In this article, the modern Merchant model will be explored as a means of achieving rapid growth in commodity trading. This model focuses on identifying and seizing niche markets within the supply chain, which are often overlooked by larger companies due to their small size or complexity. By leveraging technology and a touch of innovation, the modern Merchant can penetrate these markets and achieve significant revenue growth.
The article will delve into the challenges faced by international trade companies and how the modern Merchant model can offer a solution. The article will also provide a breakdown of revenue growth and an understanding of the Merchant role. Additionally, a case study of Grumbar Energy’s Wood Pellet Trade will be examined, along with lessons learned from failures. Finally, the article will explore leveraging technology for growth and how to penetrate niche markets in the supply chain.
Key Takeaways
- The modern Merchant model focuses on identifying and seizing niche markets within the supply chain.
- Leveraging technology and innovation can help penetrate these markets and achieve significant revenue growth.
- Understanding the Merchant role and identifying opportunities in the supply chain are key to success in commodity trading.
Our Success With an Old Business Model
The company mentioned in the video has achieved rapid growth using an old business model known as the modern Merchant model. This model focuses on a niche part of the supply chain where there might be a hidden market waiting to be seized properly. The modern Merchant model is a revised version of the old Merchant model, but adapted to today’s world.
The B2B Merchant that deals with raw materials, semi-finished products, or commodities has not faced significant disruption, unlike the B2C Merchant that was disrupted a long time ago with the arrival of e-commerce. The modern Merchant model focuses on the middle of the supply chain, where there are multiple niche markets that could be seized properly.
The company has been successful in the biomass trading industry, where they have made over €500k in the last six months. The revenue of the company has grown significantly since February, where they were shy of €4,000, and in July, they made €290k. This growth has been achieved by focusing on niche markets within the supply chain.
The modern Merchant model could focus on a niche market in terms of product, quality, or geography. For instance, a commodity niche market is a market that is too small or too complex for a large company to invest in but big enough for small and medium firms to make a living. The middle of the supply chain is often trusted by large actors that have a low cost of financing, so most of the opportunity is found at the top or bottom of the supply chain.
The distribution stage in the commodity/raw material world is when you buy in bulk, stock in a warehouse, and then resell it by pallets. Distribution is a pain to manage because you have to deal with constant payment issues, logistic issues, bad customer weather, and it’s very hard to find good employees to work at a warehouse. However, with a slight touch of technology and the fact that everyone is glued to their iPhone, the experience of running a distribution arm with your wet is smoother than it used to be.
The agglomeration stage is when you buy from multiple small suppliers to make one big lot that can be exported and bought by a large actor. If you can be this single trusted seller in a rugged region of the world, you are going to make millions. Simple technology could help you tremendously.
The modern Merchant model has been successful in the biomass trading industry, and the company plans to grow 100x by reviving this old business model with a touch of technology. The company’s success demonstrates that there are still massive opportunities in the physical world, where there is less competition and less chance of getting destroyed by the latest 1000 IQ 5 brains no sex live upcoming kids.
The Modern Merchant Model Explained
The Modern Merchant Model is an old business model that has been revived with a touch of technology to achieve rapid growth. The model focuses on a niche part of the supply chain, specifically the B2B Merchant that deals with raw materials, semi-finished products, or commodities.
The primary role of a merchant is to acquire goods or products either by producing them, purchasing them wholesale, or importing them, and then selling them to consumers or other businesses at a markup. While the B2C Merchant has been disrupted with the arrival of e-commerce, the B2B Merchant has not faced significant disruptions.
The Modern Merchant Model takes advantage of the fact that in any part of the supply chain, there might be a niche market hidden that is waiting to be seized properly. For example, in the wood pallet supply chain, there are multiple niche markets such as the wood trading market, the wood chips and sawdust market, and the distribution market.
A commodity niche market is a market that is too small or too complex for a large company to invest resources in, but big enough for small and medium firms to make a living. The middle of the supply chain is often trusted by large actors that have a low cost of financing, so most of the opportunity can be found at the top or bottom of the supply chain.
The agglomeration stage is when a merchant buys from multiple small suppliers to make one big lot that can be exported and bought by a large actor. The modern merchant knows that an international company that buys a 50,000 metric ton vessel load of anything won’t engage a dozen of small local suppliers to get the volume needed. They want to speak with one single seller that did the job of checking the quality, providing the traceability, making sure everything is coming compliant with whatever certification, and more.
