business question - mail order type - need opinions

[rentprop1]

guys, I have a buddy that had an interest in starting a mail order type adventure, however I wondered if there was a way to try it with out starting an entire business and later find out it dosent work / or fail.... here go's

lets put in in boating launguage : this is just an example !

lets say I can sign up as a prop dealer and get 4 props for $ 1700, at that price its almost like getting one free...If I wanted/needed a prop and a buddy needed a prop and I could peddle/sell the other 2 over the net, and they sold like hotcakes...lol ....would it be in best interest to try something like that and continue to use my dealer status to purchase props at a lower cost and just sell them like craigslist/e-bay to make a small profit ?? and not really try and compete unless it really took off, like obtaining master dealer status and a lower dealer cost ??

would I need a tax ID number and do all the required bus license paperwork to get started or could I get set up and sell a few and see how it goes ??

any ideas, thoughts or input.

 

[BlazinKuztumz]

Re: business question - mail order type - need opinions

I run my own business, and deal with drop shippers, and places that will allow me to do either a small buy-in (less than $100), or will allow me to sell up to higher levels of price cuts. Not sure what county Inverness is in off the top of my head, but here in Hillsborough, you just have to get a business tax license for $30, and you are good to sell. You also have to set up with the state to receive a resale tax certificate, saying that you are reselling items, what items/services, and that you will charge tax and are liable to pay said tax. That set up is free, just have to follow through with the paperwork. Then if you don't use your name in the business name, you'll want to hit up sunbiz.org and pay the $50 (for 5 years I believe it is) for a fictitious name filing. Last but not least, if you don't want to have to use your SS # for filing taxes (for income purposes) or to be given out to suppliers, then you want to get up with the IRS and file for an FEIN (federal employer identification number) which is also free to do. So, like for me, it's $30/year, $50 every 5 years, and I'm good to go. Now, as far as advertising, where you sell, etc. that one is solely up to you. If you aren't investing in too much stock, or investment into the business, you can do like I do and enjoy running it, making sales when/where you can, and the spiffs of having said licensing when it comes to getting some of your own parts here and there. Good luck.

 

[rentprop1]

Re: business question - mail order type - need opinions

Blazin, thanks for the tips

if I only got the dealer set up and bought the one ( 4 prop ) package ( remember this is just an example ), then later sold 2 of the props and did not sell anymore, couldn't I just report profit on the other 2 props and be done with it ??

 

[BlazinKuztumz]

Re: business question - mail order type - need opinions

You would report just the two props as a profit (gain) and if you sell them to anyone in FL, you'll have to also report the applicable taxes (both state and discretionary for that county). The two props you keep, you'll still have to pay a use tax on though. Most items bought for business use, you don't have to pay sales tax on, but are required to file a use tax (they get you one way or another). The nice part at that point usually is the fact that you got the product cheaper because of your business license. But, in order to get the dealer set up, most companies will require you fax over proof of business, which will usually consist of a license/tax receipt of some sort, and a resale certificate. Hope that helps.