On Thu, 2003-09-18 at 15:57, Wolfgang Bornath wrote:
> ed tharp schrieb am 18 Sep 2003 18:12:32 -0400:
>
> > On Thu, 2003-09-18 at 07:25, Wolfgang Bornath wrote:
> > >
> > > Being presented at exhibitions, distributing boxes overseas (USA,
> > > Canada, Australia) is a costly venture which is right now just not
> > > paying back.
> > >
> > Here's the thing, as I see it,,, since the three disks set is GPL,
> > really there is only a couple of things needed, 1. some one to press
> > the CDs, print the boxes and some instructions (ala cheepbytes) a
> > logistics/distribution service, and the contacts able to make the sale
> > to to the big three, then some one else to handle "all the other"
> > retail in the USA.
>
> That's what I said with "... is a costly venture ..."
>
> We are not really talking about the production of the boxes, that's
> still done for each version. We are talking about the cost of
> distribution via stores. There's too much loss of revenue compared to
> purchases at MandrakeStore. I don't know how much a MandrakeStore order
> brings more revenue than a sold box from a shelve in Dayton, Ohio, but
> there is a remarkable diff. And after software sales went down in
> general this diff made the difference between doing and not doing.
>
> wobo
Thank god most companies don't take this attitude... Sorry if I sound
less than complimentary here don't mean to. But the cost per box of
shipping 1 to a person is higher than shipping 10000 to Walmart or a
similar organizations Central warehouse. In both case the cost of
shipping is born by the recipient not the sender. So it doesn't matter
if it's one or ten thousand. The cost per box is identical in shipping
but not in handling. Which is born by MDK.
The real difference is that at say 40 US dollars a box Mandrake gets 40
dollars. But on a boxed set to Walmart they only get 15 dollars. Then
Walmart adds 3 dollars shipping to initial wharehouse. 2 dollars cost
for redistribution. 3 dollars cost in receiving handling. 2 dollars
more in local handling (the shelf stocker at the store.) Plus 4 dollars
in redistribution costs. (sending it out to the individual stores
involves re-packing etc.) 1 dollar in inventory control costs, and
finally 5 dollars in inventory tax, damaged and nonreturnable product,
theft, etc. The end result is about 6 dollars a box clear for Walmart.
or 60K pre-tax, profit.
Now on the MDK end. Their cost is about 7 dollars per box set for
box... CD's artwork, printing, handling, loss, etc. Plus about 1 dollar
per box for inventory returns. End result 7 dollars per box set or 70k
dollars for every 10k sold.
Now in a direct sales situation the cost per box set does , as well as
the total volume does a nosedive. (Less exposure always means decreased
sales. period. Anyone who says otherwise needs to go to work for
Ovaltine.) (note: Ovaltine was the #1 chocolate Milk powder in the US
with about 80% market share at one time. So they decided to stop
advertising, and cut sales staff. product line eventually died.) So
they would sell say only 1 thousand boxes. Ok with the increased costs
(lots of individual orders mean more people etc to handle it.) so costs
there are probably closer to 15 to 20 dollars a box. Let's drop that
down to 15 and note that it leaves 25 dollars per box clear. or 25k
profit or another way to look is that they lost 45k over what they could
have had.
Now yes the sales numbers are small (they better be) One Fry's near
me does 300 RH boxes a month on average (insider knowledge here.) or
3600 a year. They aren't the top store either. Times the 20 stores
they have, that's 72000 boxes a year. So a Walmart would order a lot
more boxes than 10000.
just some food for thought. ( I spent toooooooo much time in logistics
the last 20 years. *sigh*)
Want to buy your Pack or Services from MandrakeSoft?
Go to http://www.mandrakestore.com
