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YOu you must have such amount that you can,
01. Cover the cost related to stored spare parts.
02. Cover the office staff's salary for minumum6 months.
03. Cover the office expenditure for minumum6 months.
it depend on the industry (what you are going to serve for )
your vast knowledge in the industry and the fast running parts .
the flexable payment to suppliers and maximum down payments from costumers .
OEM ,ODM suppliers in hand .
smart marketting and fast circulation can reduce your capital load .
in genral you will need to have the arrangement for6 monthes for
1-salaries 2-rents 3-other expenses 4-parts
Its completely depend upon in which country u r establishing business. what type of payment terms you are offering to your buyer and what type of payment terms you are having with your suppliers. Majority of buyers would like to deal on open payment terms like creidt or CAD at sight via. bank. If you can negoitate LC payment terms with your buyers then that would be added advantage for you. based on LC u can get loan from your bank for further business and also your risk will be covered.
Prominent point is you will have to have that much capital that Operation costs should be covered.
It depends on the country in which you are going to operate. You just need to cover your operational costs, provided that you have a suitable office for your business.
The amount to cover all my business costs to survive for6 months even if I dont sell a single spare part.
the answer is depends on
1- The type of spare parts.
2- The market share that is needed
3- The power of competitives
The exact figure will depend on where you are, how far is your supplier, and the cost of spare parts you will be trading in.
If your collection will be cash on delivery, I think you will need the cost of purchasing the economic order quantity of the spare parts based on your forcasted sales and the cost of running the business until you reach the reorder point.
If your are going to sell on credit, you will need to account for for the cost of goods you will re-purchase and the cost of running the business until you collect the value of the sold goods.
A spare parts agency is mainly cope with the end user of these spare parts, so far it need a massive survey on market to determined the market demand to satisfy your clients, also the distribution among the market, the marketing expenditure, after sale services, and store expenditure. Its not so easy job it need clear study
I t depends on the volume of this trading , but any way i don"t think less than L.E.
