If you are sourcing computers for a retail store, you may want to investigate global computer manufacturers because of the lower cost of labor and materials compared to these costs in the United States. Computers have been around for over 35 years since first introduced in 1975. Worldwide PC shipments reached 82.9 million units in mid 2010, a 20.7 percent increase from the previous year, exceeding industry sales projections. Therefore, the future is bright for computer resellers, especially those who know how to source internationally.
Personal computers have always been in demand by individuals and businesses alike because the Internet provides information and instant communication, making many tasks more expedient while saving time and money. The Internet makes it convenient for individuals to learn, research, network, communicate, share information, entertain themselves and purchase products. It is indispensible for businesses, which can’t conduct commerce without it due to the speed of achieving business goals on the Internet.
This article provides tips for people who want to start a computer reseller business, as well as information on sourcing computers globally.
Starting a Computer Reseller Business. Those who want to start a new business can either use their own name or do business under an assumed or fictitious name. Registration of the latter type of name is known as a DBA, or “Doing Business As.” Depending on your location, this name registration can be obtained from a state agency or a city or county clerk’s office.
For corporations, LLCs, or limited partnerships, the business name can be registered when the articles of incorporation or statement of limited partnerships are returned to the state filing office. If operating under a fictitious DBA name, a fictitious name statement may be required by the state and/or county where the business is located.
If you’ll be hiring employees, you can visit the Internal Revenue Service website to apply for an Employer Identification Number (EIN). Information from the above documents may be needed when you complete a reseller application with a manufacturer.
You can either submit a reseller application to major electronics distributors who buy in large quantities directly from computer manufacturers and provide wholesale pricing to approved resellers, or you can apply directly to computer manufacturers. After verifying your business documents, some manufacturers will provide you with access to wholesale pricing, while others will direct you to their manufacturer’s representative.
Sourcing Computers Globally. Besides the big U.S. computer manufacturers such as Acer, Apple, Dell, HP and IBM, you can find computer manufacturers in Brazil, Russia, India, Japan and China, which are among the top computer markets. If you are going to buy from a foreign manufacturer, you might want to go through a manufacturer’s representative, which would save a lot of time and red tape because there are so many legal issues involved with importing including customs regulations, insurance, delivery terms and buyer/supplier freight responsibility, etc. These issues were discussed more fully in “The ABCs of Importing Goods into the U.S.”
For instance, you must protect yourself when it comes to product quality, delivery and payment terms. If you deal directly with the manufacturer yourself, you don’t want to make final payment until you have verified that you will receive on-time shipment of the correct items in specified quantities and of the quality standards required. This means you must inspect goods at the factory and provide a clear procedure for dealing with quality and delivery problems as they arise. You can’t depend on an OEM manufacturer to do this for you, but you can hire a local import agent to represent your interests on site.
We also want to caution you not enter into an OEM manufacturing transaction with only a purchase order. You need a comprehensive OEM Agreement with each manufacturer you contract with. The ideal OEM agreement will address all the issues of quality and delivery in addition to addressing other basic legal issues such as jurisdiction and dispute resolution. Your agreement should be written in both English and the language of the foreign manufacturer.
There is a lot to know in starting a computer reseller business and in sourcing from a foreign computer manufacturer. However, sourcing internationally and being circumspect in conducting business to protect your interests will help you succeed. Sourcing platforms like TopTenWholesale and Manufacturer.com list many SupplierPass™ manufacturers that have been pre-certified as authentic companies by a third-party agency. In view of the recent problems with fraud on Alibaba, it would be prudent to check out these suppliers when sourcing.