Direct OEM sales not always best for the OEM

[Angel Barracks]

I was chatting the other day to a fellow trader and we were talking about re-selling.
That being the selling of another company’s product via your own shop.

I see quite a number of posts online, along the lines of; I will always go direct rather than through the reseller, to support the manufacturer.
However that is not always the best way to support them…

Back when I was a reseller I had lots of different companies products.
I always kept a decent stock level so I could ship the next day and keep the customers happy.
This meant placing orders with the numerous suppliers each time stock of an item got low.

So let us use Bobs Minis as an example.
If I got an order from a customer that meant some of my stock of BM needed topping up I would place an order with BM to keep my stock levels healthy.

Let us assume that the customer spent £25.00 with me.
Let us also assume the customer bought a selection of items that left a shortfall across 5 BM lines.
I need to replace these 5 lines.
The trade value of these 5 lines may only be £10.00.
However BM has a minimum order value of £250.00, so I can’t simply send BM an order for £10.00.
I have to send BM a £250.00 order.

So for my £25.00 sale of BM products, of which I need to replace £10.00 worth, I place an order with BM for £250.00.
That is much better for BM than had the customer gone and spent their £25.00 direct.

Apologies if you knew this already.
Just wanted to share.

[Norm S]

Although, over the long term cycle, things should balance out, with the end result that you might hold say £1000 of BM stock and roughly maintain that and not need to re-order anything for say the next 10 sales.

I am quite happy to spend with a re-seller, I tend to think that I am actually supporting two businesses. I am not that keen on kickstart or p500 systems as the manufacturer gets a LOT of the cream and the re-sellers, which are a good support mechanism to the manufacturer, take a slice of what is left falling from the table of goodness.

In the boardgame industry, I have seen a manufacturer launch a game and gain from the initial pre-orders, then they gain sales from all the distributors and having done that in short notice they announce a fire sale …. before the distributors have even had a chance to move their stock on. That just seems plain bad form.

I order my Kallistra and Pendraken figures from Kallistra and Pendraken as they are both manufacturer and distribution in the UK. But I have recently bought 4 boxes of Perry 28mm plastics and they have all come from local shops rather than directly from Perry. Likewise I have a bit of 1/72 kit from the Plastic Soldier Company, but I have never bought direct from them, other than once at the York wargame show. Though the shops like yourself have quite a bit of money tied up in shelf stock …. which they hope they can shift.

On balance, I tend to support bricks and mortar outfits whenever I can (bought 4 bags of flock today from a model shop).

 

 

 

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