CO-OP being contemplated

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One scenario

I can see that you will have a nice inventory on hand. Kits, bits blanks etc sitting in a few boxes in your house or garage and everything has it's price.

Well someone says I can get these same items at an even lower price by starting up a group buy. He starts a thread advertising his buy and everyone jumps in because the group buy prices are lower than the co ops prices. He purchases his products and distributes them the same as always in two or three weeks and everyone is happy because they bought their supplies and saved a good bit of money. The items purchased to start the co op is still sitting there in boxes with no one interested in purchasing them because the group buy items were cheaper than the co op items.
 
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The truth is comments like the coop taking over or puching out group buys are simply ignored by me. It only shows me you are not willing to give this enough time and thought to even understand what I am talking about.
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Perhaps, if you attempted to tell us what exactly you are talking about, then perhaps you might find people better understanding you. However, even though you see it you choose to ignore what the majority of people want. . . .

That most simply want the savings with outgiving anything for it. ory but htose opinioins simply do not carry much qulification for me.
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DUH!! No wonder people do not listen to you. You are trying to get us to take a hold of something we do not want. Plain and simple. And your attitude of our opinions, because they do not line up with yours, does nothing more than turn people away. I don't think it can get much clearer than what the majority has already made clear. They do not want a CO-OP.
 
Here is my opinion on this. i am asking the group to do there part in making these big China deals more managble for me. Period.
that part is accepting that I will double the cost of the products in order to buy additional products. this way I do not have to do the group buy thing and can still provide products at really low prices 50-90% savings.

in trying to figure out how to do this I run into several conflicts.
the first is that a group buy cannot charge a mark up of any kind for any reason.
My idea still needs to be ran like a bulk buy (money being sent up front) in order to get off the ground. after the first buy it would be ran more like a business looks with the buying and selling going on behind the scenes not in a thread like group buys do.

well both of those factors bring up the questioin of how does anyone but me really know what is going on with all that money. so new problems.

so fine I do all this to do a one shot you are either here or not to get in on it bulk buy (which I am really getting tired of telling people after the fact sorry).

Of course there are new problems with this bulk buy thing. anouther one will not be done until there are enough orders to meet the min order from the supplier. in this case 100 sets of bits or 300-500 individual bits. even if the 500 individual bit requirment was met the shipping on those bits will destroy the savings on them. so the order really needs to be the size to weigh 100 to 120 lbs. that is a huge number of drill bits (and orders to process). this demand may not accure for anouther year or more. in the mean time every penturners is still rellying on the old broken methods of getting drill bits, complaining about the cost of having to get this bit or that and once in a great while someone mentions this group buy that was done once. maybe anouther one needs to be done.

I really doubt that anyone has thought of this. How many new turners are there right now on this group that even need a brand new full set of bits? How many of you need one at any price? I think that most of you have already figured out how to get the ones you need and if i started right now and sold full sets to only new turners for the next three months I might be lucky and get 100 sets sold. and a year from now when it is time to do anouther regular bulk buy I would still be faced with the same handicap. i like the idea of being able to offer every new turner that comes into this group a full set of bits as they come in.

as far as I know you can't compare what i am offering in this one buy to anything because you can't find it anywhere else.

OK so fine the group does not like there being a profit. So i accept that all my effort will only result in so much and do a one time group buy anyway. now I have to solicite at least 100 orders for full sets in a one time stretch which results in weeks of effort and managment rather than a few minutes here and a few minutes there. it also requires that when the bits arrive, my house is overran with the affort to sort inventory, pick orders, package, and mail them. this does not take a couple of hours, at best it takes a couple of days. my effort to do a group buy has evolved from a few minutes each night or a couple of hours in the evening to mail orders. to money out of my pocket, weeks of organizing, and days of shipping packages. But the group does not want anything to change. i want to do group buys, but not bad enough to keep doing them they way they are going. My wife and family alone will not put up with it. The last group buy I did my wife flat out said, if this is the way it is going to be you need to be making money from it, period. and she is serious as a heart attack about it. she will not let the group buys effect the household and the family the way they do without there being some benefit for it.

for me it is either make changes that work better or give up the chance at these deals.
So anyone have a better idea than a CO-OP?

