Congress Overtime Rule Would Crush Small Businesses

wholesale merchandise - overtimeThe Labor Department’s proposal to expand overtime would suffocate employee development and company growth, a small gift shop owner from Alabama testified recently at the hearing. Many wholesale merchandise suppliers and independent retail stores are up in arms over this new proposal.

 

Having a blanket overtime rule ignores the fact that the cost of living from city-to-city varies greatly. He pointed out the major differences from his small Alabama city to New York City. Such a dramatic one-size-fits-all increase will have big consequences for workers as well as small businesses. Every dollar spent on compliance of this regulation would have been one that could be used to grow businesses and invest further in employees.

 

The National Retail Federation has found that the more than doubling of the overtime salary threshold will force many employers to convert their salaried managers to hourly,. non-exempt status, and their managers would oppose the rule because overtime expansion would limit their opportunities for career advancement. It would also have a disproportionate impact in rural, low-wage areas.

 

Converting salaried positions to an hourly wage adds pressure to get the job done in a standard 4-hour work week. Most employers will not keep the workers past the 40-hours because of the exorbitant costs and this will hurt everyone.

 

This new overtime rule is bad for employees as well as business owners, it was argued to the Labor Department and small business owners around the country need to speak up against it.

 

The trend that we here at Forum have seen is that many employers are cutting their workers hours. With the mandatory health care inclusion now set at 30 hours, we have heard from many workers complaining their hours now are averaging under 30 hours weekly so employers do not have to put them on their health care coverage. How is anyone supposed to make a fair living and support themselves or their families on part time work. Our country has become one of part-timers and “gig” workers. When all the politicians talk of job creation it would be nice to know if they are meaning full time, full employed workers like our parents enjoyed during their careers.

 

What do you think?  Share your comments with us.

 

 

 

Wholesale Merchandise Industry Suppliers Still Viable

wholesale merchandiseWholesalers of merchandise have had quite a run on things over the last few years with many retailers thinking they could bypass them by going online and trying to find the direct manufacturers of merchandise. What retailers found is that the internet is a maze of confusion and there are many unscrupulous dealers who have no connections to merchandise.

 

That said, retailers around the country have realized that wholesalers play a valuable part in the success of their businesses. A good wholesaler knows what products are trending and has the resources to buy in large quantities to keep merchandise costs competitive. Established wholesalers have the connections to the major brands and are allowed to purchase them for resale. Many novices find out quickly that the major brands are not interested in selling to small independent retailers.

 

I think one of the most challenging things for retailers this year was that many tried to buy directly from overseas suppliers to save money. Buying overseas requires a skill level that most of us do not have. There is a lot of quality control issues as well as payment terms and shipping that are best left to the professionals. How many of you have tried buying overseas only to be frustrated when the merchandise arrives broken or misrepresented? Unlike a local supplier, it is often difficult and expensive to try to remedy overseas purchases gone bad.

 

This is where the established wholesaler comes in. They negotiate regularly with overseas suppliers and take on all the risk. Before it gets sold to you, defective items and problem wholesale merchandise is removed so you get only the top quality in the lot. This is why importers are entitled to their small percentage of markup when they resell goods. It is a small price for retailers to pay to have someone ensuring the quality of their purchases.

 

What has been your experience with wholesalers? Share with us…

 

 

 

Manufacturing In America?

wholesale merchandise, manufacturingThis month just some fodder to think about. Since the election of our president (twice!) there was a good deal of talk about bringing manufacturing back to the United States. The idea is great and it stirs up a lot of cheers from the crowd. But the reality of doing this really is quite different that the concept.

 

If you are talking about very high end goods like cars, then yes, manufacturing can be done in the USA. The product has enough margin to sustain localized manufacturing. How many people do you know who build cars? The talk was about all types of manufacturing to get our factories buzzing again. That is a much harder scenario.

 

When it comes to wholesale merchandise, do we really think that we will be able to manufacture here as opposed to overseas? The conundrum is that dollar store merchandise made here in the USA would be considered $5 store. Because citizens of the USA are trained on bargains and deals, it’s very unlikely that they will pay double or triple for a product because it is USA-made. The concept of USA-made gets a lot of cheers until consumers need to open their wallets to pay for it.