The distribution stage in the commodity/raw material world is when a merchant buys in bulk, stocks them in a warehouse, and then resells them by pallets. Distribution is a pain to manage because it involves dealing with constant payment issues, logistic issues, bad weather, and finding good employees to work at a warehouse. However, with a slight touch of technology and the fact that everyone is glued to their iPhone, the experience of running a distribution arm is smoother than it used to be.
In summary, the modern merchant model focuses on finding niche markets in the B2B supply chain and taking advantage of them. By being the single trusted seller in a rugged region of the world, merchants can make millions. With the help of technology, running a distribution arm is now easier than ever before.
Challenges in International Trade
International trade presents several challenges that companies must overcome to succeed in the industry. Some of these challenges include:
- Competition: The global market is highly competitive, with numerous companies vying for market share. This makes it difficult for new entrants to establish themselves and compete effectively with established players.
- Supply chain complexities: The supply chain for international trade involves multiple actors, including producers, processors, distributors, and retailers. This can make it challenging to manage logistics, ensure quality control, and maintain compliance with regulations.
- Financing difficulties: Financing international trade can be challenging, especially for small and medium-sized enterprises (SMEs) with limited access to capital. Large companies often have a cost advantage and can secure better financing terms than smaller players.
- Regulatory hurdles: International trade is subject to a complex web of regulations and standards that vary by country and product. Compliance with these regulations can be costly and time-consuming, especially for SMEs with limited resources.
- Political and economic instability: Political and economic instability in certain regions can disrupt international trade and create uncertainty for companies operating in those areas. This can lead to supply chain disruptions, increased costs, and other challenges.
Despite these challenges, there are still opportunities for companies to succeed in international trade by focusing on niche markets and leveraging technology to streamline operations. The modern Merchant model, which focuses on identifying and seizing niche opportunities in the supply chain, can be an effective strategy for companies looking to grow and succeed in the global market.
The Untapped Opportunity
The speaker in the video highlights an untapped opportunity in the B2B merchant industry. The modern merchant model focuses on a niche part of the supply chain, where there is often a market waiting to be seized. The supply chain typically involves a producer, some light processing, bulk vessel or container shipping, semi-finished product processing, and finally distribution to wholesalers.
The speaker uses the example of a biomass trading company to illustrate the potential growth in this industry. The company made over 500k in the last six months by reviving the old business model of the B2B merchant with a touch of technology. The modern merchant model focuses on a niche part of the supply chain where there is often a market waiting to be seized.
The B2B merchant industry has not faced significant disruption, unlike the B2C merchant industry, which was disrupted with the arrival of e-commerce. The modern merchant model focuses on a niche part of the supply chain, where there is often a market waiting to be seized. A commodity niche market is a market that is too small or too complex for a large company to invest in, but big enough for small and medium firms to make a living.
The middle of the supply chain is often trusted by large actors that have a low cost of financing, so most of the opportunity is found at the top or bottom of the supply chain. The agglomeration stage is when you buy from multiple small suppliers to make one big lot that can be exported and bought by a large actor. The distribution stage is when you buy in bulk, stock in a warehouse, and then resell it by pallets.
The speaker emphasizes that with a slight touch of technology and the fact that everyone is glued to their iPhone, the experience of running a distribution arm can be smoother than it used to be. This is where the opportunity lies. The old baby boomers that run these companies are often tired and waiting for someone to clean them up. The modern merchant knows where to look to find these opportunities and how to penetrate those markets.
Revenue Growth Breakdown
The biomass trading company discussed in the video has experienced significant revenue growth in the past six months. In February, the company made just under 4,000 Euros, but by July, it had generated over 290,000 Euros in revenue. This represents a total revenue of over 600,000 Euros in just half a year.
It is important to note that this revenue figure does not represent profit, but rather the total amount of money generated by the company. Despite this, the company’s revenue is large enough to pay for a small team and fund expansion efforts.
The company’s rapid growth can be attributed to the modern Merchant model, which is a revised version of the old Merchant model that focuses on niche parts of the supply chain. By identifying and seizing opportunities in these niche markets, the modern Merchant can achieve significant revenue growth.
One example of a niche market is the agglomeration stage, which involves buying from multiple small suppliers to create one large lot that can be exported and purchased by a large actor. The modern Merchant can become the single trusted seller in a rugged region of the world, providing quality control, traceability, compliance, and other services that large actors demand.
Another example of a niche market is the distribution stage, which involves buying in bulk, storing in a warehouse, and then reselling by pallets. While distribution can be a pain to manage, the modern Merchant can use technology to streamline the process and provide a smoother customer experience.
Overall, the modern Merchant model offers significant revenue growth potential for companies willing to identify and seize opportunities in niche markets within the supply chain.