So everyone knows just what sort of deal I am talking about when it comes to drill bits. a full set of TiN bits (35 bits) for $77.00 to your door. that is barely over $2.00 a bit and includes all the over half inch bits. a 14mm TI bit from MSC alone costs $105.00. Just one bit out of the set costs more than the entire set. I cannot find complete set of Ti bits anywhere for any price. MSC doesn't list Ti bits over 1/2 inch in there catalog. to get just HSS bits in all these sizes would cost about $250.00.

My wife has agreed to this buy as a compromise to the problems we have here with them. it will mean a one last ime processing 50 orders, which she is not happy about, but will then be a day to day effort that will not disrupt the entire house.

There is no question that my efforts to offer this group better prices on products will change, it will change to work better for me and my family or it will end, either way is a change. I would rather it did not end.
 
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Daniel
Your idea is interesting, but I think it would more complicated than it is worth. The way I understand your proposal, is that multiple members of the CO-OP would organize a Large (as compared to a Group) Buy for different items that they find interesting and that there seems to be a demand for, i.e. pen mill cutter heads by you. The prices will be a little higher, I believe you mentioned 8%, than the Group Buy was, but with the extra money they will keep on hand some extra cutter heads, so that someone can buy a few, 10 or 12 weeks later, and not have to wait for another Group Buy. This would mean a price of (I don't remember the prices, so I'm going to make up some numbers, OK) $1.10 from the CO-OP compared to $1.00 for the Group Buy and $3.99 from some online source. (Close enough?)
What happens when you run out of cutter heads? If the minimum order is 500 units, that is what you will have to order. Where is that money coming from? Unless your initial sales and purchase was like 6,250 cutter heads, there will not be enough extra to buy the minimum order. That is also assuming that none of the extra money went to pay for gas labels, printing, etc...
Also, since multiple members are doing this, for different items, I can see where I would need to order 1 or 2 items each from 5 different members. Now I will be saving quite a bit of money by ordering from the CO-OP, but what about the shipping and handling? There would be a point where it would be easier, quicker, and maybe cheaper, just to order from, say, PSI.
That happens now. We can all find some of stuff sold by CSUSA or PSI, a little cheaper on other web sites, but sometimes it is just not worth the bother of ordering 2 items each from 8 different places - and sometimes it might be. I just don't think it would be often enough for the CO-OP.
I will stick to the Group Buys. I have missed out on a lot, because I didn't see one, or have the cash, etc... I did participate in the pen mill buy ou ran (Thank you very much.) but, how often will I be ordering new cutter heads?

Good Luck with it, anyway.
 
Then do it like you did the walnut buy. Either put up all the cash and sell the sets at a profit or get a few investors and divy up the sets. Each to do what they want with the sets. If you can offer them at such a great savings then you could make some profit. Offer them on ebay also. It really sounds like you are burnt out on doing group buys.Which you have a right to be. Pass the torch for awhile and let others do them. It sounds like you really like doing them, but have found that it really is taking up time the family wants and needs. So it's come down to I need to be paid for my time and expenses. When you get to this point you have gone from volunteering to I'm burnt out. That's normal.
As for your vision on all this as a co-op. You are basing things on volumes you see in the group buys. It won't be the same in a Co-op. A lot of people, me included, buy in the group buys just in case I may need those. I've got more drill bits, kits, and pen blanks than I'll ever have time to turn. I'm sure a lot of members are in the same boat. When it's an all volunteer buy then we tend to help out to meet the required # for the best savings. I'm not sure that would happen with what we know are inflated prices, even if they are cheaper than retail. Then there you are stuck with inventory. Things like CA glue or Enduro couldn't be kept in inventory for too long due to shelf life. So, we take most pen kits, CA glue, and finishes off the list of items the CO-OP would purchase, what does that really leave? Just more thoughts for you to ponder over before you try and make this work.
 
LanceD said:
One scenario

I can see that you will have a nice inventory on hand. Kits, bits blanks etc sitting in a few boxes in your house or garage and everything has it's price.