 

The other end of that is the manufacturing itself. How many people do you know will want to work on a factory assembly line making minimum wage to assemble widgets? Even if a factory could employ American workers for minimum wage, that is still double, triple or beyond what they pay their counterparts in other countries.

 

So, we have a double edge problem. We really should manufacture here but we really can’t afford to either make it, or buy it after it’s made. And unless the product is a high margin one, companies will not consider cutting into their own margins.

 

By the way, and I never understand why the millennials never take offense to Apple when they are “Occupying Wall Street.” Here is a company that employees poorly paid workers in China – exploits them and charges $600 for a cell phone here in the USA. This is a great example where we CAN manufacture here in the USA and maybe instead of costing $5 to make an iPhone it would take $10 – still leaving a big margin and allowing American workers the opportunity of employment.

 

I often think of the Apple scenario and wonder why our President hasn’t reached out to the mega tech gurus over there … then I realized that he’s a Blackberry guy! And we all know what’s happened to Blackberry!

 

Your thoughts?  Please share.

 

 

 

Economic Woes Continue – Antacid Sales Skyrocket!

wholesale merchandiseWell, there is no doubt that the recent economic woes caused by the Government shut down and idiocy on  Capital Hill have created anxiety for small retailers and wholesale merchandise suppliers, I found the following interesting news worth sharing with you.

 

The latest issue of MMR ran a large article on drugs and vitamins and their increases in the industry. Lo and behold one of the largest growth markets has been the Antacid market which has grown to over $93 million in sales with some brands showing as much as a 74% increase in growth!

 

Could this be related to the economy? Like a bad sit-com where the boss is swigging Pepto at his desk, there could certainly be a correlation to these numbers and reality. Let’s look further – the personal adult market has decreased over 6% but sleeping aids are up over 28%. Do the math. The country’s population is suffering from indigestion, having less sexual activity and having trouble sleeping!

 

Thank you, Mr. President and all our favorite Congresspeople. The takeaway from this article is that your store should be stocking up on Tums and Gas X to keep your cash registers ringing.

 

Just some things to consider from the leading magazine for wholesale merchandise, Retailers Forum. Thanks for reading and hopefully you’ve enjoyed this little insight.

 

 

NYC Wholesale Expo – 2 Day Format

NYC-Wholesale-Expo-Sept-2013-0101Just back from the NY Wholesale Expo at the Javits Convention Center in New York City. Having done wholesale merchandise shows in New York I realize the need for this wonderful regional show to connect wholesalers and east coast buyers and couldn’t be happier that the New York show tradition continues.

 

Over the last several years there has been a lot of changes in the merchandise shows around the country. There is a resurgence of regional shows that are doing very well across the country and while the shows bring in less traffic than the mega-shows in Las Vegas, they are quite important to the local regional markets.

 

NYC Wholesale Expo Sept 2013 002One of the major changes for the NY Wholesale Expo was the creation of a 2-day trade show instead of the standard 3-4 days. This is unique and I have not seen this done before, so asked several of the wholesalers at the show how they felt about it. The response was overwhelming that as long as they got orders from the show, they were ecstatic about being able to compress 3-4 days into 2. And from what I was able to view at my day at the show, there was excellent order writing so I think most exhibitors were happy about the shortened show time.

 

Personally, on smaller regional shows, this new format is ideal for both the buyers and sellers. Having two days to explore the smaller show leaves plenty of time to view all of the merchandise as well as interact with the exhibitors. Being someone that drives in and uses the local lot for $50 a day, cutting a couple of days off the show can save money also!

 

Congratulations to the NYC Wholesale Expo for pioneering a new concept in shorter, more intense trade shows and for continuing to develop the New York City market, which we feel is one of the most viable in the USA!

 

What did you think about the show, or the new 2-day schedule. Blog with us!

 

 

How Is Your Store Doing?

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wholesale merchandise shoppingWell, we are getting set for the last quarter and that is the time that all retailers look forward to, as they do a bulk of their business at this time. The reports in the news and trades show that the economy has improved somewhat and that consumers have been going through spending spurts.

