Article by Dr. Andrew Smith
The goal of this article is to discuss why retails sales and traditional product distribution are rapidly being replaced by direct sales and intellectual distribution.
To begin, let me explain what I mean by retail sales and traditional distribution: In traditional distribution, manufactured products are sold to wholesales. The wholesalers then sell those products to retail outlets and the retail outlets sell the products to the customer at a significantly greater cost than they purchased them for. Retail outlets have no choice other than to mark up the cost of products, as they have to pay for advertising, salaries, lighting, etc. and those costs must be covered by the customers if the retailers are to make a profit.
Intellectual distribution is the ability to get information about products and services to the potential customer, who then buys from the manufacturer (direct sales).
Have you ever visited a shop to discuss product prices, only to return home and find the product much less expensive Online? The product you are buying is the same in every way, but on the Internet you may be receiving it directly from the wholesaler or even the manufacturer. The World wide web has changed the way companies promote and educate us about their products and the costs to the consumer are greatly lessened as a result.
What does this mean for retail distribution? Can you see why many retail outlets and stores are struggling? Is this situation likely to continue?
It is my belief that it is the older generations who may be less acomplished using the Internet, keeping large sections of the retail industry from crisis. Imagine what will transpire when the majority of the population are on the Internet and buying directly from the manufacturers. Many people do grocery shopping online, Christmas shopping on the internet, we buy books, cds and dvds on the internet! Is there any limit to the products that we can purchase directly from wholesalers or manufacturers?
The situation is that retail distribution is struggling and direct sales is growing. This may be a very bad thing for retail outlets (look what happened to Woolworths in the UK!), but an excellent thing for direct sales businesses (i.e. Amazon).
As individuals we can capitalise on these economic changes. Firstly, we can buy products and services from direct sales companies. Also, we may be able to partner with a direct sales company, promoting the products and services they offer. You can be an independent agent and earn commissions from any sales you generate. This is ideally suited for the Internet and is definitely something worth considering in the 21st century!
About the Author
My name is Dr. Andrew Smith and I am the founder of WINOnline. Our team are dedicated to providing information regarding the current economy and aim to provide solutions for protecting your current income, whilst developing additional income streams. If you have an interest in positioning yourself ahead of future trends to work towards true wealth then we may be able to help! Visit http://www.winonine.biz/ or view our Blog at http://www.winonline.biz/blog