Well someone says I can get these same items at an even lower price by starting up a group buy. He starts a thread advertising his buy and everyone jumps in because the group buy prices are lower than the co ops prices. He purchases his products and distributes them the same as always in two or three weeks and everyone is happy because they bought their supplies and saved a good bit of money. The items purchased to start the co op is still sitting there in boxes with no one interested in purchasing them because the group buy items were cheaper than the co op items.
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And that would mean that if I wanted a few of the items at a better price, I would be forced to wait for someone to maybe do a group buy on that particular item or pay the full price for it instead of buying it at a savings from the co-op. I am all for this idea, it won't be hurting any of the vendors we use now, but if that was the case, maybe we should do away with group buys so the vendors can make a higher profit.
 
We generally do group buys THROUGH the vendors so they still make their cut and stay in business. Kauri, CSUSA kits, Berea kits, Acrylic blanks and so on have generally all gone through the actual vendor that we would normally buy from. The difference is that we pool our money to get a better discount. If we order direct through the mfg we become importers in most cases and eliminate the normal vendor all together. While I doubt that the $$ they wouldn't get from a group buy month after month may not hurt them short term, over the long haul there is a lot of $$$ not going into their business and the business might not be coming out with as many new products. This eventually hurts all of us.

However, if the minimums are small enough for orders of items not normally ordered in group buys then it may pay offin the long run. I'm not sure anyone would want to invest their time for such a long duration for no pay.
 
I've had several ideas about how to deal with this. one is the way I did the walnut.
ont he walnut idea specifically, that was the single worst bulk buy I have ever done in some ways. in some part it was due to things that are specific to that situation, and would not apply to getting in vestors to buy the bits. one difference that does matter is the amount of money. for tha walnut I was asking for 5 investors at $120 each. in this case I would need 5 investors at over $1000 each. Just off the top of my head I am thinking this is unlikely.
 
I'm confused. I can drive 2 miles and buy a set of 115 TiN bits for about 80.00. For a few bucks more I can add the over 1/2 bits that I need. And thats undiscounted and over the counter. Since I drill wood and plastic and don't need hyper accuracy, that's 3 times what you're offering for about 30% more. One of the points you're missing is that you simply won't have the buying power a commercial supply chain has.

Daniel said:
So everyone knows just what sort of deal I am talking about when it comes to drill bits. a full set of TiN bits (35 bits) for $77.00 to your door. that is barely over $2.00 a bit and includes all the over half inch bits. a 14mm TI bit from MSC alone costs $105.00. Just one bit out of the set costs more than the entire set. I cannot find complete set of Ti bits anywhere for any price. MSC doesn't list Ti bits over 1/2 inch in there catalog. to get just HSS bits in all these sizes would cost about $250.00.
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Not only have you confused us by first giving the impression that this would be an "IAP CO-OP" ("I have contacted Jeff concerning the above thoughts, and basically what has come out of our brief conversation is exploring the possibility of organizing a I.A.P. CO-OP.") ..........

but now, as it turns out, this wouldn't be a CO-OP at all. The fact of the matter is that you are interested in lining up partners in the hopes of bankrolling a profit making business.

There's a big difference between a profit making business and a CO-OP. Unfortunately, I see it as another example of certain members wanting to profiteer from our "IAP family". I guess that's how capitalism works.

As for me ..... I'll stick with the everyday Joe IAP member who, out of the goodness of his heart and true desire for helping fellow IAP members, decides to run a group buy for the benefit of all .... not just a few. Get it?
 
Daniel,

I just read a few posts in this thread and skimmed through most of the others so excuse me if I am missing something here but here are my thoughts.......

I think there is no need for a CO-OP, as described in this thread for pen supply purchases.

I also think you are starting to take things too personal when someone says something against the CO-OP idea.

I've done several group buys and know what's involved, one last year exceeded $7,000, so please don't go there with me as you have with others.

I guess we all look at group buys differently and I have never made a nickel from the buys I have done and have actually lost a few dollars now and then due to unexpected postage, etc but NEVER did I consider fellow forum members and friends as "Customers" of mine and never thought about how much toner I used in printing out mailing labels or what the gas cost driving to the post office! It's not a business to me and I never thought of these buys as ways to make money but I do see a growing trend on the forum where others do see them as ways of making a few bucks.

It sounds to me like this CO-OP is just a way to make some money by one or a few! If I want to save 25% off retail on a pen kit, I'll contact a few friends, order 100+ kits and ship their portions to them while charging them the kit prices, actual postage and paypal fees. It's as simple as that, doesn't need to be VERY COMPLICATED as you have mentioned in several of your posts.

