I am investigating setting up a website in the United Kingdom selling
PDA's (Personal Digital Assistants) i.e. Palm Pilots, Compaq IPAQ etc.
 Most of these companies supply through wholesale distributors like
Computer 2000 http://www.computer2000.co.uk/ or Ingram Micro
http://uk.ingrammicro.com/corporate/corporate.jsp

My question is how much of a discount off the full Recommended Retail
Price can I expect to get from these distributors on PDA's in the UK
(presumably dependant on the order quantity) and what sort of mark-up
do the large UK electronics goods retailers achieve on these items
with their ability to buy in large quantities, presumably direct from
the manufacturers.

i.e. As a small fish (even with low overheads) am I going to be able
to compete with the bulk buyers and still make a reasonable profit.

I can't comment specifically regarding the UK situation, but I have
worked in computer retail here in Canada for several years now, with
the largest chain of computer stores in the country. Average margin on
pocket PCs is around 7 to 9 points. On Palms it ranges from 5 to 12
points.

You have to hope to sell accessories (adapters, cables, memory,
software, warranties, etc.)

in order to make much.