Prepaid Phones Dealers - How to become one?!

Transcription

1 Prepaid Phnes Dealers - Hw t becme ne?! Mbile phne distributrs are a critical part f a prepaid wireless prvider's success! D yu want t becme a cell phne distributr? Here yu'll learn abut what it takes t be a wireless master agent, hw it wrks, the technlgy invlved, and mre! The fact is that the wrld f mbile phne distributrs is fascinating, and can be the life bld f many wireless carriers. What are cell phne distributrs? First, let's define what exactly a distributr is and des. Different peple will have different definitins and describe varius scpes f respnsibility, but generally speaking the fllwing is very cnsistent. Having wrked directly with prepaid wireless distributrs fr many years, I feel cmfrtable that the fllwing infrmatin will help yu get jump-started n becming knwledgeable! Distributrs are ften referred t as Master Agents. This is because they are at the tp f the fd chain if yu will. What that means is that while a distributr r mater agent may smetimes sell phnes and airtime directly t custmers, they typically mstly sell whlesale t dealers. In turn, dealers have their wn stres, but als sell whlesale t smaller stres. Smetimes there is even a sub-dealer between the dealer and stre level (see the diagram belw t see the varius pssible levels f distributin). A cell phne distributr will buy phnes and airtime discunted directly frm prepaid wireless carriers. They will then mark up the price and sell it dwn t the next level. Mbile phne distributrs can have relatinships with dzens, hundreds, r even thusands f stres underneath them. The layers under them are ften referred t as their sub-distributin. Depending n the size, reputatin, and plicies f a prepaid wireless carrier, sme wireless distributrs wn't be able t wrk directly with the prepaid carrier. In ther wrds, as a wireless distributr, yu culd have a direct relatinship with the prepaid carrier, r yu may have t wrk as a sub-distributr under anther larger master agent wh is wrking directly with the carrier. What's the best level? This can becme a very persnal decisin. Are yu the type f persn wh wants t run a large distributin netwrk, and deal with the peratins and warehusing that cmes alng with that? Or are yu the type f persn wh enjys wrking day t day directly with the custmer? The answer will likely be a cmbinatin f what yu enjy, as well

2 as what yur strengths and capabilities are. There's n dubt abut it that the higher yu are n the mbile phne distributrs fd chain, the mre mney yu'll make, and the faster yu'll make that mney. The simple reasn is because nce yu have a netwrk f sub-distributrs and stres, yu'll be able t sell hundreds, r even thusands f phnes in ne deal, versus the bttm f the chain, where yu'll be selling ne phne at a time t the custmer, which practically speaking, will simply take mre time. But fr that apparent ease, yu'll have mre risk. Cnsider if yu were t buy 10,000 phnes frm a prepaid carrier. If yu dn't have the peratins in place t receive and ship ut thse phnes in an efficient manner, it culd take yu sme time befre yu get the prducts in the hands f thse wh will actually be selling them. And that desn't include the cst f paying fr the phne (r airtime) inventry, and the cst t stre it. Mst prepaid carriers require that distributrs prepay fr inventry! Sme will give yu payment terms (ex. 10 days r 30 days), but that is becming less cmmn these days. Even with payment terms, yu'll still need t get the prduct ut, and get paid in time t pay the carrier fr the inventry. As a side nte, I've seen mre than a few mbile phne distributrs wh have been extremely cash-strapped, and n the brink f bankruptcy, even thugh they sell millins f dllars f prepaid prducts each mnth! One peratinal issue, r truble cllecting mney frm yur sub-distributin, and yu're tast! But dn't let that scare yu ff. Thse issues really cme dwn t pr management, and perhaps greed trying t grw their business t quickly. If yu're wise, yu shuld be able t prfitably (and safely!) build yur business withut being n the edge f disaster. Are yu interested in becming a cell phne distributr? It's such a fascinating industry with s many pprtunities, and s much t learn! If yu haven't already, read the intrductin t Mbile Phne Distributrs; if yu have, cntinue reading: What d I need t becme a wireless distributr? Relatinships - Yu'll need t have relatinships with sub-dealers r stres. In my pinin this is the mst difficult part. Building relatinships with ther dealers and/r stres is nt easy. It takes a certain kind f persn t seek ut such pprtunities and t sell yur services. And because f the amazing ptential t make a lt f mney in the prepaid wireless distributin business, cmpetitin is fierce! Yu can target a specific neighbrhd, type f mm and pp stre, small cnvenience stre, etc. Think abut where peple might want t buy a phne r tp up their prepaid accunt. Als cnsider what unique value

