Wholesaler prices lately.

[oscar21]

What is it with the recent prices I'm getting at wholesalers, just about everything anyone quotes now is about 20% dearer than I can get things for retail. Take today, I needed some conduit, saddles etc so went to a wholesalers round the corner, I don't use them very often but I know the lad who served me quite well so its not as if I'm a randomer off the street. the bill was about £100 but doing a bit of research this evening it turns out I could of got the same stuff for about £75 from Toolstation or Screwfix etc, or slightly cheaper if I ordered it on-line.

Its the same with our regular wholesaler, they are getting so expensive I hardly ever use them anymore, luckily I'm quite organised so get most stuff on-line now from various places. But these on-line places still have trade counters and physical stores, they are basically wholesalers just like the ones I use but selling on-line as well, if they can sell for that price so can the one I use. I son't see any sense in it, eventually everyone will do what I have done and just buy on-line.

I wouldn't mind but on-line is brilliant, you can order whilst sat in the bath, it arrives anywhere in the country the next day, is the cheapest option and vary rarely does anything go wrong. Wholesalers will be a thing of the past if they don't change track soon.

 

[Dustydazzler]

You make my point very well if your 'usual supplier' works for you.

As an aside; that supplier sounds very much like an electrical wholesaler, albeit one that operates online and eschews the costs associated with stockholding in multiple locations.

I rarely buy from wholesalers, preferring instead to be well organised and well stocked, but that's easy for me as my own work is mainly domestic for which materials are readily available at low cost. The contractor I mostly work for could never hope to operate in the same manner, due to the huge lists of material that someone would need to spend countless hours pouring through to find the best options.

Maybe it's different over here, where delivery of large and heavy goods can be more problematic, but I struggle to imagine many sizeable industrial jobs being organised on the basis of materials sourced from multiple online stockists or ebay and it's precisely this sort of work in which wholesalers excel.

On large commercial jobs / industrial jobs I don't think the price of materials is such an issue as it is in Domestic where customers are counting every penny ?
I do some work for a sports centre and I reckon I could bill them £100 for a metal clad double socket on the materials part of my final invoice and they wouldn't bat an eyelid and just pay it.
Trying charging a home owner the same and they would start checking the price on Screwfix website

 

[Rockingit]

You make my point very well if your 'usual supplier' works for you.

As an aside; that supplier sounds very much like an electrical wholesaler, albeit one that operates online and eschews the costs associated with stockholding in multiple locations.

Exactly. All that's happened is that the independants have upped their game online. That, and quite often manufacturers will hold stock at themselves rather ship out to the middleman - so if I want to sell cable clips and I reckon I can shift a million of them a year at 2p each, I buy a million clips from the factory at 1p (or a factored promise to buy) except the factory keeps them and each day I have a system that tells the factory where to ship a thousand clips at a time to. I have no warehousing or staffing costs in that process and still make 50% profit.

 

[nicebutdim]

On large commercial jobs / industrial jobs I don't think the price of materials is such an issue as it is in Domestic where customers are counting every penny ?
I do some work for a sports centre and I reckon I could bill them £100 for a metal clad double socket on the materials part of my final invoice and they wouldn't bat an eyelid and just pay it.
Trying charging a home owner the same and they would start checking the price on Screwfix website

I get what you're saying and agree that such an extra would be trivial in the grand scheme of things, but price of materials will be critical in terms of winning quotes and making profit.

Quote for the wrong cable spec and you might find youself going from making a decent profit to weeks of work at a loss.

 

[nicebutdim]

Exactly. All that's happened is that the independants have upped their game online. That, and quite often manufacturers will hold stock at themselves rather ship out to the middleman - so if I want to sell cable clips and I reckon I can shift a million of them a year at 2p each, I buy a million clips from the factory at 1p (or a factored promise to buy) except the factory keeps them and each day I have a system that tells the factory where to ship a thousand clips at a time to. I have no warehousing or staffing costs in that process and still make 50% profit.

