 1099, so you're on your honor.  When it comes to business, people are not as honorable as you may think, lol.

 

At the very least you'll gain some business knowledge, it sounds like this enterprise could be fun.

[J Francho]

If you want to move ahead with this, I HIGHLY recommend you retain the services of a lawyer and an accountant.

[papajoe222]

If you're only looking to sell small quantities similar to the ones you have been, e-bay is the perfect outlet and unless you plan on opening an e-bay store, there is no tax information you need to supply or that the site reports to the gov.

An initial investment can be a lot and if you happen upon an item that doesn't sell, you could end up loosing.  If you have a local Wal-Mart, Meijer, etc. in your area, I suggest you approach the sporting goods dept. manager and offer to purchase his end of the season merchandise at his cost.  You could then list as much or as little as you want and with a buy now listing, your listing can run for up to 30 days. 

I've been doing something similar with a large tackle dealer in my area and I only purchase the items I want now. At first, I didn't specify that I was only looking for lures, line, and upper end reels.  If you can deal in some volume and provide free shipping, a 50% mark-up is a decent profit.  If you go the entire business route, only 50% will guarantee the business will fail.

[Polarkraft05]

Well an update to my situation. I filed for a license and tax resell number, since they were near free to obtain. 

 

I have gotten three price lists from fishing wholesale distributors, but the prices have been barely under ebay prices. So for now, I am still searching for a distributor with low enough prices that i can make money selling on ebay. 

 

It surprises me some of the prices are barely under retail, while others are far enough under retail for a person to make some money, If they could sell the product at retail price, but items on ebay rarely sell for retail. 

[The Rooster]

I see you already applied but I was going to say that you can just use your SSN as your tax I.D. if you are a sole proprietor business and not incorporated. I also suggest getting a CPA to handle the taxes on any of this. I thought it was going to be expensive but it wasn't, and it was worth every penny to not have the hassle and worry of researching tax laws and proper filing of everything at the end of the year. Just keep a record of income vs. expenses, and receipts to back it up. CPA handles the rest. I do not sell online, but I do run a contracting business, and besides just services, I also sell an actual product in the continuous gutter that I do. I also have an interest in online sales of hand made goods such as fishing lures or wood craft items made in my shop. I'd set this business up just as I have done with my contracting, books and all, and use the same CPA.

[Long Mike]

A good CPA can keep you out of a lot of trouble that you never thought you could get into.  I know.  I'm married to one.  Only four more days and then I get to see her again in daylight.