The goWholesale Blog

The Great Consumer Schism - Tips for Brand Name Retailers

April 28th, 2008

It’s begun. The Great Consumer Schism is effectively working its way through America-an event last experienced in this country in the ’70s. Economic disparity in America is nothing new. But in times of recession the division is inflated and even more apparent as seen through shifts in spending habits. It makes perfect sense of course that middle to lower income households are switching from brand name items to generic in order to save a few bucks.

So what does this mean for retailers? Well, if you sell cheaper products, this is great news! If you sell brand name (and therefore more expensive) products you may want to reconsider your strategy. Here are a few suggestions:

These are just a few ideas to get you started thinking in the right direction. For more tips check out Don’t Let a Slow Economy Slow Down Your Business

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Internet Sales Tax Looms for NY…Will It Catch On?

April 24th, 2008

Interesting…very very interesting.

Do you think states should be allowed to levy a sales tax on online purchases?

Well according to a WebProNews.com post, New York is attempting to test those waters. Legislators are trying to pass a bill titled the “Amazon Tax” and are targeting online retailers who are not located in New York. The sales tax would be attached to any items shipped to the state. Proponents of the bill say it will help level the sales tax playing field for brick and mortar retailers and they estimate it will generate around $50 million in tax revenue for the state.

Opponents claim the tax is being introduced due to miscalculated spending and that this tax is being invented to compensate. Large companies such as Amazon have reviewed the bill and believe it will be challenged in court.

Thus far, the government has been reluctant to allow states to regulate internet transactions.

What do you think?

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Fuel-enomics: 10 Tips for Small Businesses as Prices Continue to Rise

April 22nd, 2008

Crude oil prices are up 16% already this year and show no signs of slowing down. So without further ado and straight from the dailybreeze.com here are 10 great tips on how small businesses can deal with the soaring gas prices:

1. Add a separate fuel fee. Call it a fee, call it a surcharge - call it whatever you want. But more and more small businesses are tacking on a special charge to offset the cost of gas. Customers may not be happy, but most understand since they’re dealing with the same situation themselves. They don’t expect small businesses to absorb gas price increases forever.

2. Restructure your pricing or territories. Some businesses are restricting the areas they serve, or charging more to go out of area. Others are raising minimum charges or putting tiered pricing in place to compensate for having to travel greater distances.

3. Use an outside shipper. Small businesses that once delivered small supply orders themselves are finding it cheaper and more efficient to send things via UPS or the postal services. In many cases, items arrive in just a day or two. Shipping services Web sites such as RedRoller.com can help you find the lowest-cost carrier.

4. Leverage the Web. Show customers how buying online and by mail order can save them money by not having to visit your location. Use Web-based collaboration sites to “meet” with clients, freelancers, partners and others rather than meeting in person. A few choices include Zoho, Basecamp and WebEx.

5. Hop into a hybrid. A few years ago, there were only a couple of hybrid models to choose from. Now there are dozens, including SUVs and vehicles suited for small-business needs. Even if you don’t get a hybrid, lighter-weight vehicles and those with smaller engines may be far more fuel efficient than what you have. If you plan to switch, a great place to compare fuel efficiency information is at FuelEconomy.gov.

6. Charge by the mile. If your business or profession allows for it, a per-mile charge might work best. This allows for small adjustments whenever needed. The standard IRS mileage rate for 2008 is 50.5 cents per mile, up from 48.5 cents in 2007.

7. Drive less. Have your suppliers deliver items you need to your business rather than picking them up yourself. Use online map-routing services like MapQuest.com to plan service and delivery routes better, for maximum fuel and time efficiency. Group jobs together to reduce travel.

8. Get rebates on gas purchases. Gas rebate credit cards are increasingly popular with small businesses and can net you cash back of up to 6 percent on what you spend. The higher fuel prices go, the more you get back. Just be sure you pay the bill on time, or interest charges will more than eat your savings. Find gas rebate cards at CreditCardGuide.com or PumpandSave.com, which currently lists the Discover Open Road card as the best deal with 5 percent cash back on all gas and auto maintenance.

9. Find the cheapest gas. While it doesn’t make sense to drive far to save a few pennies, there can sometimes be a surprisingly large price difference just a short distance away. GasBuddy.com and GasPriceWatch.com are two Web sites that specialize in helping find the cheapest gas in your area.

10. Follow fuel-efficient driving tips. You’ve probably heard them - avoid jackrabbit starts; keep tires properly inflated; run air conditioners less, keep vehicles tuned and air filters clean, etc. WikiHow.com has a long list of ideas for “How to Save Money on Gas.” Search the title at the site.

For more tips check out Oil prices are going up–ways to cut down on the business energy bill and Little Cost-Cutting Tips that Add Up to Big Savings.

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There’s a New Credit Card Scam in Town

April 18th, 2008

It’s almost like that gopher pounding game at the carnival. As soon as you bop one on the head another pops it’s mocking little head out of the hole which you must smash into oblivion…and so on and so forth for what seems like forever. Just as law enforcers find a way to prevent a crime, criminals find another way to commit it. We often stereotype criminals as dumb but in reality, in order to be a successful criminal you have to be smarter than the system that’s designed to keep you from violating it. It’s the nature of the beast I suppose and they’re back at it again.

