8 ms·

Cadillac (and other auto manufacturers) structure their program to include dealerships, rather than to cut them out. The sale gets booked against and delivered

by cosmie 6y ago

Cadillac (and other auto manufacturers) structure their program to include dealerships, rather than to cut them out. The sale gets booked against and delivered by a local dealership, rather than Cadillac the manufacturer. Tesla does not have an independent franchise/dealership model, and all of their local presence is corporate owned. This is what all the automakers have been against, as there are a rats nest of local/state laws that require legacy automakers to not compete with/cut out their dealerships with direct-to-consumer sales, but Tesla has avoided that impediment by resisting having to adopt the sales framework the legacy manufacturers can't legally get out of. That said, manufacturers would love to be able to adopt Tesla's model; dealers are the ones that hate it as it's an existential threat. Manufacturers are only against Tesla's model to the extent that they're not legally allowed to adopt it, so consider it an unfair advantage.

bluGill 6y ago
I'm not sure if the manufacturers are against it. It is complex. Dealers are the human face of the company. Someone to talk to in your town if things go wrong. Assurance that there is a mechanic that can fix it if something breaks (not just the engine, there are many other parts that can breaks. Assurance someone will be able to get the parts you need. That doesn't means they have to like the dealer model, but there are real advantages to it.
- Tuna-Fish 6y ago
  All those advantages could be provided by the car company owning all the dealerships that sell their cars, except it would be cheaper for both the car company and customer.
  - s1artibartfast 6y ago
    Why do you assume it would be any cheaper for the customer? I think it could actually increase prices by reducing the number of sellers in the market. You would have a single retailer for each brand.
    - maxerickson 6y ago
      Here we have a single retailer for all the brands. One group owns most of the dealerships. (which is some sort of regulatory problem probably, the point is that it is the status quo for there to be a dealership oligopoly in many areas)
      - gamblor956 6y ago
        This is simply not true. There are thousands of independent car dealerships in the US. There might be a local monopoly in a town, but you can always just drive a few miles over to the next dealership.
        maxerickson 6y ago
        How is "local monopoly in a town" substantively different than "oligopoly in an area"? It's not really super convenient to get service 60 miles away.
        gamblor956 6y ago
        Tesla makes people drive hundreds of miles and that doesn't seem to have hurt them. Worse, Tesla is effectively a a national monopoly. And that's far worse, because it has no competition for sales of Tesla vehicles or service.
    - AnthonyMouse 6y ago
      If the manufacturer could raise prices without losing sales to other brands, they would do that already. Eliminating the dealerships removes a middle man and the corresponding overhead. The manufacturer might like to claim the entire savings, but there are two reasons that typically wouldn't happen. First, then the manufacturer's margins are higher, which changes the calculation of how much margin to sacrifice to increase sales volume. If before the manufacturer was making $2000/car and the dealer was making $2000/car then the manufacturer lowering the price by $1500/car to double their sales isn't profitable; double $500 isn't more than $2000. If the manufacturer is now making $4000/car by cutting out the dealership, lowering the price by $1500/car to double their sales is worth it; double $2500 is more than $4000. And then second, because the competing manufacturers would have the same incentives under the same circumstances. If they lower their prices by $1500 to double their sales, that's coming at your expense if you don't do the same.
  - bluGill 6y ago
    I'm not sure it would be cheaper. The car company needs to pay all the people in the dealership plus back office staff to manage all those dealers. It might or might not be cheaper. It is for sure a distraction from their real job (design and assembly of cars and engines)
    - lsaferite 6y ago
      You could easily move to a no-haggle model at that point. You also cut out a middleman business that wants profit on top of your profit. Yes, you have to pay those end sales people, but you don't pay the profit of that dealership owner.
