Sales channels, TV or Internet-shopping networks can for a small business owner with a great product boom or bust mean. I read yesterday that their sales of 9% in the last home shopping network (HSN) increased to 12 months. HSN, QVC, ShopNBC, Canadian shopping channel and many other format TV/Internet based sales channels offer companies with a convincing product sell the possibility of a huge number of products in a very short time. But as good as it sounds, small businesses must be with some the advantages and disadvantages of the sale of this type of distribution channels to make. Almost all shopping channels have contracts with similar provisions, which the small business owner should be aware of. The shopping channels are pretty good at picking to sell good products by their format and they are well measured how many 5-12 minutes can sell them for each segment, the it your product in show but they dont care, if you stuck with a large number of products, not to sell. If you sell on a shopping channel network, which you see a broadcast method sell but not the language call it in their agreements. Specify, how many items need to have to sell for them, but if they do not sell, and you want to perform a repeat show, then you agree, to take it all back. Some in the industry call this a consignment sale. You agree in General, numbers in net after sale, so that you will have spent a large amount of cash front to produce 30 conditions or purchase your were, have it sit in the shopping channel warehouse in idle and wait more then 30-45 days until you are paid. If you have not enough money to cover these costs you have to find it. Sales of the shops are usually cannot be financed. The reason is that the nature the guaranteed sale it is as a broadcast. You will not transfer, title property as would, if you have been sold to many traditional retailers. If you a loan secured by other collateral or bills, then you are probably that one can get not only for this project. If a shopping channel first try your product requires they will do so on a small scale. These channels run 24 hours a day. You can get your first shot at an audience at 2:45 am. While that may be no bad time for your product, it can be also terrible. Timing and number of units taken tend to be non-negotiable. Shopping TV-station contracts tend to "Friss oder stirb", which means you have very little skill to negotiate conditions. I have never bought anything from a shopping channel, but understand she have a very friendly return consumer policy. Vendors selling products through networks shopping must either return the product or simply issue a credit. You have no control over the shopping channel network return policy. I have a friend, specializes in getting its customers products in the shopping channel networks. He has been very successful over the years with shopping channels as a network and makes his rounds on all of the procurement network at least quarterly home offices. He is a big proponent of such distribution channels for the right kinds of products, but he wants to read also his customers and to understand the fine print of typical shopping channel contract. Sam Thacker is a partner in Austin Texas finance business solutions.
Direct e-Mail: sam@lesliethacker.com
Twitter: @ SMBFinance
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