So do you think this is a good idea or bad?

[Nickerz]

Well I was thinking the other day why not exchange traffic with basically an indirect competitor. I sell parts online... what kind ill be kinda vague for. But there is a "competitor" that sells the parts used... and used only. The competitor's service works like an online action site. As a NEW product retail store im wondering if its a good or bad idea to network with their traffic.

Positives
-Customers toying around with idea of used may consider new products.
-More traffic... more leads!
-Affiliate income?
Negetives
-Customers interested in new may decide to go used.

[Morgenhund]

Well.. what happens, if you decide later to go on selling used parts, and your competitor -- new ones? Would you sue him? Otherwise?

IMHO the idea is not neccessary bad, but risky. I'd try to find something still relevant to your parts (like coffe/chocolate relations), but not so closely related.

[internetpilot]

It also depends on what these parts are for. For example, you're selling new computer parts and he's selling used ones, most of the people going online to find their own replacement parts are pretty savvy and looking for the cheapest method of repairing their own computer. That would mean that most of them are going to go for used parts, especially if there is a significant price difference between used and new.

Now, if you're selling Porshe automotive parts, chances are that most Porshe owners are going to want new for their driveway pride and joy.

[MrFishGuy]

I'd also be afraid of my reputation being hurt if the company I'm "partnering" with is a poorly run company.

If someone had a bad experience with the other company and got to them through my site, that may hurt my reputation.

[gorgmd]

Thatīs the same thing I thought, too. The service question is a really difficult one.

I could imagine, that you both could create affiliate programs, that give each of you a percentage of the sales referred to by the other. So you (and your competitor of course, too) would still participate from the turnovers generated by the referral and you would additionally generate more sales, as money-saver customers would buy as well as people that are uncomfortable with buying second-hand. This way you increase the longterm interest of each partner to share the traffic. A customers that switches from NEW-to-USED or vice versa still generates money.

By exchanging the affiliate percentage of your referred sales with your competitor you both reduce the risk that one of you is generating significantly more than the other from this partnership.

The advantage of this partnership would be that both of you would participate from the traffic the other creates. On the other hand you could also simply add second-hand products to your lineup you buy from your competitor and sell without a warranty. This way you (and he, too) could make sales to second-hand customers of your traffic stream, but you are losing the "I-buy-only-new" customers of his traffic stream.

In this scenario you would have control over the service you provide, but it would probably either be

a)very much administration work for you (exchanging stock lists along with condition of items, updating them as soon he makes sales etc.) or

b)worse than the service he could provide.

How important is the warranty aspect with your products? Are they higher or lower priced? Industrial or consumer products?