Question About AE Operations, Costs, and Commissions

[Francisco D'Anconia]

The backstory:

Last month I was in an AE store. While talking to the manager who was seeing to me and lamenting the recession's effect on both of our sales, we came on the idea that might benefit both of us. The idea is for AE's sales force to hold a sales event at my office using one of our conference rooms for temporary displays and fittings. It's become more than just an idea and it looks like the event may happen next month.

We also talked preliminarily about compensation from AE for arranging the event. We focused on store credit/AE goods (e.g., shoes) as payment in kind from AE (I'd probably just wind-up spending the cash on shoes anyway). But we've not yet talked about structuring the credits.

The question:

I'd like to maximize credit, but I don't want to ask for too much either; pigs get fat - hogs get slaughtered. So I'd like to solicit suggestions from you gentlemen on what to propose. I don't want to just pull something out of the air, so suggestions based on the following data would be especially welcome:

* AE's actual, or average cost, on a pair of calf dress shoes - paying a commission in kind out of inventory seems like a cost effective way of penetrating new markets, especially compared to paying in cash.​

* The size and composition of AE sales force commissions. I'm assuming that whatever goes to me gets deducted from the regular sales force's commission, at least in part. I don't want to be seen digging too deep into their rice bowl so to speak.​

Thanks!

 

[lee_44106]

so let me clarify,

So the manager of an Allen Edmonds store has agreed to display and sell, at a discount over retail, AE shoes at your office?

So who would be the potential buyers? your co-workers?

What is it about displaying AE shoes at YOUR office versus the actual AE store itself that makes it more likely for people to buy the shoes? Why couldn't the manager of the shoe store just offer the same discounts at HIS store?

 

[Smahatma]

Originally Posted by lee_44106

What is it about displaying AE shoes at YOUR office versus the actual AE store itself that makes it more likely for people to buy the shoes?
I would tell everyone in the office that it's a fundraiser for my daughter's girl scout troup.

 

[indy116]

Originally Posted by lee_44106

What is it about displaying AE shoes at YOUR office versus the actual AE store itself that makes it more likely for people to buy the shoes? Why couldn't the manager of the shoe store just offer the same discounts at HIS store?

Maybe introduce people to the brand at the office, and negotiate some sort of corporate discount at the store? I can't imagine that people unfamiliar with the brand will be too keen on plopping down $300 for a pair of shoes the first time they see them.

 

[Francisco D'Anconia]

An in-office event will offer a discount to attract new purshasers.