Comments on: Shopatron redefines Vendor Relationships

By: joeandrieu.com » Blog Archive » Jeremy Zawodny joins VRM (perhaps unknowingly)

Sun, 03 Jun 2007 09:55:12 +0000

[...] VRM personal RFP. From my view it is one of the “low hanging fruits” of the VRM world. Shopatron has already demonstrated a viable approach for turning confirmed orders over to a streamlined [...]

By: Joe

Joe — Fri, 25 May 2007 19:36:53 +0000

That’s an interesting perspective. However, I find it hard to believe that the majority of manufacturers actually have a realistic option to build out their own retail channel. Only the largest manufacturers in the most accessible markets can do that: Levi’s, Coca-Cola, Nike, Bose. There simply isn’t room for everyone to do it.

In contrast, Shopatron delivers high margin confirmed orders to retailers at virtually no risk. It brings new customers in, moves product through the store, and gives retailers a nation-wide look at sales trends. I think these benefits far outweigh the potential threat you fear. The only ones who lose in this scenario are the 100% pure online merchants who were already disintermediating local retailers.

It is inevitable that manufacturers build closer ties with their ultimate customers. The Internet practically demands it. Retailers can either find a way to create value in this networked world or find themselves sidelined in the inexorable march of history. Shopatron keeps retailers relevant. Complaining about the erosion of a monopolistic channel and heralding doom for those willing to reinvent themselves, doesn’t.

By: retailerconsultant

retailerconsultant — Fri, 25 May 2007 18:29:37 +0000

I respect your perspective but having worked in other Channel Driven industries I would like to post a warning to all retailers – supporting ShopAtron is the same as paying the expenses for your vendors to eliminate the need for your services. They NEED you now – it would cost them millions to set up “distribution centers” across the country – but by forcing YOU to carry inventory in order to participate in this program they do not have to worry! Then … guess what, once they have built their business large enough they can start opening their OWN retail shops in the areas where they get the most sales. By participating in ShopATron’s program YOU ARE PROVIDING THEM EVERYTHING THEY NEED TO DECIDE WHERE TO BUILD THEIR OWN RETAIL OUTLETS and they get to make money on you while you do it!

I was part of a large company that became a large company by selling through “partners” across the US. It was great fun, our partners made money, we made money, everyone was happy …. for about 3 years. At 3 years the marketing department said “we’ve hit the magic number, it would be more cost effective now to sell direct to our customers” And they started the “retail division”. That was the beginning of the end of their distribution channels. Our CEO used to brag in meetings “this was great! all of these people built our business – our investors love it!” “But now we don’t need them, yeah, I know they’re pissed off but look how much more profit WE are making!”.

I would encourage retailers to think long and hard about supporting a program like ShopAtron – it is the beginning of the end of the middle market.