Understanding the Merchant Role
The modern Merchant model is an old business model that has been revived with a touch of technology. The primary role of a Merchant is to acquire goods or products, either by producing them, purchasing them wholesale, or importing them, and then selling them to consumers or other businesses at a markup. While the B2C Merchant has been disrupted by e-commerce, the B2B Merchant that deals with raw materials, semi-finished products, or commodities has not faced significant disruption.
The modern Merchant model focuses on a niche part of the supply chain where there might be a market hidden and waiting to be seized properly. In any part of the supply chain, there might be a niche market hidden, and the modern Merchant model tips into those niche markets. It could be a niche market in terms of product or quality, which is not traded in huge volume, or it could be a niche market in terms of geography, which is extremely complicated to do business with, or a small geography that doesn’t make sense for any giant to invest in, or it could also be a combination of both.
A commodity niche market is a market that is too small or too complex for a large company to invest resources in, but big enough for small and medium firms to make a living. The middle of the supply chain is often trusted by large actors that have a low cost of financing, so most of the opportunities are found at the top or at the bottom of the supply chain, which are called the agglomeration stage or the distribution stage.
The distribution stage in the commodity/raw material world is when you buy in bulk, stock in a warehouse, and then resell it by pallets. Distribution is a pain to manage because you have to deal with constant payment issues, logistic issues, bad customer, bad weather, and it’s very hard to find good employees to work at a warehouse. However, today with a slight touch of technology, and the fact that everyone is glued to their iPhone, you can make the experience of running a distribution arm with your wet smoother than it used to be. This is where the opportunity is, as the old baby boomers that run those companies are just way too tired and are just waiting for you to clean them up.
The agglomeration stage is when you buy from multiple small suppliers to make one big lot that can be exported and bought by a large actor. An international company that buys a 50,000 metric ton vessel load of anything won’t engage a dozen of small local suppliers to get the volume needed. They want to speak with one single seller that did the job of checking the quality, providing the traceability, making sure everything is coming compliant with whatever certification, local actor, and Etc. If you can be this single trusted seller in a rugged region of the world, you are going to make millions, and here again, simple technology could help you tremendously.
In summary, the modern Merchant model focuses on finding the hidden niche markets in the supply chain, which are often too small or too complex for large companies to invest in. The distribution and agglomeration stages of the supply chain provide ample opportunities for the modern Merchant to make a living and grow their business. With a touch of technology, the experience of running a distribution arm can be made smoother, and being a single trusted seller in a rugged region of the world can lead to millions in revenue.
Disruption in B2C and Stability in B2B
The business-to-consumer (B2C) merchant model has been disrupted by the advent of e-commerce, but the business-to-business (B2B) merchant model that deals with raw materials, semi-finished products, or commodities has remained stable despite the changing world. This is where the modern Merchant model comes in, which focuses on a niche part of the supply chain.
In any supply chain, there may be a niche market waiting to be seized properly. The modern Merchant model tips into those niche markets, which could be a niche market in terms of product or quality, geography, or a combination of both. A commodity niche market is a market that is too small or too complex for a large company to invest resources in but is big enough for small and medium firms to make a living.
The middle of the supply chain is trusted by large actors that have a low cost of financing, so most of the opportunity that one can find are going to be at the top or bottom of the supply chain, which are called the agglomeration stage or the distribution stage. The distribution stage in the commodity/raw material world is when one buys in bulk, stocks in a warehouse, and then resells it by pallets. On the other hand, the agglomeration stage is when one buys from multiple small suppliers to make one big lot that can be exported and bought by a large actor.
The modern Merchant model focuses on the agglomeration stage and distribution stage, which are the areas where the opportunity lies. With a slight touch of technology and the fact that everyone is glued to their phones, one can make the experience of running a distribution arm smoother than it used to be. The old baby boomers that run those companies are just way too tired and are just waiting for someone to clean them up.
In conclusion, the modern Merchant model is a way to revive the old business model with a touch of technology. It focuses on a niche part of the supply chain, which is a commodity niche market that is too small or too complex for a large company to invest resources in but is big enough for small and medium firms to make a living. The opportunity lies in the agglomeration stage and distribution stage, which are the areas where the modern Merchant model tips into.
Identifying Niche Markets in the Supply Chain
The modern Merchant model focuses on identifying niche markets in the supply chain. In any supply chain, there are multiple niche markets hidden and waiting to be seized properly. These niche markets could be a niche market in terms of product or quality, which is not traded in huge volume, or it could be a niche market in terms of geography, which is extremely complicated to do business with or a small geography that doesn’t make sense for any giant to invest in.
