Friday, September 19, 2003

eBay is moving in
I just heard from a co-worker that eBay is going to be at our industry's big show this year in Vegas. They're going to be doing seminars for the independent dealers in our industry to show them how to utilize the eBay marketplace to sell product online. Most manufacturers in this industry are against online sales. We don't like it because we feel it hurts our independent dealer channel's value and because there could be legal complications. As a result, my company has taken a stance to only sell a limited amount of product online (trinkets and trash as we like to say) and disallow our dealers to sell anything online. Now eBay is moving in and wooing the dealers.

I've been warning people at all levels of the company that we better come up with a solution to make ecommerce work or someone else will. Now that “someone else” is eBay, likely the biggest ecommerce player on the market today. The only crack of light I see in this is that it may still be early enough to partner up with eBay so that we have some say in how things work. If we don't work with eBay, then there is a good chance they will dictate how the game is played with our dealers. Sure, we can tell our dealers they're no longer an authorized dealer if they sell online (which we do currently) but what happens when they all sell online? What happens when other manufacturers bite the bullet and say its OK to sell online? Or worse, what happens when our major competitors join forces with eBay and make a compelling sell to our dealers to only carry our competitors' products in exchange for great new opportunities? I don't like the looks of this. Granted, ecommerce will likely only cover 10% of total sales in most industries, but we still have to account for that 10% somehow.
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The Colonel