      - wobbly_bush 6y ago
        Coming from a country which haggles all the time (India), and seeing the in general no-haggle culture of US, I was always surprised car purchase is one of the areas where haggling is culturally acceptable.
        frosted-flakes 6y ago
        Haggling is acceptable in Canada/USA with most large purchases. Cars, houses, hand-made furniture, bulk purchases, building leases, etc. Haggling is generally not accepted only when it doesn't scale well, which also has the advantage of greater transparency and fairness in those cases. In line with the above, private sellers are generally amenable to haggling because it doesn't matter that it doesn't scale. So when buying a used anything on Kijiji, haggling is expected, particularly if it says "OBO" (or best offer), but not if it says "firm". If the price is set semi-arbitrarily at the time of purchase, like some U-pick auto junkyards, the person setting the price is right there anyway, so haggling may be acceptable. I haven't researched any of this; this is just my intuition from experience.
        mikepurvis 6y ago
        This matches my experience; I think some Kijiji sellers do get haggling fatigue after a while, where they've dealt with one too many tire-kicker types who show up offering 50% (or less) of the listed price. Or play other games, like agreeing on a price and then showing up short of cash and making a scene about having to drive back out and find the nearest bank machine. I had this happen once and stood my ground over it; suddenly the missing $20 miraculously appeared with no ATM trip necessary. Anyway, being able to advertise a price as firm does provide a convenient escape hatch in that scenario.
- perl4ever 6y ago
  I realized recently something that set me firmly against ever going back to the dealer - while I could afford their repair rates when necessary, they aren't able to figure out obvious problems, or don't want to bother, and the service advisors are on commission. For years, I was aware of the cracks about "stealerships" and I didn't pay much attention, because I figured you get what you pay for and hadn't found a good independent mechanic. But I happened to see a help wanted ad for dealer advisors that mentioned commissions, about the same time as I had paid for an expensive repair on an out-of-warranty vehicle after dragging my feet quite a bit. Maybe this is naive, but I genuinely did not know about the conflict of interest, and I expected the half of the dealer that sold (used) luxury vehicles to be no more predatory than the half that sells regular cars. On purchase, I figured, meh, I can afford the repairs, but I didn't count on paying for ones I didn't need and having ones I did ignored.
  - whatevertrevor 6y ago
    Wait I'm a noob, so your dealer is also your mechanic shop? And the mechanics make a living by earning a commission out of your repair invoices?
    - jsight 6y ago
      Yes, dealers also perform service, even beyond warranty items. The mechanics may not make a commission, but they are usually not the people talking directly to customers at a dealership. Instead, they send a "service advisor" that may or may not have any idea about cars. This person's job is to make money for the dealership and it isn't uncommon for their compensation to be commission based. There are conflicts of interest everywhere in this process, as you might imagine.
      - jcrawfordor 6y ago
        the split between service reps and the actual service department is another reason I don't like having service done at the dealer, it's annoying having the service rep have a hard time interpreting notes written by the mechanic that worked on it, when at an independent shop you'd just talk to the mechanic. But most dealerships are set up with a "service bay" that's just the desks of the service reps and a couple of parking spots, then after you leave they drive the cars around back to the actual service department. There's total isolation between the customers and the people doing the work. I suspect they might consider this a feature, "white glove service" or something, but it's irritating when you e.g. bring something in for diagnostics, and then get the diagnostic report from someone who doesn't understand half of it - an experience I have had repeatedly taking my lemon of a Nissan to the Nissan dealership because no one else in town has the stupid Nissan proprietary diagnostic computer. Seriously, when I brought it in to have them figure out a problem that had been frustrating me for a while (I do most of the work on my cars myself), they confirmed my suspicion that it was the fuel pump and maybe saved me the work of replacing the fuel pump when it wasn't the problem. But, the service advisor also told me they recommended replacing the entire steering rack (!). When I asked why, he seriously struggled to come up with an answer, and just said something about it being worn. Really? the quoted rate on the replacement was more than the car was worth, and he didn't even know why they were recommending it. Now I think I need a stability control reset that as far as I can tell only the dealership can do. I've really been avoiding bringing it in as I know they're going to charge me at least their $170 diagnostic rate and probably write me a quote for over $8k in work again, all for something that apparently takes about 30 seconds if you happen to have a Nissan CONSULT II.