I first encounted a similar situation, several decades back, in a different industry. The company I worked for provided engineering services and was also a wholesale distributor. They were sole distributors for some very desirable brand names, but also stocked a range of better priced options and no competitor could ever manage to break their market dominance.

Finally a competitor began making some real progress and we couldn't understand how they were managing to offer such keen prices. Turned out they struck distribution agreements with several manufacturers that allowed them to work on the basis of 5% commission. In order to make it work, stock was held locally and the manufacturers retained title of goods. What the local distributor hadn't factored was how much warehouse space they'd have to dedicate to large, low volume goods and also how much skill was required to maintain reasonable levels of stock when dealing with the perpetual holiday situation that is Italian manufacturing.

 

[LukeD]

I wonder how many small /medium suppliers will just give up? I have one near me (BEM , North London) What keeps them going is mainly accounts .The account holders need that "credit period" so dont mind paying a bit more in some cases .I dont want credit and never had a proper account .I always pay as needed .Its a lot easier and less riskier ?

 

[ipf]

I wonder how many small /medium suppliers will just give up? I have one near me (BEM , North London) What keeps them going is mainly accounts .The account holders need that "credit period" so dont mind paying a bit more in some cases .I dont want credit and never had a proper account .I always pay as needed .Its a lot easier and less riskier ?

I understand your reasoning.
In commercial and industrial, it's generally a case of waiting for money coming through, though. It's a bleedin pain, alright.
It's Ok saying 'Oh, I don't work unless paid immediately', but in industry it just doesn't work that way. That's why wholesaler accounts with payment after a couple months are a must.
Working on a one to one basis with payment on the spot is great for any small domestic business, especially those who aren't VAT registered.

 

[LukeD]

I much preferer a McCafe Latte over Starbuck , Costa , Nero anyday

Blank Street Coffee - https://www.blankstreet.com/ If ever you get up to London .

 

[oscar21]

The funny thing is, I work in a few different areas and its the independent type wholesalers that are usually the best with pricing, I walk into them with a fear that I'm going to get shafted but they always seem to treat you great, I managed to get a Crabtree shower pull from an independant the other week and it was the cheapest one I've ever bought. Its the "chain" type wholesalers that always try to shaft me even though some of them already have my details as I use other branches so its not as if I'm a stranger to them.

 

[ipf]

I much preferer a McCafe Latte over Starbuck , Costa , Nero anyday

Is that because you get free ketchup with it?

 

[DPG]

I much preferer a McCafe Latte over Starbuck , Costa , Nero anyday

Now Starbucks and Costa - that's profiteering!!

 

[nicebutdim]

The funny thing is, I work in a few different areas and its the independent type wholesalers that are usually the best with pricing, I walk into them with a fear that I'm going to get shafted but they always seem to treat you great, I managed to get a Crabtree shower pull from an independant the other week and it was the cheapest one I've ever bought. Its the "chain" type wholesalers that always try to shaft me even though some of them already have my details as I use other branches so its not as if I'm a stranger to them.

I'm not sure why you think they're trying to shaft you. CEF are one of the most well known nationally, and I'm not exactly a fan of their pricing or often lengthy wait at their counters, but they advertise all prices on a website.

Independents and just as the name suggests and free to price goods as they see fit. National wholesalers will have policies, to which staff are obliged to adhere. You and I might not understand or appreciate those policies, but it's likely that they benefit the business. Perhaps they feel it's only worthwhile taking the time to deal with small orders at list price, whereas sizeable accounts are profitable enough to warrant decent discounts? I honestly don't know but, at the risk of repeating the same points, they have significantly higher overheads than online operations and can't hope to match the buying power of large retail chains.

Spend your money where you see fit and don't think too much about how other business owners choose to run their operations.

We buy groceries in Lidl and Asda. I couldn't care less about the prices in more expensive supermarkets.

 

[oscar21]

I'm not sure why you think they're trying to shaft you. CEF are one of the most well known nationally, and I'm not exactly a fan of their pricing or often lengthy wait at their counters, but they advertise all prices on a website.