 

The holiday season has always been successful for retailers, regardless of the economic climate. While the large mega-stores get upset by not posting gains, the small independent retailer is happy to clear their shelves and move inventory for the last quarter. All that the retailer wants to see is profits at the end of the year and this is the time that with proper marketing and merchandising he will be able to see that!

 

Your merchandise mix is extremely important to your sales success. Having the right blend of merchandise at the right prices is going to dictate how you do this season. Many retailers have been using our wholesale merchandise magazine, Retailers Forum, to find merchandise, as well as visiting all the popular trade shows.

 

Now is the time of the year to start your holiday marketing programs and promotions. The more you promote your store the more sales you will have. Make sure you take full advantage of the inexpensive social marketing that you can be doing for your business. This is a good time to update your customers mailing list info, email addresses, twitter accounts or whatever to get the word out…. We’re here and ready for business!

 

 

New Small Business Regulatory Website

small wholesale merchandise businessesHouse Small Business Committee Chairman Sam Graves (R-MO) today announced “Small Biz Reg Watch”, a new initiative of the Committee to help small businesses participate in the development of federal regulations.  An online resource on the Committee’s website will highlight proposed regulations that could impact small companies and instruct business owners on how they can make comments to the federal agency considering the proposed regulation. 

 

“Most small businesses don’t have lawyers or lobbyists who focus on regulatory compliance, like larger corporations may have,” said Chairman Graves. “Therefore, our Committee wants to help them participate in the federal government rule-making process. Not all regulations are bad, but many can be unnecessarily burdensome and it is important that small companies express their concerns before a rule is finalized. Because small businesses bear a regulatory cost that is much higher than the cost of compliance for large businesses, our Committee wants to help small companies make their voice heard as federal regulations are being considered.” 

 

“Yesterday, we saw our economy contract and produce its worst quarter in 4 years. Exports are falling and small businesses are sputtering under harmful government regulations. It’s important that we communicate to Washington and its regulators that there are real negative impacts and consequences to over-regulating,” said Rep. David Schweikert (R-AZ), Chairman of the Small Business Subcommittee on Investigations, Oversight and Regulations. “This new initiative will keep small businesses current with the goings on in the regulatory community and ensure they have the opportunity to contribute as new regulations are being formulated and applied.”

 

The Committee will regularly communicate with small businesses via email, social media, and through district events around America when new comment periods begin for select proposed rules that impact a wide array of small businesses.  Since becoming the lead Republican on the Small Business Committee, Chairman Graves has built a large database of small businesses with which he communicates regularly.

 

The website URL: www.smallbusiness.house.gov/RegWatch

Retailers Forum magazine, leader in wholesale merchandise is happy to share this exciting and helpful website to you!

 

 

Back to School Will Have Late Start

The back-to-school shopping season is a boom to most retailers and while the numbers for 2012 are looking promising, they are much more sluggish than last year. The simple reason is that the season will start later as many students and their parents are delaying their purchases until after school actually starts.

 

With trends and styles changing weekly, shoppers want to buy the right items and thus are waiting for the school bell to ring so that the students can see what is popular amongst their fellow students. Of course, if you think about it, it makes no sense because if everyone’s waiting then they are all starting school with outdated styles! But, in the world of retailing not everything seems to make sense. This is bad news for the economy as the late start is not good and merchandise sitting on the retailers shelves waiting for the shoppers is never a good thing.

 

Large chains such as Wal-Mart and Office Depot have seen their customers playing the waiting game and buying only things that are necessary for the initial start of school. They also feel that the shoppers are waiting for the deals.

 

The consequences will be dire if the sales do not rebound. This selling season is the second largest period. By late August it is estimated that only 8 percent of shoppers with school age children had completed their back to school shopping, the lowest figure in the last several years.

 

Some stores like A&F overdid things by bringing in winter gear way too early and have performed poorly for this season. Heavy winter jackets and sweaters when it’s 95 degrees outside may not have been the smart move for the chain.

 

Many older students will be waiting until after Labor Day so that they can assess what their friends are wearing as well as what their favorite stores will be showing for the new season.

 

Retailers Forum Magazine keeps its readers on the cutting edge with business information and wholesale merchandise sources updated daily.

