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---- Does drop shipping create mistrust with customers.
Propools - 9:04 pm on Aug 4, 2010 (gmt 0)Thread source:: http://www.webmasterworld.com/ecommerce/4182025.htm
A company who's business model is to promote a product line, attract customers, add industry/product value, etc. is not an MLM.
Why? Quite possibly, cost and shareholders return.
In our industry the model goes something like this:
1. Manufacturer makes the goods
2. Wholesale distributor purchases and inventories goods from the manufacturer
3. Dealer purchases and inventories goods from the Wholesaler
4. Consumer purchases and inventories goods from the Dealer
For the MLM fanatics, one could argue that the "Dealer" in Step 3 is participating in MLM. Wait.......for that fact, why not include the "wholesaler" in Step 2 also? Why not have ALL manufacturer's ship direct to the consumer?
Not all industries, manufacturers and products lend themselves to this type of direct nature due to the operating costs of servicing a direct business model. When you start ramping up the costs it generally means a decreased shareholder return. We know shareholders want good returns, so many manufacturers don't do this.
We are a "Dealer" or Step 3 from above.
We are primarily a construction company and we don't stock much.
Does this make us an MLM?
We also sell online.
Does this make us an MLM? Not Hardly.
Why do we have to stock something in order to be an expert on the product? Why do we have to promote the concept of drop-shipping when all the consumer wants is the lowest delivered cost?
The reality is that it's the delivered cost of products which really gets a consumers attention. Now, this is not to negate the value-add which some online companies add. Believe it or not, yes there is a lot of value-add which we bring to the table but that's a whole other discussion.
As far as promoting the concept of drop-shipping..........most consumers don't care.
Because I can get it and deliver it for less.
|Why should I order from someone who doesn't really 'have' it? |
Are you sure I haven't actually seen it? We actively install all the products we sell in the local market so that we're certain not to be shipping out product with a high failure rate.
|Why should I trust your product description if you've never actually 'seen' it? |
Just because I'm a few steps off the manufacturer does not mean that I'm not an expert.
|Why should I consider you an expert if you're just a middle man? |
Maybe because you either can't get the product direct or for less anywhere else?
|Why should I pay you to pass my order along to someone else? |
In answer to the thread. I don't think drop ship causes mistrust with the consumer when you're upfront about it. We are and it works to our advantage when we discuss the fact that we are in the business of installing the products we sell. The point of having a wholesaler or manufacturer drop ship then becomes mostly irrelevant.
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