A commodity niche market is a market that is too small or too complex for a large company to invest resources in, but big enough for small and medium-sized firms to make a living. The middle of the supply chain is often trusted by large actors that have a low cost of financing, so most of the opportunities that can be found are at the top or bottom of the supply chain, which are the agglomeration stage or the distribution stage.
The distribution stage in the commodity/raw material world is when a product is bought in bulk, stored in a warehouse, and then resold by pallets. This stage can be a pain to manage due to constant payment issues, logistics issues, bad customer service, bad weather, and difficulty in finding good employees to work at a warehouse. However, with a slight touch of technology and the fact that everyone is glued to their iPhone, the experience of running a distribution arm can be made smoother than it used to be.
The agglomeration stage is when a product is bought from multiple small suppliers to make one big lot that can be exported and bought by a large actor. An international company that buys a 50,000 metric ton vessel load of anything won’t engage a dozen small local suppliers to get the volume needed. They want to speak with one single seller that did the job of checking the quality, providing the traceability, making sure everything is coming compliant with whatever certification the local actor needs, and more. If a company can be this single trusted seller in a rugged region of the world, they can make millions.
The modern Merchant knows that there are multiple markets to trade in, and with their infinite wisdom, they tap into those niche markets. By doing so, they can find success in the supply chain and grow their business.
Case Study: Grumar Energy’s Wood Pellet Trade
Grumbar Energy, a biomass trading company, has been able to achieve rapid growth in revenue in the last 6 months by reviving an old business model with a touch of technology. They made over 500k Euro in half a year by focusing on a niche part of the supply chain, which is the B2B merchant that deals with raw materials, semi-finished products, or commodities.
The old-fashioned business model that allowed Grumbar Energy to grow quickly is called the modern Merchant model, which is the old Merchants model revised to today’s world. The modern Merchant model focuses on finding niche markets hidden in any part of the supply chain.
In the case of Grumbar Energy, they focused on the wood pellet trade. They found multiple niche markets in the supply chain, such as the wood trading market, the wood chips and sawdust markets, and the distribution market.
Grumbar Energy was able to penetrate these markets by being the single trusted seller in a rugged region of the world. They used technology to make the experience of running a distribution arm smoother.
The agglomeration stage and the distribution stage are the two main areas where a modern Merchant can find opportunities. The agglomeration stage is when a modern Merchant buys from multiple small suppliers to make one big lot that can be exported and bought by a large actor. The distribution stage is when a modern Merchant buys in bulk, stocks in a warehouse, and then resells it by pallets.
In conclusion, Grumbar Energy’s success in the wood pellet trade is a testament to the effectiveness of the modern Merchant model. By focusing on niche markets in the supply chain and using technology to streamline operations, Grumbar Energy was able to achieve significant revenue growth.
Learning From Failures: The Sawdust Incident
The speaker in the video emphasizes the importance of learning from failures in order to achieve success in business. He shares his own experience of starting a commodity trading company without knowledge of the modern merchant model, which resulted in complete failure. The speaker stresses that the modern merchant model is an old business model that has been revised for today’s world, and it has helped his company achieve rapid growth.
The modern merchant model focuses on a niche part of the supply chain, which can be a commodity, a product, or a quality that is not traded in huge volumes or a geography that is too complicated for large companies to invest in. The speaker believes that there are multiple niche markets in each supply chain, and the modern merchant model can tap into these markets and make a living.
The speaker gives an example of the wood pallet industry, where there are multiple niche markets such as the wood trading market, the wood chips and sawdust market, and the distribution market. He explains that the middle of the supply chain is often trusted by large actors that have a low cost of financing, and most of the opportunities can be found at the top or the bottom of the supply chain.
The speaker believes that the distribution stage is where the opportunity lies, and with a slight touch of technology and good management, it can be made smoother than it used to be. He also believes that the agglomeration stage, where multiple small suppliers are bought to make one big lot, can be a lucrative market if one can be the single trusted seller in a rugged region of the world.
The speaker stresses the importance of technology in modern merchant business and believes that it can help tremendously in managing the distribution arm and making the experience smoother. He also believes that the old baby boomers who run these companies are waiting for someone to clean them up and take over.
In conclusion, the speaker believes that learning from failures is essential in achieving success in business. The modern merchant model can tap into niche markets in each supply chain and make a living. With the help of technology, the distribution arm can be managed smoothly, and the agglomeration stage can be a lucrative market.
Agglomeration and Distribution Stages
The agglomeration stage refers to the process of buying from multiple small suppliers to create one large lot that can be exported and bought by a large actor. In the commodity/raw material world, it is often difficult for international companies to engage with a dozen small local suppliers to get the volume they need. Instead, they prefer to deal with one single seller who has checked the quality, provided traceability, ensured compliance with certifications, and more. Becoming this single trusted seller in a rugged region of the world can be a lucrative opportunity for small and medium firms.