Here’s What Grinds My Gears…

The news for the retail industry has been discouraging since prior to last Christmas season. We read now that many established stores will be closing down this year. I read that it is estimated that over 40,000 retail stores will close this year. Now, some of them deserve to close as they were mismanaged and honestly I never understood how they even stayed around in the first place.

 

Also, remember when you read the doom and gloom news that stores like Steve & Barry’s and Mervyn’s have closed down through bankruptcy that perhaps this was a pre-meditated move. I recently read an article about the founder of Mervyn’s who sold the chain to an investment group thinking that they would carry on the name and promote the business. The article showed that the investors seemed more interested in the sum of its parts (real estate, real estate, real estate!) Same with Steve & Barry’s? Also saw National Wholesale Liquidators decided to liquidate themselves stating the tough economy hurt them. Hurt them? They sell CLOSEOUTS for goodness sake. The dollar and discounters are doing great when times get tough. Instead, I think they found a way out of their unsuccessful locations and a way to STIFF their suppliers. It was really interesting how some of the family members of the chain BOUGHT BACK their own stores in the bankruptcy auctions! They cherry-picked the profitable locations and cleared the liabilities to get a fresh start.

 

As a small business we’re not going to get the investor speculators to throw money at us. If we independents don’t step up and work harder and smarter we only end up going out of business. No fanfare. No front page in the Times or on Bloomberg’s news site. We simply have a clearance liquidation sale where people in the community who never bothered to stop into the store come in and feign sympathy as they buy for 75% off the dollar. My favorite line at these closing sales are “Oh, what a great store, it’s too bad.” This, coming from people who never bothered to stop in. And another local small store hits the dust. More community blight as downtown areas turn to ghost towns and property values dwindle down.

 

The small business is the backbone of our country and our economy. I can only hope that the new administration realizes this and steps up to assist our struggling businesses by emphasizing the need for communities to embrace their small businesses. These are your neighbors, sharing their love and concern for your community. The big box stores don’t care – they will take your money and put NOTHING back, sending their profits to their headquarters eons away from your hometown.

 

As small businesses we need to PROMOTE LOCAL SHOPPING with signs like “Support Your Local Merchants” and programs to encourage shoppers to stay local. We’re all in this together, as neighbors.

 

Well, that’s what Grinding My Gears this week!

 

 

VIRTUAL SPENDING… WHAT IS THIS WORLD COMING TO?

The economy is starting to chug along again, although lately the stock market has had such big ups and downs. Many fellow retailers have been having a hard time selling merchandise at their stores and are looking forward to a better year mid-year 2010. When I say retailers I mean real stores with real merchandise that buyers can touch and feel.

 

WHY do I expound on “real” merchandise you ask? Well, let me share this with you and maybe you’ll be as crazed as I was after I heard this…

 

Social games have become a new trend on the internet. This new industry is sucking in staggering amounts of money. In one recent 30-day span, Playfish, a creator of social games sold for $400 million. Playdom, another game company raised $43 million in financing, while another, Zynga raised $180 million. Many are equating this trend to something larger than the dot com trend back in the 90’s.

 

Companies like Playfish can develop a game for under $100,000 and complete it in just a few weeks. These virtual games don’t even have to fight for shelf space. What makes me insane is where the bulk of the social-gaming revenue comes from: the sale of virtual goods. The virtual goods are digital stuff that doesn’t actually exist.

 

While the games are free, users have countless opportunities to buy stuff: Playfish says it sells 60 million items a day, from $14 engagement rings to bacon sandwiches that cost a few cents. The goodies make it easier to advance in the game.

 

Imagine that…people are shopping and they are spending… ON MAKE-BELIEVE MERCHANDISE! How sad is that? Well, sad to the tune of $75 million in sales for 2009 that could double this year! For fake bacon sandwiches and engagement rings for a game!!

 

Is it just me? Have I gone insane? How tempting would it be for us retailers to post signs in our stores offering “virtual” jewelry — just $29.95 for a pretend ring! And here we have these venture capitalists chasing these gaming companies to throw money into them. Then you have the players willing to spend real dollars for birthday parties for a digital pussycat! Can you say $75 million? I think we’re in the wrong business!

 

Have you heard of this? Are you a gamer? A retailer? Blog with me and let me know what you think.