Subject:
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Re: Anatomy of a Shop At Home group order
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Newsgroups:
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lugnet.market.shopping
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Date:
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Tue, 9 Nov 2004 00:28:19 GMT
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Viewed:
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1718 times
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Allan Bedford writes:
> True. Since I'm not privy to any of LEGO's financial information all of my
> ideas and thoughts about this were pure speculation. However, it is clear to me
> that our $900 order was probably 600 - 700 dollars more sales than the company
> would have gotten from that same group of people had we not placed the order
> together. I assume some of that is profit for them. ;)
Especially when you consider that $200-300 would probably have been
spent at retail stores like TRU, where LEGO's percentage of the
proceeds is lower...
> In the case of my examples (Pampered Chef and Tupperware) the "salesperson" is
> just a person who makes contact with the company and agrees to take on the work
> of selling/ordering/distributing product to friends and family. Yes, the
> program would have to setup by LEGO, but the leg work is done in the field by
> the customers. The incentive to be that person comes from the discounts and free
> stuff offered to the customer acting as the agent.
I don't think LEGO would be interested in taking on a Pampered Chef or
Tupperware style of business model. For one thing, it would mean that
every AFOL would instantly sign up as a consultant for the discount
and they's lose the full-price AFOL sales they're getting now. It
would probably also violate the terms of their deals with retailers,
because they'd be selling product to the consultant at a discount and
thus undercutting retail prices.
As a Tupperware consultant I would love to see this happen, mind you.
I just don't think it can. Tupperware gives a 25% discount/commission
to all its consultants (25% off what you buy; 25% profit on what you
sell), plus other bonuses that can bring it up to 30-40% if you're
successful. I'm sure Pampered Chef is comparable. That's too big of
a bite for LEGO to take out of its profit in exchange for some
additional sales, and it would require a major reworking of their
business model for it to be a success.
> I'm not a business owner, just a guy from Canada who likes LEGO. It just seemed
> to me, the more I thought about our order, that there were good things about it
> that _possibly_ could be adopted by the company itself in order to generate more
> sales. More sales means the company continues to put out products that you and
> I love. :)
I think what you are doing at your company is great, and other AFOLs
should do the same (I'm thinking of trying it at my workplace as
well). But when you start offering a profit/discount to the person
who organizes it, it will become more of a headache than a profit
center for the company.
Look at it another way: small family-owned toy stores have trouble
fulfilling their orders. LEGO just isn't set up for this kind of thing.
--
William R Ward bill@wards.net http://bill.wards.net
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Help save the San Jose Earthquakes - http://www.soccersiliconvalley.com/
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Message is in Reply To:
 | | Re: Anatomy of a Shop At Home group order
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| (...) [My notes snipped... message was getting way too long.] :) (...) True. Since I'm not privy to any of LEGO's financial information all of my ideas and thoughts about this were pure speculation. However, it is clear to me that our $900 order was (...) (20 years ago, 9-Nov-04, to lugnet.market.shopping)
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