At Trade-In Tech, we spend a lot of time and energy helping people start and grow their businesses. Along the way, we’ve learned and shown you a lot of information about what to do in the electronics industry. With that in mind, we thought it would be helpful to also mention some of the things you should not do as a business owner.
Some of the tips you’re about to learn can apply to owners of any company. However, we also included a lot of tips that are specifically relevant to companies in the electronics industry. Whether you’re a wholesaler, retailer, distributor, or you work in a similar position - we think that you’ll get a lot of value out of this post.
As an electronics wholesaler or distributor, you have a lot of things to focus on. This can make it easy to make mistakes. Unfortunately, these mistakes could be causing a lot of harm to your business. To make sure you avoid these problematic situations, watch out for these common mistakes electronics wholesalers sometimes make.
1. Partnering With the Wrong Companies
In the early stages of a business, partnerships are incredibly important. What’s also just as important is making sure you’re partnering with companies that can help your business. As you might know, there are a lot of potential companies your business could partner with. Considering that, we wanted to give you a quick look at the benefits that Trade-In Tech offers.
Trade-In Tech is a wholesale electronics platform that started in 2012. Since this time, we continue to build up a large membership of some of the most popular companies in the wholesale industry.
Coming from a wholesale background, the minds behind Trade-In Tech understand that wholesalers typically take part in a lot of transactions each day, month, or year. Because of that, we know that fees can begin having a huge negative effect on your company’s profits. On Trade-In Tech, you don’t pay any fees on transactions.
There are many other reasons to join Trade-In Tech. Because of our large network of members, our platform is the perfect place for electronics wholesalers. By making connections and sales on Trade-In Tech, your business can begin expanding much faster than normal. You can also have new connections to sell your electronics to.
What also makes Trade-In Tech a great partner to have is our strict verification program. This is our way of making sure that scammers and other people with bad intentions don’t become members of our platform.
2. Choosing the Wrong Business Structure
Before you can get too far in starting your company, you’ll need to choose a proper business structure. With that in mind, there are several possible options to choose from. If you’re going into business with someone else, you’ll probably want to form a partnership.
You might also choose to go into business by yourself. If this is the case, a limited liability company or sole proprietorship might be the best option. Many people choose to form a limited liability company (LLC) because your personal and business income remain separate. With a sole proprietorship, there is no legal difference between the company’s income and the business owner’s personal income.
If you so desire, you can also choose to start either a C or S corporation. Either of these company structures can be beneficial. However, some people avoid them due to the higher tax costs associated with forming a corporation.
While we know a lot of information about electronics and wholesaling, you’ll probably want to consult a legal expert before officially forming your company. By speaking with a legal or business professional, you can get advice regarding what business structure will benefit you the most.
3. Not Following News About What You Sell
We understand that owning a business can take up a lot of your time. However, it can be extremely helpful to dedicate some of your time to researching electronics. You don’t need to learn every single thing about this industry. But, it’s a good idea to keep up with news regarding the types of products you’re selling.
If you were someone that buys and resells iPhones, it would be helpful to keep up with any news stories about the smartphone industry. Armed with this information, you can learn when new smartphones are coming out.
Another great reason to keep up with prices is to more accurately price your electronics. When you’re staying aware of demand and statistics, it’s much easier to set accurate prices. Because you have these types of prices, neither your business nor its customers are getting ripped off.
4. Relying on Paper to Keep Track of Business Information
As you’ll soon learn, owning a business means keeping track of lots of information. With that in mind, some people grab a notebook or something similar to start writing down data. While there’s nothing wrong with doing this, it can quickly get difficult for most people to keep track of things with papers lying all over their desks.
If you’re looking for an easier way to start a business, consider keeping track of your company’s data on a computer. You can enter and track your company’s number-related data on spreadsheet programs like Microsoft Excel, Google Sheets, or OpenOffice. What’s also great about these programs is that you can use them from almost anywhere with an internet connection.
By using one of the previously mentioned types of software, you can ditch the stacks of paper and have an easier time tracking your company’s performance. Plus, having lots of papers all over the place is also a fire hazard. You’ll also find that using computers to create and store information drastically cuts down on both paper and storage costs.
5. No Online Presence
Another mistake that wholesalers can make is not having an online presence. This term means that your company has things like a website, social media pages, and other types of online networks. Without having websites or accounts on other popular online destinations, it’s not easy for people and other companies to learn about what you’re selling.