If the mere concept is so very complicated and difficult to explain, just imaging how complicated it will be to actually get rolling!

I don't see where a CO-OP saves anyone anything and don't see a need for one. Just my opinion....... don't take this so personal.

As for me, if I run low on a particular item and want to save on ordering some more, I'll just start a thread saying "Group buy" and be done with it!

George
 
Tom, I had to paste your comment in my reply field just so i can adress everythign you mention. So this reply is going item by item down you comment.

as far as some of thiese things are concerend including cutter heads they are already getting to complicated to deal with. this is the whole reason I started thinking of other ways to do buys at all.

you ,mention numbers like 8% markup, CO-OP $1.10, Bulk Buy $1.00 and vendors $3.99

8% mark up is what a current on going bulk buy has to add to orders to make up for ongoing expenses that accour. the CO-OP would mark product cost up more like 100%

final numbers in this case is that the Co-Op coudl do this and still offer prices at $1.10 while group buys do not even offer the item and vendors charge anywhere from $2.20 to $90.90 for the same item depending on what it is.
The mark up the Co-Op woudl charge would be determined by what price a product can be bought at and what is a good deal for that product.

I think the CO-OP could compete directly with Bulk Buys on some items (Pen Kits and acrylic blanks) and provide them at even a lower price than group buys do. But I would not want to see this happen if it ment stepping on anyones toes. Consideration of others is sort of a standard around here and I would expect that to be one thing that determined the decisions of the CO-OP.

ONly the first buy in a CO-OP ould be structured like a group buy. with moey being payed up front for goods promised. after that it woudl be expected to "Hoe it own roe" so to speak.

In some real life numbers. i do a buy for drill bits for the price of $77.00 for a full set of Ti bits. i must actually collect 50 orders at this price. i will then place an order for 100 sets. i wil mail all prepayed orders and keep the other 50 sets to sell over time at the same $77.00 price that everyone else bought them at. excet now all cost of the buy have been paid. every set I sell from now on is money staying in my pay pal account. when those sets are sold i have $3,350 in my pay pal account and need to order 100 more sets. so I do but this time when all 100 sets sell I have $7,700 in my pay pal account. I order 100 more sets and can order some new stuff. well during this time I've had people asking me if there are other sizes of bits they can get, can they get jsut a couple of 7mm bits to keep around or whatever, well now not only do I have ome extra money I have some Idea of what to do with it. In the mean time I have someone e-mail me about ink refils that are really good but you have to buy a bunch of them at one time. so maybe the CO-OP will take this idea and run with it.
in each case every time the CO-OP buys and sells an item it doubles it's money (only in a perfect world) and is able to buy other things that are brought to it's attention as this money grows.

for now there coudl actually be a large amount of money that could be used in getting various items. if this idea does get started this list will grow even larger. but eventually there will be no need to double the money of the CO-OP and adjustments will need to be made. I woudl hope that it could eventually be more like a 10 or 15% mark up on a lot of item but there is no way of really knowing that at this time. this also causes a problem for people that pay $77.00 today for a set of bits when there are people only paying $45.00 for a set two years from now. The only thing I can really say about that is it is part of the cost of helping the group do new things. i wanted to say bigger and better but in fairness what is better is a matter of opinion.
The above does not consoder other expensis and so is not a literal description but as can be seen the fewer other expensis there are the greater the benefit to the group in the way of new items being found bought and offered for sale.

In regard to having to shop from multiple sources. the way group buys are now you can only get the price break if there is a group buy going on when you need to buy and for the items you need to buy. this situation will not be mcuh of a challenge to improve on. There a re several way that actually orering could be handled. Right off the tip of my head I like a web site that to you look like just any other web site that you buy from. behind the scenes the orders are being sent to the various accounts and people they need to. the biggest difference to you woudl be when you start getting multiple packages delivered for what seemed like one order. this is something people would simply become used to. this is not the only way to deal with this just one idea.
as far as prices. I like to setprices that include everything. it is simpler for the customer. So I would like to see prices that have nothing added to them so you know what you will pay and in actuallity would not really care what bills had to get paid to get the items to your door.
as far as beating anyones price. For the specific items i am looking at now this is a non issue. nobody even offers some fo htese items and even if they did it woudl be very hard to bet the price. maybe if I mailed each bit to you individually and even then I think you could save money in that case. of course there is always that one exception. I tell people when I know they can get a better deal. and in some cases this will be true. not every combinatioin of products can be figured. this is up to the person buying