- AnthonyMouse 6y ago
  > Dealers are the human face of the company. Someone to talk to in your town if things go wrong. Assurance that there is a mechanic that can fix it if something breaks (not just the engine, there are many other parts that can breaks. Assurance someone will be able to get the parts you need. Basically all of those things died with the rise of the internet, because you then have direct access to the manufacturer via their website and could order parts and have them shipped to you. It would also be a lot easier to find a local mechanic if the manufacturers would publish the service documentation for their vehicles on their websites, which they don't do primarily to placate the dealerships who don't want the competition. It's almost surprising that you can't buy cars on Amazon yet. You can buy cars on eBay, although presumably not direct from the manufacturer as a result of the nonsense dealership laws.
  - moz14015 6y ago
    Amazon is actually quietly looking into this, but they are doing it through AWS so as to not attract attention
    - gdoptimizer 6y ago
      Can you give reference that AWS was after car selling business? I only know there was AWS engineering platforms for automotive industry.
  - astura 6y ago
    Carvana is the Amazon equivalent for cars, however, they sell used cars only.
  - agustif 6y ago
    You can do Renting/Leasing of new cars in Amazon.es (Spain) https://www.amazon.es/Renting-Coches/ https://www.amazon.es/Renting-Coches/
- eldavido 6y ago
  I live in a building in (Bay Area) Oakland Chinatown. A phrase the older Chinese folks use a lot in my building is "the older generation" or "the younger generation". As in, "the younger generation likes buying things online", or "the older generation prefers making a phone call". It's made me think more generally about generational differences and how they affect buying patterns, and patterns of doing business generally. I realized, for example, that I really can't stand dealing with contractors (e.g. HVAC) in the older generation who refuse to use Google Calendar or email, and insist on doing everything over the phone, and face-to-face. I think this "human face of the company" is a good example of a generational difference at play. I categorically do not want to interact with anyone at a dealership. I get product information from word-of-mouth/friends, YouTube, and other sources. Provided a company put some money into creating a customer experience that offered the same level of customization you'd get from a dealership experience (color, trim level, etc) I would be the first person to make a $20-30K purchase online. Not least of which because I'd be confident they'd have built a system not to fuck up my order vs. however it would get input by the person at the dealership who inevitably needs to enter it into the OEM's system to order it. More and more it feels like I'd rather just rip the humans out and deal more directly with a company's back-office systems (e.g. for placing a car order), than have to play a giant game of telephone explaining something, only to have a human screw it up when entering it. It also annoys me when I call customer service and they remind me 20 times that I should use the website. Of course I should use the goddamned website. I wouldn't be calling customer service if I didn't try that first. This is probably something that won't change until people now in their 20s/30s are in positions to make these decisions in companies, at which time there will be some new trend the "oldsters" don't get. So it goes.
  - wideasleep1 6y ago
    You must be a millenial. No worries, a Gen-X'r here, and I enjoyed buying our last two cars at Cartelligent (Sausalito). Pay a small fee, and have the car delivered to your driveway, sign paperwork, orientation and away you go.
  - travisporter 6y ago
    “Did you know you could visit our website at w[long pause]w[long pause]w”
nradov 6y ago
I doubt that most mass-market auto manufacturers want to move away from the franchise dealer model. It's tremendously capital intensive. Tesla can make it work since their cost of capital is so low. Where would Ford or GM get the billions in funding to run thousands of dealerships across the country?
- khaledtaha 6y ago
  Having worked at an OEM and in automotive I can tell that what you’re saying is simply not true. Where would they get the money? From cutting out the middleman, from increasing sales by offering an alternative to the terrible dealership experience (spending 1-2 hours buying a car is not ok) and from gaining the flexibility to offer alternative business models (i.e. subscription models). Dealerships are the past. They may very well be the deadweight that will cause incumbent OEMs to sink rather than swim.
  - RhodesianHunter 6y ago
    If any of the major manufacturers were stuck with the entire inventory their dealerships are sitting on right now, that would sink them.
    - khaledtaha 6y ago
      That’s what’s happening. The article mentions that exact scenario.
      - RhodesianHunter 6y ago
        For every vehicle on a ship or stuck in port there are at least a dozen sitting on a dealer's lot.