In what is termed “credit card shaving” people buy gift cards or take stolen credit cards and test a 16-number sequence either by trying to make a purchase online or by calling a verification number the way merchants do. The scammers then scratch up the new card’s magnetic strip so a store clerk has to enter the numbers manually, what’s called “forcing a transaction.”

The result is a card that ends up looking like it went through the ringer a few times but apparently merchants are accepting these cards. The people who’s accounts the numbers match up to are left dumbfounded as to how their card information has been stolen because they still have their cards and no mail has been stolen from them…it’s a sheer case of dumb luck. And its taking off.

As a merchant, you can help customers by not accepting suspicious looking cards as well as cards with inoperable magnetic strips. This seems like common sense but the scammers tend to target low end small businesses where customer traffic is heavy. Just be sure you remain diligent and educate your employees to do the same.

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Crazy Breakfast Making Cell Phones - Part II

April 16th, 2008

Okay, don’t freak…there was no Part I so don’t go looking for it. Well, there sort of was…this is simply an addendum to my previous post Oh So Textual! *Text Message Shopping Has Arrived*.

When you bought your cell phone did you ever imagine that one day it would allow you to pay for things? No seriously, your cell phone as a form of currency? Yeah, neither did I. But now you can. I know! It’s nuts!

Ok, so here’s how it works (courtesy StorefrontBacktalk.com):

Step 1: You download an applet on your phone. Said applet would be associated with a payment method, a password, and possibly another form of authentication.

Step 2: The retailer would have a piece of compatible software installed in their POS system.

Step 3: You shop in the store as you normally do, picking out items for purchase. When you’ve selected you bring your items to the cashier.

Step 4: The cashier scans the bar codes of your items and tells you the total.

Step 5: You enable the mobile payment app, type in your password, and punch in the exact amount of your total.

Step 6: If all goes well up to this point, the app will display a bar code that the cashier would then scan with the same bar code wand as they used to scan your products. The bar code would include the exact amount, a date/time stamp and expire within 60 seconds in case you want to abandon the purchase.

Here are some of the other things it would do:

And here’s the kicker for merchants:

Yeah…that’s awesome.

For the rest of the the StorefrontBacktalk.com article, including the reaction of the National Retail Federation and others click here.

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Hula Girls - The Original Organic Fashionistas

April 15th, 2008

Grab your coconut bras and grass skirts and jump on the organic textiles bandwagon! More and more retailers are beginning to cater to green fashion and it would appear that it’s more than just a fad.

The reason for this? One day not long ago some forward thinking entrepreneurs realized that people will spend bucket loads of money on fashion…so why wouldn’t people do the same for organic clothing as well? They looked around and said to themselves “the only organic clothes available look like burlap sacks!” “Ces’t tres horrible!” they gasped in unison, aghast at the utter disaster of the whole situation. And thus the organic fashion revolution began. (and this obviously happened in France because that’s where the best revolutions take place…at least in fashion, right? and I think Al Gore was there too…)

**note the above story is purely hypothetical in nature and should be regarded as mere imagination on my part as to how this whole thing began…but however it happened, it’s here.

Now companies such as Linda Loudermilk and Figleaves.com are selling$230 bamboo jeans and100% organic cotton undies for $28. While the prices may seem steep there appears to be a market for these items…and it’s growing.

So if you are a would-be entrepreneur looking for an idea, use this as a starting place. The market has scarcely been tapped and if you play your cards right you might just get in on the ground level of a phenomenal retail trend. Plus, with more and more people becoming interested in this niche, someone’s bound to come up with a new way to manufacture these goods for the masses…will it be you?

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Oh So Textual! *Text Message Shopping Has Arrived*

April 7th, 2008

I remember the days when cell phones were exciting because they were cordless AND you could use them past your front porch without it crackling and buzzing you deaf. Then came the ringtones. And the cameras. And the text messages, email, internet, music and video. I can’t afford the latest and greatest (mine simply allows for phone calls and a few texts) but when they add a “Makes You Breakfast in Bed” feature I’ll seriously consider upgrading.

But as is, I, along with countless others, still possess the capability of participating in text shopping, the latest service offered by Amazon.com called TextBuyIt. Here’s how it works (courtesy detnews.com):

“It lets people text the name of a product, its description or its UPC or ISBN to 262966 (that’s “Amazon” on the keypad) from anywhere their cell phones work — including from inside physical stores.

If Amazon stocks matching items, the service returns two results at a time. Shoppers can immediately buy one of the first two the selections by texting back the number “1″ or “2,” or they can ask for more by texting the letter “M.”

New TextBuyIt customers will be prompted to enter the e-mail address associated with their existing Amazon account plus a shipping zip code. The service then calls them and walks through the checkout process using an automated voice system. Shoppers get confirmation by text message and e-mail.

From there, the customers can check on order status on Amazon’s Website.”

