04 Nov Insights for Online Retailers
Insights for Online Retailers
Brent Dill of GreatBuy.com
In an increasingly global marketplace, online sales have long become the way to go for many retailers. Brent Dill of GreatBuy.com has been in the merchandise resale business since 1984. Before the days of the Internet, he had launched his business with the now old-school model of mail order catalog sales and quickly expanded to a retail storefront once his sales grew fruitful enough. Several years into his retail store business, Dill was met with a new challenge: acquiring new customers and growing his business. Mail order catalogs were slowly going out of style and, being set up in a small town, his retail store did not have the foot traffic necessary to bring him the profits he desired. “Our retail store did okay, but due to the small population here, it made sense for us to look for ways to expand our reach,” Dill explains. GreatBuy.com began selling online in conjunction with their retail store and eventually moved fully to online sales where they currently do all of their business.
“We sell primarily through 3rd party websites – namely eBay and Amazon.com. This allows us to move our product without spending money on advertising, since these websites do their own publicity,” says Dill. Indeed, launching a website can be a daunting task and getting it to rank high in internet searches without the proper optimization can require a business owner to spend a hefty sum on pay per click and banner advertising to get the word out. Utilizing 3rd party websites allows sellers to get a lot of exposure for their products spending money only on the listing and selling fees, and simultaneously benefiting from the credibility and loyal customer base that these 3rd parties have. “Selling on eBay and Amazon eliminates the need for you to prove to customers that you’re a legitimate business,” says Dill. “Since they have such a large customer base and buyer protection plans in place, there is a lot less hesitation on the part of the buyer to bid on or buy your items.” This presents a great opportunity for new sellers especially, who do not yet have the credibility in place to launch a full-fledged website of their own.
GreatBuy.com currently sources their products from 10 to 15 different wholesale suppliers. Dill explains that he prefers to work with multiple suppliers rather than just one or two. “Since the liquidation industry is so fickle in terms of what products are available at any given time, you need to make sure you have enough sources. If one vendor is sold out of something you need, you’d better have another place to go get it or your sales will suffer.” That said, it’s important to not work with just anyone. The liquidation business is rampant with brokers brokering other brokers’ merchandise and with companies just out to make a dollar without consideration for the customer’s real needs. “I always look for price, selection, quality and service when trying to determine what supplier to work with,” expresses Dill. “It’s important to feel that a supplier wants your business and wants you to succeed. That’s smart thinking and we prefer smart suppliers who like us, are in it for the long haul.” It’s easy to make a one-shot deal in this industry, but it does not often contribute to a long and successful business.
GreatBuy.com has been working with Via Trading for the last 6 years, purchasing a variety of merchandise including electronics, general merchandise and tools. “Electronics have become our best niche,” says Dill. “Customers can’t resist a great deal on an electronic item that they would pay top dollar for at regular retail.” When asked about how he differentiates himself from his vast online competition, Dill replies that “it’s all about the price. We try to be lower than other sellers for the same item. The cheapest price always sells.” This might translate into a lower profit margin on any single item, but it allows the company to sell more volume, which is ultimately more profitable than selling fewer items at a higher price per piece. “We try to provide the best price and the best service so that customers come back, purchase again and send their friends.” Just like the success of their business is built on volume sales at a lower profit margin, their purchasing process is very similar. “We typically buy loads at a time instead of individual pallets. It works out cheaper overall, though we do occasionally come across a single pallet that is too good to pass up in which case we’ll pick that up as well.”
Purchasing full loads at a time however, can be difficult to manage. While you can purchase loads by category, often times there will be items inside the loads that simply don’t fit a niche market or the exact categories a seller deals with. Furthermore, storage spaces can quickly become filled with items that are unsellable, missing parts or too inexpensive to sell online. While some Internet sellers shy away from buying full loads for this exact reason (they don’t wan to be “stuck” with a surplus of product), Brent Dill uses a different tactic. “I pull out the items that fit my market, and anything that doesn’t fit my niche or isn’t going to get me a good ROI, I resell at Via Trading on consignment.” Wholesalers like Via Trading make liquidation services available to their customers and other sellers to move slow-moving or unwanted inventory. Instead of sitting on problem merchandise indefinitely, wholesaling it through the original vendor or through an auction or liquidation service is an easy way to free up space and capital for the next load that comes in.
Over the years as their business has grown, GreatBuy.com has found that the biggest challenge they face on a regular basis is sourcing products that will sell at the right price. There is a consistent need to shop around and look for the best deals in order to remain competitive and true to their business model. “I’ve found that aside from great pricing on my merchandise, the one thing that pays off exponentially is treating customers and staff very well. If people feel valued, appreciated and respected, they work more efficiently and buy more loyally– which translates into a better bottom line for the company.”
Brent Dill is currently selling on Amazon and eBay.
Visit his website at greatbuy.com for great deals on electronics, tools and more.
All payment methods accepted. In-person pickup available from the Central Coast of California.