Online shopping

Discussion in 'Internet Marketing' started by LordRoco, Apr 11, 2013.

  1. LordRoco

    LordRoco
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    I am wondering how online shopping sites sell things for discounted price when the same thing costs more in the market? Recently, I brought a watch for my father, a wildcraft wallet for me, a bag for my sister and a dining set because my mom wanted one - all at a total cost of less than 50$!! Whereas, in the market, these branded items which I have secured would cost so much more.

    How do these sites do it? I am curious to know.
     
  2. Rocky

    Rocky
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    These sites source the products directly from the manufacturer which allows them to save lot of cost upfront. Later on, they do not incur capital expenses like the outlet or showroom which is the case with retailers for which they have to markup the price. The online shops save cost on various occasions and are able to sell at lower prices.
     
  3. LordRoco

    LordRoco
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    That is a very interesting idea! I wish if I could start up something as cool as that! But the question is, if they are selling branded items for less cheaper price, then wouldnt the company brand oppose it on charges of undermining market rate? For example, if I was to sell a product for MRP 300/-, I wouldnt let another seller sell my products for 200/-? That would be absurd
     
  4. charleisol

    charleisol
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    i agree with rocky extra taxes which retailers pay they don't need to pay
     
  5. Joseph.Shivell

    Joseph.Shivell
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    Manufacturers set the cost for the retailer, not the retail price. For example, if a company manufacturing widgets sold them to retailers for $20/case, and there were 100 widgets per case, the cost to the retailer would be $.20 each. Based on the retailer's expenses, they wold then set a retail price that allows them to make the desired profit. Because a brick and mortar retailer has rent, upkeep, wages, taxes, and perhaps other expenses to pay, he would have to charge a higher price than someone selling from a website. A long as the manufacturer gets his $20/case, and is able to maintain the same sales rate, it doesn't matter what the retailer charges.
     
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  6. altcom

    altcom
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    In additional, if a retail purchase a stock clearance or buy in huge volume from a manufacturer, the price may go down some more.
     
  7. LordRoco

    LordRoco
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    That might be a reasonable explanation, but online shopping are competition intensive and sites compete amongst each other as to who puts up the lowest possible price. I found a book that I have yearned for priced 600/- and another site listed the same for 520/-. How do they reduce costs of books? Buying in bulk donot seem to be an option because most books are not brought in bulk quantities unless there is a huge demand for them.
     
  8. jiashia

    jiashia
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    yeah, wholesale and branding that is the reason, also location and shipping cost take place, if you live near some huge factory producing for example cans, you may get them almost for free as they producing cost may be not so much, while transportation costs may fix that price reasonably
     

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