- legolas2412 6y ago
  Because capital is extremely cheap in low interest environment? They would want to cut out the middlemen car dealerships.
sjg007 6y ago
The whole distributor model is antiquated. For cars, for alcoholic beverages etc...
- franga2000 6y ago
  Honestly, excluding the absurd situation with car dealerships and the laws they managed to get written for themselves, I'm rather glad most things still have local distributors. It forces companies to have many more local points of contact as they otherwise would, which improves customer service. For example, with my HP laptop, I ordered it and all accessories locally and in my language, can have it serviced within a few days at any of 3 locations in our country, have someone that I can argue with in my language when they inevitably try to claim the warranty was void somehow etc. If HP had chosen a direct distribution model, I would've had to order it online, send it halfway across the continent for service and have absolutely nobody to talk to in my language to in case of non-standard issues. We saw that exact with Apple some 10 years back, when it was impossible to get an iPhone from our country, because it didn't seem worth it to Apple, while Samsung and everyone else gladly threw phones at our distributors and watched the money pile up.
  - landryraccoon 6y ago
    Hmm you didn't like Apple's service? I bought a Macbook with Applecare. I had a problem with it and brought it to an Apple store. My data was backed up to the cloud so I had no issue surrendering it. I walked out with a brand new-in-box Macbook in less than an hour. Waiting a few days for it to be serviced seems like it would be a much worse experience...
    - jcrawfordor 6y ago
      According to MacRumors there are only apple stores in 24 countries. Working with independent distributors does tend to increase availability of products and services in smaller markets, such as small countries, because the market is "worth it" to resellers located in those countries while largely ignored by the manufacturer.
    - 6y ago
redtexture 6y ago
When GM went bankrupt, why didn't they ditch the entire dealer network, instead of culling hundreds of small dealers?

by cosmie 6y ago

bluGill 6y ago

I'm not sure if the manufacturers are against it. It is complex. Dealers are the human face of the company. Someone to talk to in your town if things go wrong. Assurance that there is a mechanic that can fix it if something breaks (not just the engine, there are many other parts that can breaks. Assurance someone will be able to get the parts you need. That doesn't means they have to like the dealer model, but there are real advantages to it.

Tuna-Fish 6y ago
All those advantages could be provided by the car company owning all the dealerships that sell their cars, except it would be cheaper for both the car company and customer.
- s1artibartfast 6y ago
  Why do you assume it would be any cheaper for the customer? I think it could actually increase prices by reducing the number of sellers in the market. You would have a single retailer for each brand.
  - maxerickson 6y ago
    Here we have a single retailer for all the brands. One group owns most of the dealerships. (which is some sort of regulatory problem probably, the point is that it is the status quo for there to be a dealership oligopoly in many areas)
    - gamblor956 6y ago
      This is simply not true. There are thousands of independent car dealerships in the US. There might be a local monopoly in a town, but you can always just drive a few miles over to the next dealership.
      - maxerickson 6y ago
        How is "local monopoly in a town" substantively different than "oligopoly in an area"? It's not really super convenient to get service 60 miles away.
        gamblor956 6y ago
        Tesla makes people drive hundreds of miles and that doesn't seem to have hurt them. Worse, Tesla is effectively a a national monopoly. And that's far worse, because it has no competition for sales of Tesla vehicles or service.
  - AnthonyMouse 6y ago
    If the manufacturer could raise prices without losing sales to other brands, they would do that already. Eliminating the dealerships removes a middle man and the corresponding overhead. The manufacturer might like to claim the entire savings, but there are two reasons that typically wouldn't happen. First, then the manufacturer's margins are higher, which changes the calculation of how much margin to sacrifice to increase sales volume. If before the manufacturer was making $2000/car and the dealer was making $2000/car then the manufacturer lowering the price by $1500/car to double their sales isn't profitable; double $500 isn't more than $2000. If the manufacturer is now making $4000/car by cutting out the dealership, lowering the price by $1500/car to double their sales is worth it; double $2500 is more than $4000. And then second, because the competing manufacturers would have the same incentives under the same circumstances. If they lower their prices by $1500 to double their sales, that's coming at your expense if you don't do the same.
