Quote:
Originally posted by RANDY P
And on that note -
A lot of mfg's use that form of distribution to the general public for several reasons
1- sharing of costs with marketing
2- sharing of product liability
3- another way to guarantee return on production through contracts
4- allows multiple points of distribution - saving on costs, all the way around.
Another way of viewing a retailer is not as a vendor for a chosen item but more as a sophisticated marketing service. A manufacturer puts it there, and the salespeople / marketers expend the time and the energy to make guys like us all understand.
Believe me, I'm coming from a sales and marketing background. If there was a way that the manufacturers could eliminate retail and still make it profitable - they would.
rjp
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Randy,
Not trying to eliminate the retailer, as noted, just trying to point out that the mark up on resale is not justified. Professional marketing , give me a break.. just another avenue for the MBA's to justify 4 years of college in the art of resale profit greed.
I'm saying that a growing proportion of the business grads are in profit taking and at a unjustified level compared to the labor force. Education does not give licence to take advantage of people although I must admit, capitalism is based on it. A good example is the 7% commission realtors take on home sales. On a $200,000. home that's 14k for what ... paradeing a couple of people through and closeing. It's highly unlikely the guy's who actually built the home, taking months, made that kind of profit. It's not uncommon to see 50-100% markup on industrial parts just to cover "overhead". We can debate what is really nessary but when all things considered, the bulk of profit should go to those that created/crafted the product.
Tim