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Will 'showrooming' kill businesses? - Page 7

post #91 of 136
Quote:
Originally Posted by pocketsquareguy View Post

Unless you are the exclusive source of a product, don't bother building a web retail business these days unless you give free shipping and returns or charge a very low flat rate. But even a flat rate will limit your upside potential.

I'd say that about 3/4 of all the inbounds we get (vendors emailing us inquiring about advertising) are from brands or outfits that otherwise offer exclusive product. It's a very attractive business model - your margins are higher, and you can offer a good value proposition. The first is important to you, the second is very important to the customer.
post #92 of 136
Quote:
Originally Posted by pocketsquareguy View Post

Unless you are the exclusive source of a product, don't bother building a web retail business these days unless you give free shipping and returns or charge a very low flat rate. But even a flat rate will limit your upside potential.

It's a shame that first all the small locally owned b&m stores died, due to people wanting things cheaper and know the same conglomerates are killing the small e-tailers. At some point only a few people will make money on retail, as no one will be able to match their prices and shipping, as both get lower the more you buy.

The rich get....
post #93 of 136
Quote:
Originally Posted by Find Finn View Post

I was wondering regarding f.ex. cars, as people around here are complaining that main dealer showrooms are to big and expensive, so if they closed down and you could only buy a brand new car via their website, would you?
I have been looking a used MB's and BMW's lately and some of the dealers 100-500km away offer to ship the car to you, which means you buy a car from a picture without test driving it etc.

Used Mercs and BMWs are rather common cars, so I see no need take the risk. I'd have a hard time buying a car online UNLESS it was something so uncommon that I highly desired, say a Citroen DS. Then I'd still make the effort to drive up to a few hours to kick the tires. It would be a bit more comforting to purchase from dealer than individual, especially with a guarantee. Do an online VIN check too. I'd certainly have an independent, objective mechanic give it a very good going over, and that can be arranged online. What does one test drive really tell ya? Not much really if you're not a petrolhead.

As I think about it for new cars I think most people don't buy from the lot. They visit the showroom, test drive a few models, haggle, and their new car arrives a few month later. Yet new car showrooms in the States and Middle East are massive. Why? In Asia they're often the size of a green grocer; two or three models to view, place your order, and wait.
post #94 of 136
Quote:
Originally Posted by curzon View Post

Used Mercs and BMWs are rather common cars, so I see no need take the risk. I'd have a hard time buying a car online UNLESS it was something so uncommon that I highly desired, say a Citroen DS. Then I'd still make the effort to drive up to a few hours to kick the tires. It would be a bit more comforting to purchase from dealer than individual, especially with a guarantee. Do an online VIN check too. I'd certainly have an independent, objective mechanic give it a very good going over, and that can be arranged online. What does one test drive really tell ya? Not much really if you're not a petrolhead.
As I think about it for new cars I think most people don't buy from the lot. They visit the showroom, test drive a few models, haggle, and their new car arrives a few month later. Yet new car showrooms in the States and Middle East are massive. Why? In Asia they're often the size of a green grocer; two or three models to view, place your order, and wait.

What if you couldn't do this only online, the european dealers are marble floored glass houses with designer furniture.


I'm looking a fully loaded 11-12 535d / 350cdi etc. so they are not as common as older models, also we are talking 100k$< and if you want a certain color etc. it's not likely they are parked down around the corner.

Vintage cars are something different.
post #95 of 136
Quote:
Originally Posted by Find Finn View Post


What if you couldn't do this only online, the european dealers are marble floored glass houses with designer furniture.
I'm looking a fully loaded 11-12 535d / 350cdi etc. so they are not as common as older models, also we are talking 100k$< and if you want a certain color etc. it's not likely they are parked down around the corner.
Vintage cars are something different.

 

It's not too hard bad what I've seen.

 

Pull up a car cost invoice, find out the cost. E-mail dealers saying, "I want to buy this car at X price (cost + Y%, Y being their profit margin)".

 

Eventually they'll reply and maybe accept, the longer a car sits on the lot, the worse it becomes (hey it's like clothing! Minus certain classic).

 

Obviously ordering from the factory would mean less room to negotiate.

post #96 of 136
American car buyers are accustomed nowadays to on-lot stock, a few still order and wait, but many (who you never hear from again but see driving around town) just buy whatever is on the lot in the right color at buying time. Asian buyers sympathize with the lack of real estate for a lot and surrender to the fact that they'll be ordering the exact car they want and get it 3 months later, without haggling, the price is the price.
post #97 of 136
Quote:
Originally Posted by Find Finn View Post

It's a shame that first all the small locally owned b&m stores died, due to people wanting things cheaper and know the same conglomerates are killing the small e-tailers. At some point only a few people will make money on retail, as no one will be able to match their prices and shipping, as both get lower the more you buy.
The rich get....

