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275647 Posts in 27717 Topics by 4283 Members Latest Member: - otto Most online today: 65 - most online ever: 429 (November 03, 2007, 04:35:43 AM)
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Author Topic: Channel conflict with distribution-retailers-manfacturers  (Read 6984 times)
Ryan Ary
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Posts: 26


« Reply #15 on: December 25, 2001, 03:06:00 AM »

It seems to me that the best option (though least likely to occur in the real world) for the manufacturers (my end of the channel) would be to collectivize low unit count orders and direct sell high count orders as established by the individual manufacturer.

The question would be could the collective "distributer" stay solvent taking only the dregs of the orders. Additionally, each manufacturer would have to be able to handle the distribution responsibilities for their large orders.

I would think that one way to mollify the first problem would be to help those manufactures that couldn't deal with the second. For example, the NON-PROFIT collective "distributer" works on standard terms (60-40%) for typical low end orders then also carries high unit count orders for manufacturers that can't afford or are unwilling to self-distribute. However, the high count orders are handled at say 55-45% (just as a top of the head figure). Thus, the collective stays in the black and can pay a full-time staff but manufacturers would would get more of the profits from their work. At least then the artistic sucesses could break even and maybe make a few bucks, writers and artists might get paid what they are worth, etc.

The real key to making the system work would be to get most manufacturers to participate and therefore force retailers to use the collective. I suspect a good deal of web enhancement would also be necessary to keep cost low and auto-direct large unit orders to the manufacturers internal distribution channel. (Again in a perfect world the web-ware for the process from start to finish would be provided to new client manufacturers when they sign up so the system is seamless.)

Most importantly, the collective distributer would have to be very limited with regard to making or using profit. Again ideally, an annual (sp?) raise could be provided for staff and some percentage for capital improvements would have to be paid. Other profits would either not be collected in the first place by reducing the distributer percentage on sales up front or would be returned to the manufacturers at the end of each quarter in the form of a check based on their contribution to sales volume.  

I know its dreamy and the "disributers-that-be" would do all they could to dismantle any effort made to make it happen but that, it seems to me, would be the best way to streamline the channel for maximum profit. One would think that GAMA might have filled this role but then with distributers in a manufacturers association I guess that rather unlikely. ;-P

Ryan
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Former, Co-Founder, Thunderhead Games, Inc.
Former, Vice Chairman, DnDCC/FaNCC
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