- bluGill 6y ago
  I'm not sure it would be cheaper. The car company needs to pay all the people in the dealership plus back office staff to manage all those dealers. It might or might not be cheaper. It is for sure a distraction from their real job (design and assembly of cars and engines)
  - lsaferite 6y ago
    You could easily move to a no-haggle model at that point. You also cut out a middleman business that wants profit on top of your profit. Yes, you have to pay those end sales people, but you don't pay the profit of that dealership owner.
    - wobbly_bush 6y ago
      Coming from a country which haggles all the time (India), and seeing the in general no-haggle culture of US, I was always surprised car purchase is one of the areas where haggling is culturally acceptable.
      - frosted-flakes 6y ago
        Haggling is acceptable in Canada/USA with most large purchases. Cars, houses, hand-made furniture, bulk purchases, building leases, etc. Haggling is generally not accepted only when it doesn't scale well, which also has the advantage of greater transparency and fairness in those cases. In line with the above, private sellers are generally amenable to haggling because it doesn't matter that it doesn't scale. So when buying a used anything on Kijiji, haggling is expected, particularly if it says "OBO" (or best offer), but not if it says "firm". If the price is set semi-arbitrarily at the time of purchase, like some U-pick auto junkyards, the person setting the price is right there anyway, so haggling may be acceptable. I haven't researched any of this; this is just my intuition from experience.
        mikepurvis 6y ago
        This matches my experience; I think some Kijiji sellers do get haggling fatigue after a while, where they've dealt with one too many tire-kicker types who show up offering 50% (or less) of the listed price. Or play other games, like agreeing on a price and then showing up short of cash and making a scene about having to drive back out and find the nearest bank machine. I had this happen once and stood my ground over it; suddenly the missing $20 miraculously appeared with no ATM trip necessary. Anyway, being able to advertise a price as firm does provide a convenient escape hatch in that scenario.
perl4ever 6y ago
I realized recently something that set me firmly against ever going back to the dealer - while I could afford their repair rates when necessary, they aren't able to figure out obvious problems, or don't want to bother, and the service advisors are on commission. For years, I was aware of the cracks about "stealerships" and I didn't pay much attention, because I figured you get what you pay for and hadn't found a good independent mechanic. But I happened to see a help wanted ad for dealer advisors that mentioned commissions, about the same time as I had paid for an expensive repair on an out-of-warranty vehicle after dragging my feet quite a bit. Maybe this is naive, but I genuinely did not know about the conflict of interest, and I expected the half of the dealer that sold (used) luxury vehicles to be no more predatory than the half that sells regular cars. On purchase, I figured, meh, I can afford the repairs, but I didn't count on paying for ones I didn't need and having ones I did ignored.
- whatevertrevor 6y ago
  Wait I'm a noob, so your dealer is also your mechanic shop? And the mechanics make a living by earning a commission out of your repair invoices?
  - jsight 6y ago
    Yes, dealers also perform service, even beyond warranty items. The mechanics may not make a commission, but they are usually not the people talking directly to customers at a dealership. Instead, they send a "service advisor" that may or may not have any idea about cars. This person's job is to make money for the dealership and it isn't uncommon for their compensation to be commission based. There are conflicts of interest everywhere in this process, as you might imagine.
    - jcrawfordor 6y ago
      the split between service reps and the actual service department is another reason I don't like having service done at the dealer, it's annoying having the service rep have a hard time interpreting notes written by the mechanic that worked on it, when at an independent shop you'd just talk to the mechanic. But most dealerships are set up with a "service bay" that's just the desks of the service reps and a couple of parking spots, then after you leave they drive the cars around back to the actual service department. There's total isolation between the customers and the people doing the work. I suspect they might consider this a feature, "white glove service" or something, but it's irritating when you e.g. bring something in for diagnostics, and then get the diagnostic report from someone who doesn't understand half of it - an experience I have had repeatedly taking my lemon of a Nissan to the Nissan dealership because no one else in town has the stupid Nissan proprietary diagnostic computer. Seriously, when I brought it in to have them figure out a problem that had been frustrating me for a while (I do most of the work on my cars myself), they confirmed my suspicion that it was the fuel pump and maybe saved me the work of replacing the fuel pump when it wasn't the problem. But, the service advisor also told me they recommended replacing the entire steering rack (!). When I asked why, he seriously struggled to come up with an answer, and just said something about it being worn. Really? the quoted rate on the replacement was more than the car was worth, and he didn't even know why they were recommending it. Now I think I need a stability control reset that as far as I can tell only the dealership can do. I've really been avoiding bringing it in as I know they're going to charge me at least their $170 diagnostic rate and probably write me a quote for over $8k in work again, all for something that apparently takes about 30 seconds if you happen to have a Nissan CONSULT II.
