Monday, November 30, 2009

Scalability from your tea suppliers

We see many specialty tea retailers offering wholesale programs. I think this can be particularly exciting, if you can identify a retailer who is importing their own, carefully selected teas. The buyer should know the teas intimately and if they are buying a garden that they have dealt with previously, they will also be aware of the seasonality and how comparable this season's crop is to last year's.

One of the challenging of getting started in wholesale as a supplier or establishing a relationship with a new tea suppler is scalability. As an importer, there is always the risk of buying at too high of a price or in too great a quantity. Alternatively, we experience regret when we find a great buy at a discount price and then can't supply enough product to meet demand. This latter case speaks to scalability and how flexible your current supplier is in handling orders across a broad range of buy sizes.

Take for example the Championship Teas at the World Tea Expo. Once we have an award winning tea or series of teas, the demand immediately escalates. Similarly, once an astute, large scale buyer finds a perceived undervalued tea, they may wish to buy out our entire lot with a single purchase order.

We constantly reassess our buying patterns to minimize in price and supply for our clients. Nevertheless, it should be noted that we are in a truly unique position of wholesaling and distributing conventional and organic tea products for a wide range of clients - everything from 2 lbs to thousands of pounds. Our buying is often made one to four months in advance of the receiving date.

I have a particular interest in business analytics. Certainly we have collected sufficient data on the above to begin modeling and managing inventory more efficiently. Perhaps this can be a good project for 2010.

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