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In yesterday's post we discussed how the Frito-Lay company (makers of potato chips and snacks) funds all the inventory for all their retail locations. The day before, we mentioned that giant retailer Wal Mart owns none of their inventory - instead they provide a marketplace for goods. In both examples - manufacturers are funding the inventory, the retailers are providing the marketplace. This, in contrast to today's high-end dealer who must do both. What if the high-end started thinking differently? What if we, the manufacturers and suppliers of high-end audio products, realized that retailers need us to be partners with them and bear some of the expenses? What would change? The model most manufacturers in our industry use is an old one. We each pay to market our own brands and products. The few retailers out there do the same - paying good money to bring people into their stores to buy our brands. This isn't working as well as we'd all like. What would happen if we pooled our resources together? Prospective retailers would pay rent, utilities and their own salary. Manufacturers would supply their inventory, available through a high-end buying group that would coordinate and make available the products. Marketing costs would be shared amongst the manufacturers, paid for by reducing our expenses on shows. We spend $150K a year going to trade shows. I am sure we're not alone. We see the same people, say the same things and see limited benefits. I would be happy to divert those funds to such an enterprise. I know this is a pipe dream. I know it's unlikely anyone will take notice. I know there are plenty of reasons it won't work. But, as my employees know, one of my pet peeves is for people to complain about something without offering an alternative. There. You have mine.
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Paul McGowan

Founder & CEO

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