Re: A Question On Exporting

In a message dated 1/14/02 9:37:41 PM, writes:

First, if you can, turn off html when emailing me, I never turn it on so your
emails are hard to decipher. Answers follow...

However lets say you are contacted or catch wind of a goose and turkey egg
farmer in lets say China.

***Has poultry farming long been a passion of yours? Or have you longed to
learn fowl ranching?***

He is farm is rather small but due to demand and his success in the past
three years he has the capital to increase his production rate by buying more
hatchlings. He is prepared to pay.04 USD to .05 USD an egg.

***So he should review Chinese import records to find the best place in the
world to buy eggs, and then follow up with the best supplier in that
determined country.***

And wants an initial purchase of 5000 to 8000 hatchlings from a US source.

***So his maximum order would be $500.00 us dollars (8000 nickels). You'd
have to get these for at most 2.5 cents each. I just got a buy-one get
-one-free deal at safeway which yielded 36 eggs for the price of 18. Lemme
see, that was about 5.25 cents an egg, for chicken eggs, and very poor
quality ones at that. You'd have to have a profound passion for this work,
and a government's ability to fund lost causes.***

How would an exporter research a source?

***I am sure, with a passion, one would find the egg ranchers association,
the poultry husband association, and no doubt the organic farmers as well and
learn all one could learn. A google search online would give one plenty of
leads. ***

Once he has found several sources and found the best quality for his customer
should he buy wholesale and resell to the farmer?

***One would have to search the world over to answer this question; that
might take years.***

If he does not have the capital or know any willing investors, could he work
as an agent? How do agents set up a contract and fees? What are the usual
cuts? That probably depends on what is being sold and how much of the
paperwork and logistics the agent does for the seller. Am I on the right
track?

***No. ***

This is all assuming the buyer is reliable and honest.

***Sadly, this has become subjective.. we now only determine if the deal
makes sense. Forget reliable and honest. Everyone is, until they burn you.
Then they are not. If the deal makes sense, burning you is pointless***

Out of curiosity can agents make residual income. For example an agent makes
a deal. He matches a buyer and a seller. The terms of the contract state
that the agent will receive 5% for the deal and 5% of every other deal which
is through the same buyer. Does this ever happen?

***Certainly, but money for nothing doesn't last long. Either the fool that
agreed finds his costs are too high to compete against others and goes out of
business... or being a fool his biz never gets going.***

The buyer and the seller would have know of each other if it was for the
agent. And if they had a long term relationship wouldn't the seller be
grateful enough to consider such terms considering the company would not have
been making this extra cash flow if it was not for the agent.

***Right***

I think the disadvantages of working as an agent is one: As a whole
mostly one time sales. Therefor the agent must work like a real estate agent
finding multiple sellers. Plus he/she only gets a small chunk of the profit.


***Even real estate agents will tell you they'd starve without repeat biz and
referrals.***

The wholesaler makes a greater profit.

***and has greater risks***

And if you are the manufacturer selling directly to the buyer, I think
you would make that much more.

***and have even more risk.***

Please correct me if I am wrong. I am trying to learn as much about
business as I can. I thank you for your time and having to view my naive
ideas is probably frustrating for you. Thanks again

***O contraire! it's fun. Start with something you love. The rest falls in
place.***

John

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