Fortunately, this problem is fairly easy to resolve. In most cases, you can get a complete website set up on your own for about $20. If you don’t want to build or design a website by yourself, certain companies have their own built-in website editors that are fairly easy to use.
You can also choose to hire help from a website design professional or company to get the help you need. This option will cost money, the exact cost of which can vary wildly. If you’re needing something fairly basic to start out with, you should be able to find a lot of affordable options.
6. Forgetting to Keep a Close Eye on Your Company’s Inventory
For wholesalers, there’s almost nothing more important than their inventories. Your company’s inventory contains all of the products you plan on selling. Unfortunately, some company owners don’t focus on the importance of proper inventory management.
If you’re not properly managing your company’s inventory, it can cause many major problems. Here are a few beneficial reasons why inventory management is so important.
Be There for Your Customers
One of the most important things to focus on is being there for your customers. As you’ve likely heard in one way or another: it takes a long time to gain a customer’s trust, but it takes far less time to lose their trust.
This saying means that customers understandably expect good service. If they don’t get it, they might not give your company another chance. It’s likely that you can remember a time when you expected a product, and it didn’t arrive in time. Whether it’s the fault of a company, its shipping partner, or another factor, it’s hard for a customer to not feel a little frustrated.
By properly managing your company’s inventory, you can catch product shortages right away. Because you’re not getting this information before it’s too late, you can order more electronics before there’s an issue.
Avoid Problematic Overstock Issues
Another potential problem electronics wholesalers deal with is being overstocked with items. While it’s not often quite as bad as running out of electronics, it’s not a good thing to deal with. Being overstocked can happen for a wide range of reasons.
Sometimes, the cause of overstocked inventory is due to misjudging customer demand for a certain item. In other cases, overstock-related issues are the result of a bad inventory management system or not having a system in place.
If you have free or inexpensive storage space, having a few overstocked items might not be much of a concern. However, this problem can become much more costly for wholesalers. Since wholesalers tend to work with large quantities of electronics, storage space is extremely important and valuable.
Wholesalers sometimes pay to have their inventory stored in warehouses. If they’re unable to pay for any more storage space, overstocked electronics that aren’t selling are major problems since they prevent the storage of more valuable electronics.
Eliminate Human Errors
If you’re trying to complete inventory-related tasks, you might be doing this by yourself. At first, it’s fairly simple to keep an accurate inventory of a few items. But what about when your company begins expanding? If you’re like most people, you’ll find it becomes much more difficult to manage your inventory as your list of items grows by the hundreds or thousands.
Whether you’re pressed for time or thinking about something else, it’s easy to accidentally get your inventory counts wrong when you’re doing it manually. For a simpler solution, think about buying inventory management software. With this type of software on your company’s side, you can eliminate the problems that human errors can cause.
Less Wasted Time
It’s also important to have a proper inventory management system in place to avoid wasting time. As a business owner, there are few things more costly than wasting a lot of time. With a way to better manage your inventory, you won’t have to spend your valuable time on inventory-related tasks.
7. Missing or Incomplete Business Listings
It’s easy to find just about anything by using the internet. With that in mind, many people use the internet to learn more about companies. When this happens, it’s essential to ensure that your company’s listings are updated with complete information.
If your potential customers see missing or incomplete directory listings, they might be hesitant to contact you. Instead of doing that, make sure your directory pages have:
Your company’s name
Contact information
Pictures of your business or inventory
A link to your company’s website
A description that lists details about your company
Having the previously mentioned types of information on your directory pages makes it easy for people to learn about your company. With a link to your website and contact information included in your listings, it’s also easy for any interested people or companies to contact your business.
When you’re creating pages on business directories like Google Business, Trade-In Tech, and others, make sure you list everything that your company’s potential customers would want to know.
8. Never Trying to Build Long-Term Relationships
Learning that your company made a new sale is understandably exciting. Unfortunately, this excitement can sometimes cloud the judgment of business owners. Instead of trying to build long-term relationships with these customers, some companies focus on targeting new customers to ensure this trend continues.
If you’re only targeting new customers, this can cause your company’s established customers to feel neglected. This situation can also make it seem like your business only wants a customer’s money, which isn’t something you want customers to think.
What’s about building long-term relationships is that a company has many ways to achieve this goal. Here are some of the most proven ways to achieve the goal of having long-term relationships.