On the other hand, the distribution stage involves buying in bulk, stocking in a warehouse, and then reselling by pallets. It is a pain to manage because of constant payment issues, logistic issues, bad weather, and the difficulty of finding good employees to work at a warehouse. However, with a slight touch of technology and the fact that everyone is glued to their smartphones, it is now possible to make the experience of running a distribution arm much smoother than it used to be.
The reality is that most of the opportunities in the middle of the supply chain are trusted by large actors that have a low cost of financing. Therefore, most of the opportunities that small and medium firms can find are at the top or the bottom of the supply chain, which we call the agglomeration stage or the distribution stage. A commodity niche market is a market that is too small or too complex for a large company to invest in but big enough for small and medium firms to make a living.
The modern Merchant model focuses on a niche part of the supply chain where there might be a hidden market waiting to be seized properly. It could be a niche market in terms of product, quality, geography, or a combination of all three. By tapping into these niche markets, small and medium firms can find success and growth opportunities.
Leveraging Technology for Growth
The modern Merchant model is an old business model that has been revived with a touch of technology. It focuses on a niche part of the supply chain, where there might be a hidden market waiting to be seized properly. This market could be a niche market in terms of product, quality, or geography. The modern Merchant model tips into those niche markets, which are too small or too complex for large companies to invest in but big enough for small and medium firms to make a living.
The middle of the supply chain is usually trusted by large actors that have a low cost of financing, so most of the opportunity is at the top or bottom of the supply chain, which is called the agglomeration stage or the distribution stage. The distribution stage in the commodity/raw material world is when you buy in bulk, stock in a warehouse, and then resell it by pallets. It’s challenging to manage because you have to deal with constant payment issues, logistic issues, bad customers, bad weather, and it’s very hard to find good employees to work at a warehouse.
However, with a slight touch of technology and the fact that everyone is glued to their iPhone, running a distribution arm can be smoother than it used to be. The old baby boomers that run usually those companies are just way too tired and are just waiting for a new generation to clean them up.
The agglomeration stage is when you buy from multiple small suppliers to make one big lot that can be exported and bought by a large actor. If you can be this single trusted seller in a rugged region of the world, you are going to make millions. Simple technology could help you tremendously.
In conclusion, leveraging technology can help grow a business by making the experience of running a distribution arm smoother and penetrating niche markets that are too small or too complex for large companies to invest in.
How to Penetrate Niche Markets
The modern Merchant model focuses on a niche part of the supply chain. In any supply chain, there might be a niche market hidden, waiting to be seized properly. The modern Merchant model tips into those niche markets. It could be a niche market in terms of product, if this is a product or a quality which is not traded in huge volume, or it could be a niche market in terms of geography, if this is a geography extremely complicated to do business with or a small geography that doesn’t really make sense for any giant to invest in. It could also be a combination of both.
A commodity niche market is a market that is too small or too complex for a large company to invest resources in but big enough for small and medium firms to make a living. The middle of the supply chain is often trusted by large actors that have a low cost of financing, so most of the opportunity that one is going to find are going to be at the top or at the bottom of the supply chain, which are called the agglomeration stage or the distribution stage.
The distribution stage in the commodity/raw material world is when one buys in bulk, stocks in a warehouse, and then resells it by pallets. Distribution is a pain to manage, as one has to deal with constant payment issues, logistic issues, bad customer service, bad weather, and it’s very hard to find good employees to work at a warehouse. However, with a slight touch of technology and the fact that everyone is glued to their iPhone, one can make the experience of running a distribution arm smoother than it used to be. This is where the opportunity is, as the old baby boomers that run those companies are just way too tired and are just waiting for someone to clean them up.
The agglomeration stage is when one buys from multiple small suppliers to make one big lot that can be exported and bought by a large actor. An international company that buys a 50,000 metric ton vessel load of anything won’t engage a dozen of small local suppliers to get the volume needed. They want to speak with one single seller that did the job of checking the quality, providing the traceability, making sure everything is coming compliant with whatever certification the local actor has, etc. If one can be this single trusted seller in a rugged region of the world, they are going to make millions. Simple technology could help tremendously in this regard.
To penetrate those markets, the modern Merchant knows one thing: they know that they need to focus on the niche markets and be the single trusted seller. They need to identify the niche market in terms of product or geography, and then focus on the agglomeration or distribution stage. With the right technology, they can streamline their operations and make the experience of running a distribution arm smoother.