|
There's a few factors involved...
+ Pure Play has good studios
+ Many stores are familiar with the studios
+ Most likely a lowered price to retailers
- Many stores depend on distributors to select the "hot" titles
- When retailer reorder titles, its nice to get them in a single shipment, instead of 1 or two and the added shipping costs
- Many retailers don't like writing individual checks
- Many retailers do not purchase from multiple sources to save shipping costs
- Increased sales force
- Increased shipping
- Increased collections
In doing so Pure Play must have the ability to sell and ship our MANY small orders, which means increasing warehouse staff, packaging supplies and all that. Also more time into selling the product, unless they hope to get stores on automatic and get in with all of the chain stores, like the Goalies, Suzies, etc. Not to mention accounts receivable and chasing money for ALOT of small retailers. Alot of these places are taking the product now, the question will be if it's worth it to continue to do so direct.
Many stores, are lazy and don't have the time to hand pick through the 1000+ new release DVDs that are available a month. That's where distributors come in. Here was the previous chain ...
Before
Studio ---> Pure Play ----> Distributor ----> Retailer -----> Consumer
Now
Studio ---> Pure Play ----> Retailer -----> Consumer
Maybe all the new costs will be off set by higher profit, maybe not. Since it's DVD few here will give 2 shits anyways.
|