Lancer7676@aol.com wrote:
>
> In a message dated 9/6/98 2:21:37 PM Eastern Daylight Time, GMari58175@aol.com
> writes:
>
> << the big box
> retailers are a significant detriment to the local economy, enviornment and
> general well being of the area. >>
>
> I agree with this. Wal-mart, Home Depot, and Lowes are very destructive to
> local economies. I agree with my old Dad when he remarked one day that they
> should eliminate quantity discounts.
Speaking as somebody who makes a product, this would
be unworkable.
For background, one of my companies products is CD-ROMs, like
computer software.
I simply cannot sell it in onesies and twosies for the same $11
I will sell it by the thousands to a distributor. I just can't
survive that way.
The reason is simple, it's no less work for me to sell 10 copies
as it is to sell 10,000 copies. I have to track the order, answer
some questions, arrange shipping, make sure it gets there, and
answer any questions they have.
If I am selling 10,000 units I can sell at $11/unit because I'm
making enough to be worth my time. If I'm selling 5 units at
$11/unit it won't even pay for the long distance calls to make
it happen. I have to charge $20/unit and double my profit margin
or else it's just a waste of my time.
Another problem with dealing in small quantities to small
retailers is that there is no future. I can't take a loss
and sell them 5 cheap, because even if they get wildly "hooked"
it'll never pay off because the most I'll ever sell through
them might be a few dozen.
For somebody who can move quantities, I can even take a loss
and sell them 1000 cheaply because if they like it I can move
6 digits to them the next month.
I could hire 100 sales staff and have them call all over
the country to every mom and pop computer store, and they
might sell 1000 units a week. Or I can spend friday afternoons
myself calling the big guns and move the same quantities.
Shedding a tear for the Mom and Pop business is, to me, like
shedding a tear for the horse and buggy. They are quaint and
on one level it is very sad. But on a practical level, the world
is just moving in another direction and that is life.
--
Trevor Boicey, Ottawa, Canada.
tboicey@brit.ca, ICQ #17432933
http://www.brit.ca/~tboicey/
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