If you are a retailer do you buy the product then sell it at a markup? Or do you send it back to the maker?

Question

for instance does an auto dealer buy the cars then sell them for a profit? Or does he just return them to ford if he doesnt sell them?

Answer 1

I have never hear of an auto dealer being able to return unsold autos for a refund. Many have gone out of business because of poor business decisions concerning how many and when to buy either new or pre-owned auto inventory.

If your a regular retailer weather you work from a store, your home or a warehouse, you buy at wholesale prices based upon quantity pricing for example, 1-10 @ $10.00 per each unit, 11-20 @ $9.50 per each unit,  21-30 @ $9.00 per each unit.

You sell at a retail price that provides you with the margin of profit that you have determined let's you make the gross profit necessary to cover all expenses including payroll and commissions and return an additional margin of profit that will be your return on your invested funds. Some of the invested funds will be the actual cost of units purchased.

If sales are slow or non existent you must lower your selling price and make less or no profit or possibly lose money to get rid of inventory.

Almost no wholesaler will provide merchandise on a consignment basis which does permit returning of goods usually for credit against future orders. If you look hard enough you might find a few however be cautious.

Answer 2

i'm confused, but i'll try to answer your question. a retailer would buy all their products at wholesale cost then mark it up for a profit. the auto dealership more than likely does the same thing, but i'm not sure what you're trying to say about ford. do you mean the dealership sells back to a ford manufacturer? if that's the question then no.