RE: Think of it as a home equity loan...TOMMEEEK
posted on
Jul 13, 2005 07:36AM
TK - The Big Box retailers have very different timelines for different product categories. It is one of the biggest hang ups for my industry since we have a very long lead time -- over 120 days for large multi-container orders. Whereas a company like Samsung might have many containers of current inventory already in stock in a DC and can ship quickly to increase their product turns. Large retailers are notorious for underbuying and then blaming the manufacturer for not having extra stock sitting around waiting to cure the retailers` problem.
The brand would not announce anything until the retailer(s) were on board for the obvious reason of ``you gotta go somewhere to buy the thingy.`` Many times the ``announcement`` comes as national ads with major retail logos included once the product is in place. And / Or, the brand pays the retailer to include the new product in the retailers ads -- coop advertising.
Product line reviews take place late in the year and into the CES season...never fun to fly to Minneapolis in January (Target, Best Buy, MusicLand Group). Most Holiday buys are made by the end of spring, depending on the volume, the product category, and the store ``resets`` (done by most at least once a year). The manufacturing would take place in the summer and the product load in would be in October / early November -- that`s why you now see Christmas ads before Thanksgiving and retailers pray for cold wheather to get you ``in the mood`` for Holiday shopping.
Payment terms vary, but the CE business is usually Net 60 or Net 90 unless the retailer buys ``FOB Factory`` (also called EX-Works) which means the retailer owns the product at the factory dock and pays earlier to get the best possible deal -- this is the Wal-Mart advantage as they have the best logistics and supply chain management in the world.
As for announcing the platform owner, a smart brand would just market the product as their own and not mention the ``designer`` company unless there was an advantage like the famous tones followed by the ``Intel Inside`` logo. Intel made it part of their selling program.
Hope that helps or you can always email me at JHawk103@aol.com
John