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Speaker Asylum General speaker questions for audio and home theater. |
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In Reply to: Fun Manufacturer's Cost Questions... posted by truthseeker on March 22, 2000 at 10:11:03:
>>>and eliminates dealers, distributors, and most advertising costs, what do ya think he should charge for his products? Should he give the entire benefit to the consumer? Or should he split the difference?<<<<Once a manufacturer decides to sell direct, he/she incurs some additional costs. The biggest one is the time/expense of dealing directly with the individual consumer. Advertising or marketing costs continue, they may just be directed differently. On the other hand, some of the costs of working with dealers can be reduced: trade shows can be eliminated, travel and dealer promotion can be eliminated, don't have the cost of dealers who are slow pays or no pays.
It seems that the costs comes out about even, which is why you will typically see a direct marketed product selling for around 1/2 the price of a dealer marketed product.
Mike Dzurko for ACI
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- Re: Fun Manufacturer's Cost Questions... - Mike Dzurko 13:39:46 03/23/00 (0)
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