I think that this is nostalgia, not reality, talking. The truth is that a lot of locally owned B&M stores died because they sucked. They relied on customer ignorance and lack of alternatives to survive. Good local B&Ms that were able to adapt, to offer things that large stores and e-tailers could not, survived and even thrive. The town in which I live have some good examples of both. The local video store is actually doing well, despite netflix, streaming, etc... First of all, you can browse a very good selection of unusual films, in person, which is huge for movies. It keeps people coming in. Second, prices are competitive, and they offer incentives on older movies, like 5 for $5 on Fridays, and 2 for one rentals on Tuesdays, that make them competitive with netflixs, streaming, and Redboxes. Also, customer service is exemplary. All the SAs are knowledgeable and friendly. They will even waive the occasional late fee if you are a regular customer.

Our local appliance store offers similar, terrific service, and a price match guarantee, as well as free, same day shipping and installation. And cheap repair fees for appliances bought there. I have bought everything from them.

I could keep on going. There are ways that small B&Ms can compete.
post #98 of 136
I've been thinking a lot about this over the past few days -- I daydream often about opening a boutique here in Montréal, so I find the consensus a bit disheartening. I also think it's largely incorrect.

I read this article the other day about how Amazon is setting up distribution networks in major cities to offer same day delivery: http://www.slate.com/articles/business/small_business/2012/07/amazon_same_day_delivery_how_the_e_commerce_giant_will_destroy_local_retail_.html

For high commodity items like computers/electronics, books, simple tools, etc., yes, Amazon is coming to eat your lunch. At this point I would be working on an exit strategy. However, for items that aren't highly commoditized, this isn't such a huge danger. I don't see how in the foreseeable future, Amazon is going to take over fashion retail.

The issue of coolness is certainly a valid one. Buying from a place like LN-CC or whatever is satisfying in its own way, even if the interaction it as at a shallow web-only level. But what I think is more important is that most mid-to-high-end labels don't produce a high enough quantity of each item for such a strategy to be applicable. Especially if you are carrying labels that don't have a very high level of distribution, you can probably rest easy knowing that Amazon is not about to start selling obscure Japanese designers by the truckload.
post #99 of 136

oh shit, same day delivery?  me wants.

post #100 of 136

It's the trade off in exchange for collecting sales tax. 

post #101 of 136
Quote:
Originally Posted by brad-t View Post

I've been thinking a lot about this over the past few days -- I daydream often about opening a boutique here in Montréal, so I find the consensus a bit disheartening. I also think it's largely incorrect.
I read this article the other day about how Amazon is setting up distribution networks in major cities to offer same day delivery: http://www.slate.com/articles/business/small_business/2012/07/amazon_same_day_delivery_how_the_e_commerce_giant_will_destroy_local_retail_.html
For high commodity items like computers/electronics, books, simple tools, etc., yes, Amazon is coming to eat your lunch. At this point I would be working on an exit strategy. However, for items that aren't highly commoditized, this isn't such a huge danger. I don't see how in the foreseeable future, Amazon is going to take over fashion retail.
The issue of coolness is certainly a valid one. Buying from a place like LN-CC or whatever is satisfying in its own way, even if the interaction it as at a shallow web-only level. But what I think is more important is that most mid-to-high-end labels don't produce a high enough quantity of each item for such a strategy to be applicable. Especially if you are carrying labels that don't have a very high level of distribution, you can probably rest easy knowing that Amazon is not about to start selling obscure Japanese designers by the truckload.

You're wrong but I can't prove it right now. Giants like Amazon will be omnipotent and stores like LN-CC will loose their cool if not already
post #102 of 136
There isn't enough volume and revenue in those brands for Amazon to be bothered.
post #103 of 136
Quote:
Originally Posted by London View Post

There isn't enough volume and revenue in those brands for Amazon to be bothered.

Completely untrue and not indicative of their past history in other categories.

post #104 of 136
You guys are thinking too short-term and too niche

As a business model you would fail miserably if you think you can use the same short-term model, targeting a niche market.

Amazon will look for market opportunity and they have the scale to do so. It does not matter if 'XYZ' is niche. Have you not seen "Used/Like New" listed on Amazon before? Exactly.

There is an actual market outside of Forum B&S
post #105 of 136
Quote:
Originally Posted by gettoasty View Post

You're wrong but I can't prove it right now. Giants like Amazon will be omnipotent and stores like LN-CC will loose their cool if not already

Oh. OK.
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