A Fin24 user writes: I'm buying reinforced steel from one of the big suppliers in the country.
I have recently been receiving quotation requests from small contractors like myself.
How can I turn these requests into a profitable business?
Ian Reid, CEO of Platinum Black Consulting, responds:
It is indeed an exciting and a scary time.
The first thing you need to address is: what makes your products - and so your business - unique or different or better than the rest?
If you can identify that, you can work on maximising that unique factor to grow your business.
Three of the important business factors you have to consider here are:
1. Cost of the reinforced steel - and your costing (it must be market related)
2. Stock holding that you must hold - if you have to.
3. Convenience of delivery - for your clients.
The experience for your client must be a GREAT one.
He must want to deal with you and it must be easy for him to do so.
Your quotation must look at your cost of material, the transport, labour and any other cost you may have, and then add a (small) mark-up. That will give you the price to your client.
If you are VAT-registered, remember to add in the VAT.
Always keep in mind that your industry is a very competitive one, so service and delivery must be great to make you stand out above the other smaller businesses like yours. That will make your client come back to you again and again.
You can turn the request into a profitable business by doing your costing correctly, and ensuring that your clients’ experience is really good in all areas: ease of quoting, delivery, feedback from client and a competitive cost.
Do research to see what other small suppliers are charging, and see if that pricing can work for you.
This is an exciting time, but knowing your market, correct pricing and excellent service should allow you to start growing the business profitably.
Good luck - and please give us feedback at Fin24 as you go along this exciting path.
- Fin24
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