Quote:
Originally Posted by Mrmaddbrad
Definatly agree with the idea of going to a bank and getting a loan to start this business man!
But if its money up front that you need, why don't you just ask for cost of materials up front, put in an order. Make that one top, send it after they pay the rest in full.
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Banks won't loan you a dime unless you already have your business up and running and can show them a strong financial history of sales/profits. OR if you're willing to put up personal collateral, like the equity in your house, against the loan. What Z-art really needs is an angel investor/partner.
And the problem with asking for material costs up front is that its very hard (if not impossible) to buy only the material needed to produce one unit and even if you could, it would be too expensive.
To get a decent price on raw materials, a manufacturer has to buy in some level of bulk and it appears that z-art has determined that means a minimum quantity of 20 units before he can start up production.
I recently purchased the design of an electronic controller and had to fund the manufacture and assy of 50 circuit boards out of my own pocket in order to meet the cost/profit/price target. Any fewer and I either had to raise the price (and lose sales) or not make any profit (because of higher material costs).