Originally posted by: Arkitech
Originally posted by: NeoV
I've been to the last 6 E3's, and I'm already registered, for free, for this year's show!
Tough business to get into with the size of the competition (Best Buy, C.City, etc)...still, going to be a ton of HDTV sales over the next few years
I love mine!
yeah I'm finding that out. I don't really understand why manufactureres would'nt want smaller businesses to carry their products, in the end it only helps them make more money.
Not necessarily.
Manufacturers want to keep a certain gross margins and don't like it when resellers start price competition. I would say it might be difficult for you to be a reseller because you will not get the same pricing as a large chain. Also, undercutting on prices will attract the attention of the manufacturers.
Here is a letter from a reseller of Zenith products that was sent out to its customers:
Dear valued customer,
We are writing this letter to you today to explain events that have taken place over the last week and new information that has come to our attention with regards to LG and Zenith and their problems with product, availability and company policy.
Our management team has found out some very disturbing issues about this company and are meeting with LG executives now to determine what can be done for Gochnauer's and our valued customers. We ask for your patience until a final decision is reached this weekend. We will then send all our customers a response monday afternoon upon their return from these meetings. We have come to find out some issues with the LG corporation and I have listed them below so you know what we are up against. These issues are very serious in nature and will not be tolerated by Gochnauer's in any way as they prohibit fair trade and hurt you the customer in the end. Gochnauer's first priority is to give our customers the best quality product at the best value possible in this fine country and all of our vendors share this belief with us when they come on board and make their product available to our customers. These manufacturers know what we expect from them and what they will get in return. We expect the finest quality product to be made and distributed to our people. We expect this product to be available when we need it or within a reasonable time frame. We also expect to be able to sell this product at a free market special discounted price to our customers. We do not believe in selling items at retail or keeping special allowances given to our company from the manufacturers when we sell their product. Every dollar that this firm gets on a model from the manufacturer goes right into the price of the product to give our customers the best deal possible. This is the belief that has made us grow and given you a fine purchase price on the product you are waiting for now. We will never change our demands or beliefs for any vendor. We can give these vendors a great amount of sales from the finest customers in America for just working with us to give you a great price on the very best product. The below list is very disturbing to us and you need to be made aware of what is happening. We had only found out about these issues last night and are now passing it along to you. I have added some extra comments at the bottom of this e-mail and what you might be able to do to help.
1) The first main issue for many of you is the DVB318 situation. We have been told all along from executives at LG that the new units coming into us would have old firmware and upconvert via component outputs just like the old 318's did. We have asked them over and over to confirm this and all has been reassured to us that this will be the case. We have now learned from an inside source at the factory that these people have lied to us and the new units will not do this. Our source believes LG has a boatload of these units arriving and wants to just get them distributed in any way possible and will say anything to have this happen. This is an extremely wrong thing to do and Gochnauer's will not tolerate that kind of action at all. We have sold these units to you in good faith and with the belief that they will all upconvert the same as the old unit. Since this appears to not be the case now, we would cancel all orders from them and make our customers and others aware of this issue. Our management team is now in meetings with LG to get a written and signed statement that these units will do what we were initially told. If they will not do this for us, we will be canceling all orders for this product. I will post you monday afternoon as to the outcome of these talks and what might happen from there. You have been so patient for so long now, I just ask for another few days until monday afternoon to get you the real facts. Gochnauer's would rather lose your sale then lose your trust and sell you a product knowing it will not do what we said it would. That is bad business and we will not be like LG here if this is really the case.
2) Availability of product is another issue we have found to be unacceptable. LG has promised us product and given us dates of when product is to be shipped to us. Not one of the dates they have promised us over the last 60 days has been held to and they continue to make up excuses about why they are not shipping product. Gochnauer's view is that product being offered to all of us should be available immediately or at worst case in the near future. We would rather a manufacturer tell us up front that a product will not be available at all or for a long time then string us along by saying it will be here soon or within 7 days and then continue to use those lines each week when we ask. We feel we have been lied to over and over and we will not tolerate this. We find out that certain models promised to us have not even been produced yet and might not even be made at all. How can something like this be to us "in another week yet"? This practice is wrong and we are now finding out what really is being produced and what is not being produced. We pass on all information received from LG to you and we will not allow our customers to be lied to in any way.
3) Another serious concern is what we have now been told from LG about our feelings and policies on internet sales. LG without written notice states that they will terminate us as a dealer if we do not stop selling their product over the internet at discounted prices. Their belief is to only sell the local people and to forget about the rest of the fine people across America. They also "off the record" have stated that they will not allow us to sell at discounted prices any longer and that we need to sell at suggested retail prices. That statement alone will be talked about extensively over the next couple of days. Beside being illegal, it is wrong and restricts the customer from making the best possible deal. We pride ourselves in giving you the best possible price we can and passing every allowance given to us on to you. If we are restricted from doing so and are terminated because of this, we are prepared to allow that to happen. We must not give in to these kinds of demands no matter who the company is and how big they are. Our customers are too important to us and we have too many other vendors wanting to offer their business to you with our terms in place. Gochnauer's is absolutely against this policy and will fight it until the bitter end if we need to. We might have to void a ton of sales we have with you but we can't allow big business to ruin what is right for you the customer in the end. We will personally accept temporary hardship to earn your trust and business in the future. It is the only fair thing to do.
Again, I ask for your patience until monday so that Gochnauer's may address these matters with LG and Zenith and get some real answers. I will personally be writing you monday afternoon with the results and will spell out exactly what will happen now. If we can convince them that our way is the best way and you the customer deserve better, we will get this product for you and ship right away. If however, LG continues to lie to us and try to enforce crooked price and internet policies and terminate us as a dealer, we will also deal with you directly at that time. Any orders in our system and that time will be canceled and any payment made to Gochnauer's will be promptly refunded. Gochnauer's is prepared to spend their money to allow you to save yours. We hope we are not terminated by the LG corporation but we will not allow them to ruin your free market rights and our ability to save you money. I would ask each one of our customers to stand up and have a voice in the matter however as we all as a group might be able to effect the outcome of this decision. If you feel that the internet selling and fixed price policy is wrong from LG, feel free to e-mail me back and I can then give you the people at LG to voice your complaint to. I have names and numbers here that I can pass on to anyone if asked for and we all together to stand up for what is right and what the beliefs of what this country was founded on. Each one of our other vendors that we have dealing with us have also been called and talked to and we can assure you that each one is also against the LG policy and will support Gochnauer's and you as our customer 100%. We hope that this matter will pass but are ready to accept whatever corporate does to our agreement so we can continue so serve you the way you need to be served. I thank you for your time reading this and your patience with us in this matter. Please feel free to e-mail if you have other questions or comments. We value your opinion.
Adam Gochnauer
Vice President
Gochnauer's Home Appliance Center
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