ADVANTAGES COMPARED TO
ORDINARY IMPORT DISTRIBUTION
Any jewelry Distribution company has two parts or departments
1. Sales and Collections
2. Fulfillment and Shipping
Our proposal is to locate the Fulfillment and Shipping function
at the facility of the Producer of the products Artcamp in Taxco.
All the work of picking and shipping orders to retailers and other customers -
Artcamp can handle all that operation with a rack and parts-bin stock room.
With in-house Distribution Co., the products now only need to be handled **once**
this in itself is a BIG saving and argues for the merits of Producer Direct Distribution.
The establishment of a Producer Direct Distribution business owned and operated
by the woman’s artisans cooperative, would be a big breakthrough for artisans
becuase it would permit the enterprise to reap the benefit of being the creator
and producer of the merchandise; usually only the least amount is earned for that.
By being its own distributor, Producer would be competitive and also profitable.
Needed is shelves and stock inventory the salary of a young girl some advertising
What is finally needed is a volume of sales of at a minimum 50 packages weekly
So to attain the economy of scale to reach a $10usd factory-to-door delivery cost
HOW IT WORKS
Orders are generated by internet advertising and by creative public realtions efforts
the Artcamp website is variegated and extense, acts as a base for interest in Artcamp.
Both retailers and consumer customers are both addressed; volume discounts offered;
The key thing is to develop effective product offers in order to get orders and reorders.
Orders arrive via e-mail of FAX
Some products will be in stock ready to ship;
Some products will be semi finished – to inlay or bezel-set different stones for example
Some products will be produced, only when they have been ordered
When the individual order is completed and all pieces are finished
- gift carded or price tagged or bar coded or whatever -
The Producer women then Prepare proper Packing Lists for the individual orders
whether it is to a Retail Customers or to a Store and enclose the Packing Lists
together with the merchandise inside individual USPS Priority Mail envelopes.
A group of these individual shipments are ganged together
And shipped in a single shipment to the United States
where they are broken apart and the individual shipments
released to the United States Postal Service. The cost
Of the delivery of such a package door to door is $10.00usd.
So the product from the factory in Taxco
can get delivered to any door in the USA or Canada
for only $10.00usd in the optimum case
of 50 packages being shipped out/week.
By this method is eliminated a lot of serious costs
that any USA-based Jewelry Distribution Business
will still have to pay for. This should be a decisive
strategic advantage so the artisans can take benefit.
1. saves the cost of holding stock on a shelf in the USA/Canada facility;
at Taxco, the amount of product held in stock can be very much lower.
2. save the cost of persons who are going to be handling the stock in the US
the benefits, the taxes, communication, everything to do with labor relations
3. save the costs of the fulfillment facility itself,
4. the space, the shelving, the postage meter etc
5. save the cost of counting the product
when the Mexican women have already counted it
it would be more efficient to go through the motions only once.
6. special orders are easier to accomodate and the problem of back-orders mitigated;
instead of sending orders short this piece or that, Producer hurries up and makes them
7. the real value of an ordering, fulfilling, labeling, counting, boxing etc capability
just at the end of a cottage industry handcraft jewelry enterprise production line.
The equally important questions of marketing, selling, and collecting.
can be adressed as a separate topic; the key here is fulfillment facility.
Producer offers a price list for its entire product line at any time; stated price
for each item is *delivered* to the customer’s door in the USA or Canada.
Shipping is included in the product, the customer does NOT have to think about it.
This is a clean natural concept of collapsing the distribution chain back to the producer
Establishing produce –owned distribution is a natural idea whose time has clearly come.
With only a minimum of extenuation costs - either Producer can use the advantage to compete with the cheap Oriental product that is its deadly competition, or, Artcamp can enjoy margins from the unique quality of its product in the fashion market, as net profit.
Producer as marketing Distributor means it is in a position to receive market data
using that knowledge to inspire an infinite series of design/development projects.
The cycle that Producer would complete: Customer-Retailer- Distributor- Producer-
The need of the Producer is to create markets for its own handcraft jewelry products
and still be in commercial position to take full advantage of those markets it has created.
The best way it can accomplish this worthy project is to become its own Distributor.