Hi guys I'm back with some questions. This thread is an offshoot of a very old one by @biophase : https://www.thefastlaneforum.com/co...s-or-is-it-just-bad-business.7035/#post-23298
The question is quite similar to the one raised by @biophase. His premise was different in the sense that he wanted to know why wholesalers/manufacturers would sell direct to the consumer and not maintain their B2B function to which @MJ DeMarco replied:
"What you're experiencing is the ability of manufacturers to now directly sell to the consumer via the internet. Without the internet, this would not happen. The web is destroying the middleman and allowing manufacturers to go directly to the consumer. This is one of the many things the internet will ultimately destroy behind stockbrokers and travel agents ... you might not like it, but the manufacturer loves it and the consumers get the best price. Being a distributor is a fastlane passenger arrangement while the manufacturer is the driver ... its all about control."
What I want to know though is what are you supposed to do when you see manufacturers selling directly online from the get go or once you have set up an arrangement - with them and they see how much business you have generated for them - that they decide to undercut you completely and go direct to the consumer?
What do you do from the beginning to account for this or prevent this from happening? MJ, when you are bootstrapping something and have no other way to begin but as a middleman - what do you do?
If you look at starting a business and select a business you would like to go into - this issue would and probably does occur with majority of businesses - by a process of elimination - if you was to boil down to a model where this may not occur - you wouldn't be left with many choices for businesses to go into would you?
I may be wrong. Please can you guys shed Light on this for me? @zend***phin @MJ DeMarco @biophase @JackEdwards @RichKid etc etc and any other legend that can share their wisdom.
The question is quite similar to the one raised by @biophase. His premise was different in the sense that he wanted to know why wholesalers/manufacturers would sell direct to the consumer and not maintain their B2B function to which @MJ DeMarco replied:
"What you're experiencing is the ability of manufacturers to now directly sell to the consumer via the internet. Without the internet, this would not happen. The web is destroying the middleman and allowing manufacturers to go directly to the consumer. This is one of the many things the internet will ultimately destroy behind stockbrokers and travel agents ... you might not like it, but the manufacturer loves it and the consumers get the best price. Being a distributor is a fastlane passenger arrangement while the manufacturer is the driver ... its all about control."
What I want to know though is what are you supposed to do when you see manufacturers selling directly online from the get go or once you have set up an arrangement - with them and they see how much business you have generated for them - that they decide to undercut you completely and go direct to the consumer?
What do you do from the beginning to account for this or prevent this from happening? MJ, when you are bootstrapping something and have no other way to begin but as a middleman - what do you do?
If you look at starting a business and select a business you would like to go into - this issue would and probably does occur with majority of businesses - by a process of elimination - if you was to boil down to a model where this may not occur - you wouldn't be left with many choices for businesses to go into would you?
I may be wrong. Please can you guys shed Light on this for me? @zend***phin @MJ DeMarco @biophase @JackEdwards @RichKid etc etc and any other legend that can share their wisdom.
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