Independents and just as the name suggests and free to price goods as they see fit. National wholesalers will have policies, to which staff are obliged to adhere. You and I might not understand or appreciate those policies, but it's likely that they benefit the business. Perhaps they feel it's only worthwhile taking the time to deal with small orders at list price, whereas sizeable accounts are profitable enough to warrant decent discounts? I honestly don't know but, at the risk of repeating the same points, they have significantly higher overheads than online operations and can't hope to match the buying power of large retail chains.

Spend your money where you see fit and don't think too much about how other business owners choose to run their operations.

We buy groceries in Lidl and Asda. I couldn't care less about the prices in more expensive supermarkets.

Its because wholesalers should (and used to be) the go to place to get your stuff. If you were a DIY'er you went to B&Q or more recently screwfix/toolstaiton, if you were in the trade you went to a wholesaler and got things cheaper than the DIYer or householder so you could make a markup on it which paid for the time and effort of sourcing it and getting it.

Nowadays wholesalers are just a retail outlet trying to maximise their proffits in any way they can.

 

[pirate]

Starbucks and Costa...best example ever. There's a book about it, and it makes interesting reading. I am fortunate with my occasional work, so I don't have the hassles of wholesalers and 30 or 60 day credit, however I well remember the collapse of a huge contractor in Scotland who just went bust owing hundreds of small businesses lots of money...the Laff**ty group killed so many small guys, and nothing could be done. Rule One: Do not put all your eggs in that one basket.
Rule two: If you do occasional stuff, get paid for materials up-front...or at least before they are installed.
My local jobs are for a few clients. They ask for a quote, I give it, and if they accept it I bill them for the materials, and once that's paid I do the work. They always pay me my labour costs promptly because nothing works until I am paid...I have the "key".
The beauty of this model is that they know I will do the job properly, so they don't fek about when it comes to paying.
Thus, wherever I buy the cable or other accessories, the cost, without uplift, is the price I have paid to the supplier, which is important to the client, particularly when the customer is a charity.
The only possible points of contention are:
1. The supplies might be cheaper elsewhere
2. I am too expensive
Given these are small jobs, point 1 is not really significant, so if they want me to leave them with the last 5m of a drum of t&e, so be it. It may come in handy for the next job on their site. They've paid for it, so it's theirs.
As for point 2...well, it's their choice...as my jobs are usually small ones, they either take my price or leave it. £200 or £300, it's nothing really.
I fully appreciate my situation isn't the most common one, but thought it might be worth mentioning it, because as a model for business, it suits me very well and may suit those who are not working 24/7 to support a family, such as a retired bloke like me who does it for fun.
I go to Screwfix and pick up the cable and accessories...ok, it's £20 more than last week...but it's only £20 on the bill.
For those who do huge contracts, that's a big problem. If you are buying 10 drums of 2.5mm, or 100 drums even, there's a huge cost differential. If you stick to small jobs, the cost isn't too significant.
Small is beautiful!

 

[nicebutdim]

Its because wholesalers should (and used to be) the go to place to get your stuff. If you were a DIY'er you went to B&Q or more recently screwfix/toolstaiton, if you were in the trade you went to a wholesaler and got things cheaper than the DIYer or householder so you could make a markup on it which paid for the time and effort of sourcing it and getting it.

Nowadays wholesalers are just a retail outlet trying to maximise their proffits in any way they can.

Wholesalers haven't changed, but you have and so has the world. Wholesalers are doing what they have always done.

 

[LukeD]

Wholesalers haven't changed, but you have and so has the world. Wholesalers are doing what they have always done.

UK should be like certain parts of the world .where many items cannot be sold to members of the public as id has to be shown .mainly gas, water and electrical stuff . And should a client ever pull out a screwfix etc catalogue out and question a quote it would be 'Have it all here the day before I start work .None of it will carry any form of warrantee from me and anything missing or wrong needs to be sorted out by you and if necessary a hourly rate will be charged if it slows down the job."


You dont take your own meat and veg to a restaurant !