On this issue I will first say you are welcome for the group buy on pen mills, and thank you for being a part of it.
You point out one fo the single biggest issues for me in this whole thing. How soon will you want to buy anouther cutter head? Hopefully never I like to think i provided you with that good fo a product. But since this is not likely, i know I have owned mine for a couple of years and not planning to need to replace it yet. I did buy a bunch of heads during my group buy but that was more to pamper myself than any real need.
But how many other people do need heads or sets. but because almaost every member that wanted or needed cutter heads did order them. those that are still in need are sort fo left out in the cold for a while. maybe even quite a while. this kills group buys as a realiable source of any kind and also fails to fullfill the very base reason for a group buy. to provide low prices on products. when a group buy is not offering anythign to anyone 50 weeks out of the year sorry but my vote is that it is not doing what it is supposed to be doing for 96% of the time. This may not mtter to anyone but me but it does matter to me. i managed to meet your need on that one item, But I also want to meet the need for the next person and the next after that.
on that note bulk buys miserably fail.

thanks for your post.
 
well due to comments like Docs above, not the only ones I am ending this thread and will request that it be locked. I don't need to be insulted by the very people I am trying to do things for.
thanks for the comments that where actually questions and concerns.
 
It's my understanding that a CO-OP is formed by a group of consumers with the sole purpose being to benefit those consumers. Any profits from the CO-OP are used to benefit the group of consumers who are also the members.

What you're describing as a "CO-OP" is actually a business venture in which you are seeking partners who will financially benefit from those of us who are your customers.

The way I see it, a "CO-OP" and your business venture are two different things. When I read your first post yesterday I was excited by the idea of ALL of us IAP members somehow forming a true CO-OP and using our joint buying power for ALL of us to benefit equally.

There is no need to be insulted by my statements. I'm simply trying to help sort this thing out so we are all on the same page.
 
Well I am a newbie lurker to this group and have not turned the first pen, but I have been involved in retail, wholesale & purchasing . . . .

Let me save you some time and effort & bring you into the real world for a moment that is not supposed to exist . . .

First off, as soon as you become a competitor and cost one dime by any means or method with people who have invested millions into being a "TURNING" supplier you will learn about something called pricing structures. Meaning you will be at the crappy end . .

Example:

Frank has built a small business cutting and selling pen blanks. After doing so for several years & selling everything he could by way of mouth to individuals, one day his phone rang & it was PENNSTATE & they told him they would buy ALL his blanks at a price they negotiated. Do you really think Frank is going to risk angering PENNSTATE to sell to you at a price low enough to compete with his best customer & lose that $3,000.00 check that has been coming in for the last 2 years. In case you don't know the answer to that, it will be NO!!!

I use Pennstate strictly as an example . . .

Another thing to consider, there are very few hobbies that allow you to actually turn a profit. There are even fewer hobbies that have dedicated solid suppliers as this hobby does. The day you take the even the smallest portion of marginal profit out of carrying pen supplies these big boys will simply drop pen supplies and move on. Now we are stuck with you who has no buying power. You see, in this country ever time someone build a profitable business there is always some "sharp" shooter that wants to come along and grab the gravy. Well my friend capitalism is older than you & any time you try to turn a profit under the guise of helping others you will always be shot down.

If you truly want to help IAP, then simply buy at the group buy discount and offer for @ list to members. Then the profit could be put into the coffers of IAP. But I can assure you, no retailer will allow you to buy from him @ a discount and sell to his customer base @ a lower price then he has deemed necessary to make a profit and continue to operate. Do you really expect a supplier to swallow the cost of maintaining a purchasing department, a warehouse & a sales staff so that he can sell to you at a price low enough for you to RESELL for the same or less than him . . . .? If he were that stupid he would not have a successful business . . . .

I could go on, but I'm sure you would not appreciate it . . . .

Steve
 
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Thanks to everyone for the great comments. Daniel has told me he's gotten the information he was looking for and asked me to close this topic.
 
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