Admit When Mistakes Happen
Many people find it difficult to admit when they’ve made a mistake. Admitting fault can feel even harder when you’re doing it on behalf of your company. While it might seem like a bad move, admitting mistakes is something that most customers will value. By doing this, it helps to humanize your company.
Reward Customers for Their Loyalty
Almost everyone likes getting recognized for what they do. For example, you might remember a time when you received positive recognition for something you did. With that in mind, one great way companies can give recognition to customers is through a loyalty program. This type of program typically rewards customers after they make a purchase from your business.
Send Them Valuable Information
Your company can also utilize one of the best ways to build long relationships with your customers by sending them valuable content. One of the best ways to achieve this goal is by creating an email list. With a list of email subscribers, your company’s updates go right into your subscriber’s inboxes.
If you want to take things the extra mile, you can begin grouping your company’s email subscriber list into segments. By doing this, your company is making sure to send targeted information to its audience.
9. Neglecting to Network With Other Companies
In almost every book about business, you’ll read about the importance of networking. Networking is a term that means to speak and build partnerships with other companies. It might not seem like this activity can do a lot for your business, but it truly can.
When you’re networking with other companies, you’re creating connections that could be extremely beneficial for your company. Even if it doesn’t bring immediate results, dedicating some time each week to networking can have positive implications for your business.
10. Trying to Do Everything By Yourself
Many people who are starting a business must work to get sales rolling in. While this is great, it can also be time-consuming and exhausting. Considering that, it’s a good idea to start thinking about hiring extra help and delegating or giving tasks to them.
It’s incredibly easy for business owners to get the help they need. With popular job websites like Indeed, Monster, and others, it’s easy for your company to create and post job openings. You can also check out popular freelancing websites like FlexJobs, Freeup, and Upwork to find help on a more temporary basis.
Yes, it does take some extra time and energy to find the help you need. However, growing your company by hiring more workers is a great way to help ensure your business is ready for whatever lies ahead.
11. Lacking a Business Plan
In life, it’s always good to have a plan. With that in mind, it’s also important to create a plan for your business. We understand that creating a business plan probably isn’t the most fun thing in the world. However, it can have major advantages for your company.
For one, having a business plan makes it incredibly easy to set attainable goals. You can then use these goals to set performance objectives. Having a business plan in place also allows you to better allocate money regarding your company’s budget.
12. Underpricing What You’re Selling
When you’re starting out a new business, it’s understandable to want to appeal to your customers in every way. With that said, one of these ways shouldn’t be something that causes you to lose money. Yet, one of the most common mistakes wholesalers make when starting out is to try and slash their prices too low.
There’s nothing wrong with having low prices. But, don’t think that having the lowest prices in the world is going to gain you a lot of customers. In fact, one study found that the opposite was true.
Research conducted by First Insight in 2018 reported that 53% of consumers rated quality as their most important factor when buying a product or service. Only 38% of those surveyed reported that price was their most important factor to consider.
Also, it’s easy to get hooked on lowering your prices. Sometimes, business owners feel that having the lowest prices is their only strength. Unfortunately, this can lead to their prices being so low that they’re soon forced to start cutting things like jobs and inventory. If this pattern continues, it could spell doom for a company.
13. Buying Only One Kind of Product
In the early stages of your business, it’s understandable to not go overboard when it comes to ordering items. If you have too many products in your inventory, it can cost your business a lot of money. However, as your business grows, it’s important to avoid buying just one type of product.
When you do this, you’re limiting the number of customers your business can appeal to. Instead, it’s a good idea to think about taking time to understand what products your customers want. If you own a company that sells smartphones, and a lot of people are asking you about tablets, it could be time to start stocking up on tablets.
14. Not Having an Email List
If you took a moment to check your email inboxes, you’re probably going to find a lot of marketing-related emails from companies. There’s a reason why so many companies utilize email marketing - because it’s effective. Research from McKinsey & Company found that, on average, email marketing is 40 times more effective than marketing a business by using social media.
One main reason why many companies neglect to start sending out emails is that it seems hard to understand. While this was definitely the case a decade ago, sending out emails is much easier than it used to be.
There are many popular email marketing services that can help walk your company through every step of the email marketing process. These services can also take care of sending emails and providing you with analytics about your email campaigns.
Unless you’re sending out tens of thousands of emails per month, you can get a basic plan from most email marketing services for about the same cost as a streaming service like Netflix or Hulu. Some companies like Mailchimp even offer free packages to companies with smaller lists of subscribers.
