Forums: Discussions for entrepreneurs and small business.

Hello, this is my first time posting...so take it easy...

I have always been in this business but want to take it to another level and wanted your opinion.

I am involved in wholesale distribution of Orchid Leis.  These are the big beautiful leis you may see around people`s necks during graduation ceremonies (at least thats the new trend out here on the west coast).  The company that I am involved in distributes it to flower wholesalers, Costco, and other florists.  These people are the middle men who jack up the prices by 200-400% by the time they get to the people.  For instance, I may be able to get the leis for $12-15 (depending on the volume) and they turn around and sell it to people for $35-60 each. 

My idea was to cut out the middle men and target high schools and colleges as a fund raiser or money making opportunities for worthy students (kids who needs extra money for school).  I would sell them the leis for $15 and they can sell it for at least $30.  If at a public H.S. they graduate 500-750 students and 1/4of them buy the leis, there is a potential of at least $2000-3000 profit in a few short hours!  This number is on the conservative side.  My experience is that once a parent/family member/friend sees another graduate with the lei, they would want the same for their own.  It becomes a chain reaction. 

Everyone benefits...I make money, the school/student can make money, and the graduates get the leis for a big discount.  These leis are very durable in nature and can be fed-ex anywhere.  They will last up to a week once they arrive at the wherehouse.  One of the drawbacks is that this business only peaks during graduation season (May/June).  But there is a whole lot of money that can be made during that time. 

I just don`t know how to go about marketing it or seeing this thing through.  What are your thoughts?  Is my idea too far fetched?  I would appreciate any feedback.

Getting into a business based on a trend, iffy.  Will the trend last long enough for you to recover the investment and make decent profits?  Will the volume in May and June generate enough revenue?  How much do you need to generate?  How much are you capable of generating?  And, how much will you have to generate to make profits?  Will the distribution company be marketing this or is this something you are doing on your own, separate from the distribution company?  I know, I`m adding questions when you wanted answers but alot of questions have to be answered before you can find out if this idea has merit and makes sense on paper and in profits.  Do a good amount of research to see what the market is and go from there.   

This sounds like a good opportunity, however it also sounds like there may be some more research that you need to complete.  The mark-up looks to be healthy.  Have you created an spreadsheet to verify your business model?

The graduation market seems to be quite seasonal and I think your price of $15 seems to be a bit on the low side.  What other markets can you sell the leis in to?  How about for weddings, bar/bat mitzvahs and other events?

Good luck with you plans!

Welcome saysum!

What a cool business! It sounds like a great opportunity for seasonal/event revenue. It might be a good idea to start with the local PTAs in your area to see what interest is. This could help you to see a slice of what the volume would look like with minimal to no investment as many of the fundraisers pre-sell via order form. Just be ready to fulfill! It will also give you exposure with the bar/bat mitzvah, sweet sixteen, and quinciera clients: the kids!  (hey c`mon now, has anyone seen those sweet sixteens on MTV? )

Hope this helps!

Best of luck!