Buying Direct or from a Distributor: Striking the Perfect Balance
I mentioned earlier if you can make a purchase of some quantity that affords you an advantage on price, and you are confident that you will turn this product in a short period of time, then certainly you should take advantage of a direct-purchasing relationship.
There are any number of formulas that will allow you to determine the cost of goods based upon turn ratio and debt. However, I am a rather simple person who always believed in the premise that you should buy one, sell it, and then buy another. Well, that was until I began working for a manufacturer. Then I believed that you should buy 144 and sell them all before I came back for another order a month later. Either consult your psychologist or your accountant to determine which is best for your business.
As I alluded to earlier, beyond pricing, careful consideration also needs to be given to the salesperson that is calling on your account.