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Thread: Buying group

  1. #1
    Bad address email on file abocandy's Avatar
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    Buying group

    Hey guys,
    I have been in business (almost) a year now, :)
    I have not had a buying group yet, SHould I??
    Please give me your input on pros and cons.

    Thanks
    Candy:p

  2. #2
    Master OptiBoarder
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    That depends. What lines do you sell? Top 5 frame companies? Smaller co's that give big discounts on direct billing?

  3. #3
    Bad address email on file abocandy's Avatar
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    Top 5 companies

    Tura
    Luxottica (for now)
    Kenmark
    Aspex
    Maui Jim

  4. #4
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    You probably don't need a buying group, but I would get one anyhow. Reason: Those times you need to order a safilo, viva, etc. frame that you maybe don't carry, but have an account, you will get a better price. I don't carry tura, aspex, maui, but if your volumn is good, you should be able to get a good discount direct. Kenmark bills direct with good discounts, even lux will for the right $$ per month.

    Remember, buying groups only take a part of the offered discount. So, having one doesn't hurt.
    Also helps in opening new accounts that you know will be small volumn, less paperwork.
    JMHO

  5. #5
    Master OptiBoarder OptiBoard Silver Supporter Jubilee's Avatar
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    It depends on your volume and why you want a buying group..

    If you are just looking for a discount, most of those manufacturers are willing to give you a good discount if you do a decent amount of volume with them. I can get as good as a discount direct for most of my lines and in some cases more, than I get from the buying group.

    Buying groups do offer consolidated billing and some will even get you discounts on lab and contact lens services. Once again though on contacts if you have a "favorite" brand, you may get as good or better of a deal through the company direct.

    The reason is buying groups have to cover their costs and make money somehow. They do this in different ways. The most common is a percentage admin fee dependent on the amount of business you do along with or instead of a lower discount rate. IE if Kenmark offered the buying group a 20% discount, the buying group may tell you that through them they can offer an 18% discount on the product. So they make money on the 2% they don't pass on to you..

    And/or you may pay a 4% admin fee for the $2k in business you did with them this month...

    For some people that spread their business about or aren't high volume, they are still saving money.. for others it can be a wash, or maybe even more $$. However the convenience of having a single statement for the majority of your goods is worth the price to them. Less time spent paying bills, and more time making money...

    So my suggestion is to decide what you want the buying group to do, then shop around to see if any fit the bill. You may talk to ADO who is in the buying group business...
    Last edited by Jubilee; 12-27-2007 at 05:06 PM. Reason: clarification
    "Some believe in destiny, and some believe in fate. But I believe that happiness is something we create."-Something More by Sugarland

  6. #6
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    It's simple. You call the buying groups and have them fax over their list of vendors and the discounts that you would recieve. This you compare to the prices you are now getting. After factoring in the fees for the buying groups if any, you should get a clear picture of the money you would save. You can pick and choose which accounts to switch to the buying group and which to keep as direct bill and pay. We use the Alliance.

  7. #7
    Master OptiBoarder
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    Yes, you need a buying group. It's like having instant credit with all the vendors that deal with that buying group. Saves time and paperwork filling out credit apps.

    You can still decide if it's better to bill through the buying group or direct.

    Also, on a small number of occasions, our buying group has used their influence to straighten out billing "issues". Kinda like your credit card company. They will work for you as an arbitrator.

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