15. Not Working to Be an Authority in Your Field
With the internet becoming increasingly popular, one marketing strategy that many companies achieve growth by becoming authorities. Authority marketing is a cost-effective and proven way for companies (especially new ones) to gain a valuable leg up over their competitors.
One of the best ways to start becoming an authority is by answering questions. You might even have some questions from people on your company’s social media pages or contact forms from your website.
But, how can you increase your company’s authority if no one has any questions to ask your business? By finding people that need answers and answering them yourself. One great way to do this is by checking out a website called Quora. This is a website where people around the internet post questions about a wide range of topics.
Quora is far from the only “question and answer” website on the internet. However, it is one of the most popular. You might be surprised at how fast posting answers to a few questions can build up your business as an authority.
16. Thinking You’ll Become a Millionaire Overnight
It’s good to know that you can easily earn a nice living by working in the wholesale electronics industry. However, it’s also just as important to realize that you’re not going to get rich overnight. In almost every case, these kinds of promises concerning overnight riches are rarely true.
We don’t put this entry on our list to discourage you. Instead, we want you to enter the electronics industry with clear expectations. Fortunately, you’re taking steps to grow your business in a smart way by reading all of these tips.
If you’d like some additional inspiration, some of Trade-In Tech’s members have achieved massive amounts of success in the electronics industry. For example, here’s more information about how Novetta Wireless sells over 30,000 smartphones per month!
17. Never Harnessing the Power of Technology
If you’re not utilizing multiple forms of technology to help run your business, you might be unintentionally making things harder than they have to be. Fortunately, technology can make nearly every aspect of managing your business much easier than normal.
Technology can help you better market your company, make more sales, and achieve long-lasting relationships with your customers. Some programs even offer complete systems to align with the goals of your company.
18. Forgetting to Celebrate the Small Victories
While you might not get rich overnight, there will still be plenty of victories to celebrate as your company begins growing. When these events happen, make sure that you and your team celebrate them.
Taking care of business matters is a great feeling. However, your life can begin to feel like nothing but work if you don’t take a little time to acknowledge your company’s victories. If you keep up at this pace, running your business is always going to feel like hard work.
Don’t be afraid to take some time for yourself. Doing this allows you to relax and recharge, helping you to better prepare for the future.
19. Neglecting to Track Your Company’s Data
As your company continues, you’ll gain one of the most valuable things a business can have, and that’s data. With that said, some business owners are only focusing on sales without learning about the data that’s available. So, what kinds of data should you begin focusing on?
If you want to learn how your company’s website is performing, you can check out Google Search Console and Google Analytics. With these free tools, you can learn more about your website’s visitors, how long they’re staying on your website, what pages are the most popular, and where your company is showing up in search results.
Many social media websites like Facebook, YouTube, Instagram, and others have their own built-in analytics systems. By checking out these sections after signing into your social media accounts, you can learn more about how many followers you’re gaining each day, week, month, or year.
20. Not Using Social Media Enough
If you’re reading this, the chances are good that your company has at least one business-related social media page. Hopefully, your company has several social media accounts on all of the major platforms, including Facebook, LinkedIn, Twitter, Instagram, and others.
Regardless of how many social media accounts are in your company’s name, it’s important to think about whether you’re using them enough. Chances are, you’re probably not. Don’t worry - it’s easy to fix this problem. To do this, spend some time each week finding either helpful content from around the internet or your own company’s content that’s already been created.
Once you have a collection of links, start posting them once a day or every few days.
You can also use social media as a great way to start networking with other companies and your followers. With enough time and effort, your company’s social media pages can begin helping your business gain a lot of traction.
21. Being Afraid of Failing
Sometimes, it’s impossible to avoid failing. If you’re a new business owner, it’s important to be ready for times when your company misses the mark or doesn’t achieve its goals. Some people let this deject them to the point that they want to shut their companies down.
With that said, every business has to deal with failure and take a loss at some point. Instead of letting something like this get you down, use it as a lesson for what not to do in the future. You’ll soon find that your business can achieve a lot of growth in the future from a minor setback now.
In conclusion, there are many mistakes that electronics wholesalers can make. By checking out the previously mentioned tips, your business will have a major advantage over its competition because you’re not going to make these mistakes. If you’d like to learn more about managing and growing a successful wholesale business, make sure to visit Trade-In Tech’s blog. This blog contains a wide range of content for companies in the electronics industry.