Getting business from an existing business

[wutangnomo]

Hello all. Here's my question. Lets say you had a business, doesn't matter what type. It can be a lemonade stand, a retail clothing store, a law firm, a storage warehouse, a big wig corporation, etc etc. The point is that you are the business owner.

If someone were to "come off the street" or call you up one day and say, "Hey I can do this for you at a cheaper cost" would you consider it or even take it seriously?

 

[bran987]

price sensitivity is different in all industries! but that is the basis for many ad campaigns. just look at the battle betweeen satellite & cable TV
satellite has commercials calling cable TV 'pigs' saying satellite is so much cheaper.

if you can prove equal or superior quality & service at a reduced cost you've got a fighting chance

Also it's like ancillary guys for instance they sell finasteride 150 doses for $50 but they are a guy off the street who I never heard of before 1 month ago, can I trust them over Merck just because they are cheaper? whereas big cable tv & satellite are both established and well known so the quality issue doesn't become as big of a deal.

it's situation dependent

 

[wutangnomo]

Yes you're right, it is situation dependent.

Ok lets say the business is a smaller private business, not some big wig corporation. It can be a little retail store, a little family doctor practice, a privately owned gym, or something like that. Basically the business is SMALLER therefore price sensitivity is more of an issue to the small business owner. Would you be more inclined to listen should someone "come off the street" and PROFESSIONALLY make you a proposal?

My situation is as follows. I am able to get protein powder at a VERY cheap cost at wholesale basically. The protein I can get is high quality isolate (I can also get concentrate and other types of protein and products as well). This company produces raw nutritional ingredients used in many health and supplement and feed products (sports drinks, pharmaceutical and supplemental health products, cooking products, baby products, etc).

Since we're on a fitness site and I'm into fitness, I thought it would be nice to dabble in the fitness industry somehow. I can get 20 kg bags of high quality isolate at substantially reduced costs. If I were to sell to the gyms (lets say my gym) and they were to sell ONE scoop at $1.50 each (one scoop yields 26g protein) they would make around $1000 off this one bag. If they were able to sell ONE scoop to 20 people every day (which my gym can b/c it has an extremely high volume and an active juice bar), they would get through that protein bag in about a month. My gym is so high-volume that they can probably sell one scoop to 20 people from 4pm to 7pm alone.

Actually what I would suggest is that they sell ONE scoop (which is a 30g scoop) for $1.75 and TWO scoops for $3.00 that way to entice people to go for two scoops as opposed to one.

I should also note that my gym sells Myoplex for $5 EACH!! And they go through Myoplex boxes very very quickly.

Any thoughts?