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(The Year 2012 In Review)
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|User Info||More Black Friday And Final Demand; entered at 2009-12-04 20:04:21|
Registered: 2008-05-19 Caution: Congress at Work
My point is, I think I'm seeing a trend where manufacturers are undercutting their dealers severely
I've seen this over several years, accelerating more and more as online retailing took off and distributors/retailers relied more and more on manufacturers to keep their stock and do JIT fulfillment. Pretty soon, for many product lines, manufacturers (or major distributors/aggregators) figured they might as well go direct. Depending on the industry and product complexity, the market entry costs were relatively low, they were doing fairly low scale-fulfillment and instead of doing a net 30 and hassling with collections, they get money up front (less the 2% merchant card processing).
The way I see it, only two types of brick and mortar retailers will survive: huge discount stores and stores that have unique products or high-end service (especially valuable for more complex product purchases). You mid-range department stores (a la Boscov's or Bon Ton) are TOAST.