$FNHI
CEO insights to the type of guy he is.
An e-mail I just got from him 30min ago.
Hey, Tom
AutoZone buys through AutoAnything right now and they buy single order pieces (drop ship). As we grow and become funded, holding sizable inventory - that relationship is poised for growth. At this time they can consume up to 25 units per day, which is 500-700 per month. However, that's only based on very early figures where we have been back ordered (out of stock) on a lot of our main sku's. As we grow our inventory we believe our numbers will evolve to the higher side.
We've already started the ground work for shared manufacturing in Mexico.
To elaborate more:
Each decent account we land will require an investment of up to 250K in inventory cost. That ranges from 25K (smallest) to 250K to a fairly busy online retailer to smaller distributor. That should turn monthly and begin generating net earnings within about 120 days. At that time, that dollar figure in deployed inventory would turn us a 30-40% on the investment quarterly.
So 1MM in inventory will start to make 900K gross profits every year. High inventory levels will be about 5MM (at this time, but that may grow, as we grow). That's where the 5MM will turn four times for revenues of 20MM with earnings at (gross) 5MM.
These are all high level figures and will change as the "economies of scale" prevail.
Steven Rossi
Truxmart
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