First I just have to say that I think this is pretty awesome–as a consumer that is. I keep thinking that there is no way things can get easier and lo and behold, someone finds a way. I’m not so sure I would use this personally (remember, I’m too cheap to upgrade to a cooler cell phone so I’m not exactly a ’shopping on demand’ kind of person) but I do know that this service will likely be widely accepted by shoppers and replicated and perfected in different forms by Amazon’s top competitors.

So what kind of effect do you think this will have on brick and mortar stores? Or small businesses for that matter that do not possess the capabilities of offering such a service in order to compete with Amazon?

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Posted in E-Commerce and E-Business, In the News | 2 Comments »

Times are lean, all the more reason to go green!

April 3rd, 2008

If you haven’t already been bombarded by all the wonderful and practical reasons you should take steps to making your business more earth friendly, you might have fallen down a dark well and have no way of getting out. If this is the case and you are reading this, please email someone for help. And then explain to me how you are getting wireless down there.

If you fall into the other category (and hopefully that is ALL of you reading this) then you are familiar with this buzz phrase “going green.” I’m not here to repeat what we already know about the basics. So I’ll just skip ahead to the juicy details.

The “going green” craze has swept our nation and in the midst of it all has been a wealth of opportunity for environmentally oriented businesses not to mention creating a market for new ones to crop up as well. Unfortunately, in the area of solar technology, there hasn’t been much competition. Til now.

A recent article (which explains the ins and outs of solar energy in detail) from CNNMoney.com states that “several startups, including HelioVolt in Austin, Miasol in Santa Clara, Calif., and Nanosolar in Palo Alto, are working on a new technology called flexible thin film that’s on the brink of making solar more competitive.” And you know what that means? It means that these companies are going to work harder to produce the best solar product and we all can benefit from this (including Mother Nature).

Solar power has been two to three times more expensive than traditional energy methods but with these companies working on a cheaper way to convert solar energy into usable energy, lower energy costs are dangling right in front of us. So check out this new solar energy technology as I’m sure you’d rather spend company funds on actually growing your business, not just powering it.

For more tips check out an article by our small business expert, Steve Strauss: Why Going Green Is Good For Business

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There’s a Pot of Gold at the End of the Legal Rainbow

March 17th, 2008

The Regulatory Flexibility Act was passed in 1980 but continues to prove that it is a valuable piece of legislation for small businesses over 2 decades later. The act is designed to make federal agencies evaluate how their regulations will impact smaller businesses and then look into how to make it easier on them economically and still comply with the regulation.

The Small Business Administration recently released a report on how the RFA did in 2007. The results showed that it has “realized $2.6 billion in first-year cost savings and $285 million in annually recurring savings.” How’s that for good news?!

For those of you who believe that the corporate world has our government wrapped around their big fat fingers, well, just remember that there is always a segment of the government devoted to making sure that small businesses survive and thrive.

And there, my friends, is your pot of gold.

(If you’d like to read the whole report, click here)

Happy St. Patrick’s Day!

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Credit Card Fair Fee Act

March 11th, 2008

For years now, consumers have enjoyed the benefits of being able to use their Visas, Mastercards, American Expresses, etc. practically anywhere there are things to buy. Consumers sign up for credit cards to pay off other credit cards and with the ease and accessibility of online shopping, the credit industry is booming.

What consumers don’t know (or didn’t) is that the cozy relationship between merchants and credit card companies, isn’t really all that cozy. Up until now, credit card companies have imposed what is called an “interchange” fee on merchants every time a consumer uses a credit or debit card to make a purchase. These fees are calculated independently by the credit card companies and are effectively hidden from the consumer who also ends up paying the fees in the form of product mark ups. The average cost per household is $350 a year. The total amount of interchange fees Visa and Mastercard collected in 2007? $42 billion.

Well, now congress is involved and things are looking up for merchants and consumers alike. Last week, House Judiciary Committee Chairman John Conyers, D-Mich. introduced the Credit Card Fair Fee Act. This proposed legislation according to the National Retail Federation website (who is, in fact, leading the campaign for the approval of this legislation):

“The Conyers bill would require credit card systems possessing “substantial market power” to negotiate with merchants to reach a voluntary agreement on credit card terms and conditions. If an agreement cannot be reached, both sides would be required to submit to binding arbitration by a three-judge panel appointed by the Department of Justice and Federal Trade Commission.

The arbitration proceedings would take place with a limited 60-day discovery period and other statutory deadlines, and the judges would be required to apply a market standard reflecting a perfectly competitive system where neither side had market power. Terms and conditions set by the panel would be in effect for three years, at which time the process would repeat itself. Both sides would receive limited immunity from antitrust laws in order to participate in the process.

The legislation requires that terms and conditions set under the process be available to any merchant regardless of size, industry or location. Individual merchants or groups of merchants would remain free to negotiate voluntary arrangements with credit card companies and their banks.”

The legislation is coming about in response to a hearing in July 2007 where the NRF argued that the credit card interchange fees violate antitrust laws. If it goes through, consumers and businesses alike could see an impact on how much money they save. Stay tuned…

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