Distributor cancelled an order and we need to move 30k bags of coffee [updated]

Post by merb » Fri, Dec 30, 2022, 7:34 PM UTC

chadash wrote: post #169

merb wrote: post #154

who even thinks that 6000 units will be bags. I mean considering that we are talking about food distribution it can't be bags. now consider aldi in the us or in germany, it has over 2k stores, consider it will send 50 bags per store (which is not a lot, but that would probably be around 2 cartons, which is fine for a start or special) it would only be possible to send it to around 120 stores, so why should they even…

When you sell to a big chain, they don't necessarily put the products in every store. I have a friend in the food business and when he was getting started, the big chains would put his product in a small number of stores to see how they sold before putting in larger orders.

Post by bombcar » Fri, Dec 30, 2022, 7:34 PM UTC

brookst wrote: post #92

okr wrote: post #55

Earlier quoted context omitted.

I liked the example, it illustrates it from a different perspective. However, why not paying daily? Hourly? Minutely? In the age of computers...

Even in the age of computers each transaction has a cost and a risk associated. And there is no upside to large companies. They don’t want to receive per-minute payments any more than they want to send them. So if 95% of a business’ volume works one why, why invest in making 5% different just to deal with smaller vendors, who are already more difficult to deal with (for 100% good reasons).

Post by tinus_hn » Fri, Dec 30, 2022, 7:35 PM UTC

manv1 wrote: post #161

Inventory financing is a severe pain in the ass for small businesses. It makes moving up to the next level incredibly difficult. Math example: You sell something for $20, and it costs you $5. You have free shipping, which costs you $3. Shop and CC fees are maybe $2, so you're netting $10. Then taxes means you net $6. So if you sell 10,000 units you've netted $60k. But to make that $60k you need to spend $50k up front…

Post by chasd00 » Fri, Dec 30, 2022, 7:38 PM UTC

ryoshu wrote: post #171

chasd00 wrote: post #129

Earlier quoted context omitted.

i've read comments like this before on hackernews. Are the payment terms not on the contract signed? It seems like something you'd really want to understand before starting a project...

They generally are, but if you say net 30 and set a % penalty for not paying in net 30 (common), when a multi-billion dollar corporation decides to do net 90 and won't pay the penalty, what are you going to do as a freelancer? Sue them? The amount of money you spend on legal fees would likely be multiples of the penalty fees. And it would delay payment further. Big corporations rely on this power imbalance.

Post by gamblor956 » Fri, Dec 30, 2022, 7:39 PM UTC

manv1 wrote: post #161

Inventory financing is a severe pain in the ass for small businesses. It makes moving up to the next level incredibly difficult. Math example: You sell something for $20, and it costs you $5. You have free shipping, which costs you $3. Shop and CC fees are maybe $2, so you're netting $10. Then taxes means you net $6. So if you sell 10,000 units you've netted $60k. But to make that $60k you need to spend $50k up front…