How does an individual become an licensed dealer ?

CountryBoy · Jul 21, 2003

I recieved a magazine from NAEDA (North American Equipment Dealers Association) It is a buyers guide.My question is how does one become a dealer to purchase from some of these companies?I know you are saying why don't you ask NAEDA,but I like to ask the folks on this forum first, I am not talking about buying a tractor franchise,just being a legal name/business so you could sell a few things implements etc. for resale.They will not even talk unless you are a licensed dealer,everyone has to start somewhere. I have seen some dealers/places selling implements equipment and I know they do not have a fortune in there business,SOME of these places my house is worth more than there business.
I called a steel T-post manufacture the other day and asked him about buying T-posts and he said how many are we talking, I said what do you recommend,he said the best price would to be buy a tractor trailer load (5000 t-posts)I say price them, He does.I say is this your best price,he tells me yes.
Well I get off the phone and call a dealer that sells t-posts made buy this manufacturer and the dealer prices them to me a few cents cheaper than the manufacturer priced 5000, I call the manufacturer back and I tell him the price the dealer quoted me,he asks me the dealers name,it did not "ring a bell" he says maybe the dealer is in a cooperative,I said they get more of a discount than a guy buying 5000 posts?He said "oh yeah"
We chat a little and he says"Hey you learn buy asking"
I do not mean to sound naive about buisiness but I know there are a lot of knowledgeable experienced folks on this forum.

Thanks
countryboyiam2003@yahoo.com

DUMBDOG · Jul 21, 2003

The first thing you would need is a place of business in a area that is zoned for business. You would also need the appropriate license such as a sales tax license and any other permits required by your state and locality.

As far as the pricing goes, volume speaks, they will sell you a load at their load price, but they also have volume discounts which probably go up to so many loads per month or year. Just as the box stores can sell the same item so much less than your local store, it is because of lower margins and the better prices that they receive from the manufacturer.

Currmudgeon · Jul 22, 2003

You really need to ask them what they need to see from you. Since the law varies from county to county, and town to town, our advice will be kinda generic,

I had this problem with a material supplier. The town I lived in did not have a business license. The vendor accepted my State Sales Tax number. If your state doesn't have a sales tax, maybe you can get a Taxpayer ID number from the Infernal Revenue.

As far as discounts go, they vary by quantity. My father was a buyer for a large electrical contractor. They bought in multiple truckload lots. Our local discount house could sell some stuff cheaper than he could buy it wholesale.

CountryBoy · Jul 22, 2003

Thank you Dennis.

OkeeDon · Jul 22, 2003

What you need to legally say you are a dealer varies from place to place. What you need to convince a manufacturer or distributor that you are a dealer and entitled to dealer price is up to the seller. It runs from essentially no proof (other than you say you are), all the way to a personal visit to your showroom by a rep. In between are requirements for a sales tax license (most common, even when they don't need it for out-of-state sales; it acts as a sort of certificate of proof), letter head, fax number, references from other businesses, photos of a showroom, etc. Often there is a requirement to put certain items, or a certain number of items, on display, and they may require proof of display. Most larger suppliers will use a manufacturer's rep or salespeople, and these people make regular visits...and they expect to see a going business.

Most suppliers do not want to sell to individuals at dealer prices, primarily because it upsets their existing dealers, and rightfully so.

Libertine · Jul 22, 2003

CountryBoy:

Only being a little facetious, the minimum is a letterhead, some balls and cash in the bank.

It might help to have a corporate shell (with a fancy name) and a few permits (sales tax & etc).

Don't beg. You are giving them your money. If you can't sell the stuff you take the hit, not them. Make sure they supply YOU with references (I am only milding kidding)

Good luck to you. When you are your own boss, you never have to complain about who you work for. Seriously.

JEH