3 yu can add. D yu have special knwledge, insight, r existing relatinships with a specific type cmmunity? This shuld be cnsidered a critical success factr, and will largely determine whether yu shuld be a master cell phne distributr at the tp f the chain, a smaller ne, r smewhere in the middle. There's really n "wrng" place t be. Wherever yu fit in, and can apply yur passin, yu'll have a chance t succeed! Access t Technlgy - Depending n where yu are n the fd chain, yu'll need t have technlgy t prcess airtime sales. Usually the master cell phne distributr will prvide access t technlgy t partners underneath them, s lets assume yu're at the tp fr the mment. Yu'll need t partner with a Technlgy Service Prvider (TSP). TSPs have als have relatinships with prepaid carriers. The larger nes will have direct relatinships, while the smaller nes will have indirect relatinship. The clser they are t being direct, the mre mney yu'll likely be able t make. There are a number f technlgies currently available, and depending n the dealers/stres that are selling yur prepaid prduct, yu may need ne r all f these: Ht Cards - These require minimal r n technlgy, and can ften be purchased directly frm the carrier. I wn't fcus n this much, hwever, because ht cards are largely being phased ut f the market, and many carriers have already discntinued using them. POS Terminals - These are Pint Of Sale Terminals that typically lk like credit card terminals. They can be used t sell electrnic PINs (epins) r t perfrm PIN-less Real Time Replenishment (RTR) transactins. Web Terminals - These are secure websites that prvide the same prducts as d POS terminals, but can be accessed via the Internet, withut the need fr special hardware r equipment. Internet access, hwever, IS required. T read abut these technlgies in detail, visit the Pint Of Sale Technlgy page. As a cell phne distributr yu'll need t gain a gd understanding f these replenishment technlgies s yu can sell yur services t dealers and/r stres. Yu may nly need ne f them r all f them. Remember that yu need t keep in mind the needs f YOUR custmer (dealers/stres), as well as what the end users (wireless custmers) need and prefer. Believe it r nt, these are nt always the same things! Special Nte: Depending n hw large yu are, as well as yur relatinship with yur TSP(s) and sub-distributin, yu may be able t get these technlgies frm free, yu may have t buy them utright (ex. terminals), r yu may be able t lease them. Depending n where yur business lies in the fd chain, yu may be able t pass any csts dwn t yur sub-distributin.

4 Mney - Yu'll need t either have cash n hand, r access t mney frm banks r lenders. Yu'll need this mney t pay fr technlgy, warehusing, staff, and f curse, prepaid phnes and prepaid airtime. Althugh peple tend t wrry the mst abut getting mney, I put it last because it really is the easiest part f the equatin! If yu have gd relatinships and access t technlgy, yu're well n yur way t building a successful cell phne distributr business, and finding the mney will be the easiest part! Hw d I get paid? There are different ways a wireless mater agent can get cmpensated, which can depend n where in the chain yu are, the size f yur business, as well as the plicies and practices f different prepaid wireless prviders. Phnes/Handsets Whlesale - Yu'll buy the phne at a discunt frm the prepaid prvider r smene abve yu in the distributin chain. This is ften referred t as a margin mdel. Spiff - Yu'll get paid fr each phne yu activate. Mst relevant t the stre level. Nte that smetimes a margin and a spiff will apply. Smetimes the spiff can als be shared by different levels within the chain. Airtime/Replenishment Similar t the whlesale mdel, yu'll get a margin fr each replenishment sale. Nte that sme prepaid prviders will pay different amunts fr different prducts. Fr example, yu might get paid less fr epin sales than fr Real Time Replenishment (RTR) sales. Airtime margins are usually shared between the different distributin levels, and mstly depends n the nature f yur relatinships. Cnsider if yu have at least happy custmers wh cme back t yu every mnth fr tp-up, if yu are fllwing a retail strategy f flding the market with lw-cst handsets yu will reap the rewards f replenishment vlume. Accessries Making mney frm selling accessries is an ften under-perfrming part f the business fr mst dealers, cnsider if yu sell just ne accessry at a 100% markup n each phne sld, this is an pprtunity fr anther revenue stream, it is very imprtant that the prepaid dealer has a plan fr selling accessries and the ability t reap the rewards

5 Want t Sell Online? After reading abut becming a cell phne distributr, sme peple will be excited abut the pprtunity, and feel that with the right mtivatin, yu can be successful. Hwever, sme peple will cme t the cnclusin that yu dn't want t wrry abut the hassle f dealing with a brick and mrtar business, and the smetimes cmplex relatinship management and peratins that is needed. But yu still want t sell prepaid wireless phnes and prepaid wireless airtime nline! The gd news is that yu can actually be an nline wireless master agent using nly basic relatinships; i.e. n headaches! With n lead time, and n ut-f-pcket cst, yu can easily sell nline. Yu'll basically put affiliate links r banners n yur website, and when peple click ver and cmplete a purchase, yu'll get paid a cmmissin. Once yur business gets bigger, and yu want t invest sme mney, yu can integrate these services right int yur website, s visitrs/custmers never leave yur site. Once yu click ver, yu can signup t becme a distributr r reseller. As I said, there are ther ptins fr selling airtime and handsets.