Wednesday, April 1, 2015

Is it feasible to start an online co-op?

There are a lot of things that aren't really perishable that you can buy at ridiculously cheap prices in bulk.

Many seeds, nuts, and grains are sold wholesale for less than half of what they sell retail, but you have to buy massive quantities to realize savings.

Examples include Almonds,Raisins, and Walnuts  but there are many more products like this.

Would anyone be interested in joining an online co-op for goods like this, so that we could coordinate massive purchases, store and process the goods, and then ship them out to end users?

Getting bulk fruit and nuts for 60 cents a pound, and then processing them and shipping them out might end up costing a lot more than you'd think, but a lot of people are spending 5 dollars a pound or more on this kind of stuff.

The primary downside is the massive number of people who would need to sign up before it would be worth doing.

I don't eat more than 2 pounds of nuts in a month, and even at that relatively high rate of consumption I would only eat 24 pounds a year. If I could find people that ate just as much as me, that would require 1,667 people just to use up 1 minimum shipment of 20 tons from a wholesaler.

Here's my math, easily computed using either mental math or the knowledge engine of Wolfram Alpha.

I like to eat nuts, around 2 pounds of them in a month.

2 lbs of nuts per month works out to be 24 pounds of nuts a year (2 *12=24)

24 lbs of nuts a year versus the minimum purchase amount on Alibaba of 20 tons works out to 1,667 eaters minimum to finish all the nuts in one year (20 tons*2000 pounds / 1 ton / 24 pounds per person =1,666.6 repeating, and half of a person doesn't eat any nuts so I rounded up)

With more people than 1,667 I could have reduce the single person's cost to participate, achieve shorter intervals between orders, increase the variety of orders, i.e. send out nuts and raisins, seeds, or dates instead of just nuts, and make orders smaller.

So, if you know anyone looking to provide some seed funding, I guess that I'm interested.

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