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Originally Posted by xenigo
I didn't think there would be so much confusion surrounding this request for advice.
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Worthwhile advise comes from informed advisors, thats why all the questions. The profit participation sounds reasonable to me, provided you know what his markup and true costs are. Have you figured out the cost of order fulfillment and who bears that? If the margins are too tight on this type of product line then the 40% might not be worth it for one or even both of you.