What would justify switching to Affiliate Programs?

[Steelbank]

We have been operating a major online store that targets a niche market for about 3 years. Our store is very popular and we have a significant amount of sales every day.
One of our major challenges has been stocking items we offer for sale. This has not only limited our inventory selection due to lack of capitol, but also has left some of our customers looking for items in sizes we no longer carry.

Our site gets about 2,000 unique visitors per day. Most recently, we have had problems with returned items and disgruntled customers due to the quality of items (these are major brand name products and have nothing to do with us).

Since this was a spin-off of another project, I found that most of our employees now spend more time on solving problems and accepting returns than marketing/sales. It was recently suggested to me that we give way to the current business model and implement an affiliate program. There are many major programs out there. This wil not only automate the site, but we can increase our selection x100 from what we have now.

Any thoughts?

[TrustNo1]

First fix the returned items and disgruntled customers problem before even thinking about starting an affiliate program.

[Steelbank]

I apologize for my original post - I certainly wasn't clear enough. What were were thinking is getting rid of our entire inventory and shopping-cart system and implementing/registering with an affiliate/competitor and let them deal with the headaches and focus on the core of our business.

[LifeinAsia]

If I understand correctly, instead of buying directly from the supplier and selling directly to the consumer, you want to basically promote a (former) competitor and let them handle everything, giving you a small cut. Correct?

That may work in the short term, but long term you will probably find that most of your customers will end up going directly to your former competitor instead of you.

Since it's a spin-off and not your main business, then it may make sense to do that. But expect that you will probably see decreasing sales from this. That's my take anyway.

[solly]

I had a similar problem: dealing with shipping and customer service issues were driving us crazy! I thought about what you are talking about, creating an affiliate site instead of a direct sale one.

But, the question is, can you take the pay cut? When I looked into what it would take to equal the income, I found there was no way. YMMV.

Have you considered an outright sale? That is what happened in my case...