anyone doing business with costco??

randa

We just got a call from a buyer at Costco with interest in our product!!!  Can anyone give me some advice on doing business with the big boys??
What markup do they ask for?
what terms do they pay on?
Anything else important??

nevadascul

First, are you going to be selling your product through any other outlet, or directly to the customer
( retail).  Second, what is your base price.  Somewhere between your base price and retail you will assign a price to sell to Costco.  You might also want to consider a tiered pricing structure for Costco.  You also need to find out if Costco has a prise they are looking to sell your product at through their stores.

MichaelB

Costco is a great company.  You will need to make sure you have the ability to manage your inventory as Costco buys on multiple levels so you will need to forecast accordingly.  Most of the time you are dealing with an in and out item.  You need to have your margins set.  I obviously do not know your wholesale selling price but the markup from Costco`s standpoint is based on an equation which is primarily based cost and what the buyer feels the product will move at.  Usually you can bet safe that there will be a markup of at least a 65 - 75 up again, depending on what the product is.  Costco pays pretty well at around net 35 - 45 days which is usual in this business.  If they are bringing the product in as a 30 day test then they will most likely pay net 65 on the test and if the pull through numbers come in apprppriately they will bring it in slowly as an in and out item and pay net 45.