AnthonyMouse 6y ago
> Dealers are the human face of the company. Someone to talk to in your town if things go wrong. Assurance that there is a mechanic that can fix it if something breaks (not just the engine, there are many other parts that can breaks. Assurance someone will be able to get the parts you need. Basically all of those things died with the rise of the internet, because you then have direct access to the manufacturer via their website and could order parts and have them shipped to you. It would also be a lot easier to find a local mechanic if the manufacturers would publish the service documentation for their vehicles on their websites, which they don't do primarily to placate the dealerships who don't want the competition. It's almost surprising that you can't buy cars on Amazon yet. You can buy cars on eBay, although presumably not direct from the manufacturer as a result of the nonsense dealership laws.
- moz14015 6y ago
  Amazon is actually quietly looking into this, but they are doing it through AWS so as to not attract attention
  - gdoptimizer 6y ago
    Can you give reference that AWS was after car selling business? I only know there was AWS engineering platforms for automotive industry.
- astura 6y ago
  Carvana is the Amazon equivalent for cars, however, they sell used cars only.
- agustif 6y ago
  You can do Renting/Leasing of new cars in Amazon.es (Spain) https://www.amazon.es/Renting-Coches/ https://www.amazon.es/Renting-Coches/
eldavido 6y ago
I live in a building in (Bay Area) Oakland Chinatown. A phrase the older Chinese folks use a lot in my building is "the older generation" or "the younger generation". As in, "the younger generation likes buying things online", or "the older generation prefers making a phone call". It's made me think more generally about generational differences and how they affect buying patterns, and patterns of doing business generally. I realized, for example, that I really can't stand dealing with contractors (e.g. HVAC) in the older generation who refuse to use Google Calendar or email, and insist on doing everything over the phone, and face-to-face. I think this "human face of the company" is a good example of a generational difference at play. I categorically do not want to interact with anyone at a dealership. I get product information from word-of-mouth/friends, YouTube, and other sources. Provided a company put some money into creating a customer experience that offered the same level of customization you'd get from a dealership experience (color, trim level, etc) I would be the first person to make a $20-30K purchase online. Not least of which because I'd be confident they'd have built a system not to fuck up my order vs. however it would get input by the person at the dealership who inevitably needs to enter it into the OEM's system to order it. More and more it feels like I'd rather just rip the humans out and deal more directly with a company's back-office systems (e.g. for placing a car order), than have to play a giant game of telephone explaining something, only to have a human screw it up when entering it. It also annoys me when I call customer service and they remind me 20 times that I should use the website. Of course I should use the goddamned website. I wouldn't be calling customer service if I didn't try that first. This is probably something that won't change until people now in their 20s/30s are in positions to make these decisions in companies, at which time there will be some new trend the "oldsters" don't get. So it goes.
- wideasleep1 6y ago
  You must be a millenial. No worries, a Gen-X'r here, and I enjoyed buying our last two cars at Cartelligent (Sausalito). Pay a small fee, and have the car delivered to your driveway, sign paperwork, orientation and away you go.
- travisporter 6y ago
  “Did you know you could visit our website at w[long pause]w[long pause]w”

nradov 6y ago

I doubt that most mass-market auto manufacturers want to move away from the franchise dealer model. It's tremendously capital intensive. Tesla can make it work since their cost of capital is so low. Where would Ford or GM get the billions in funding to run thousands of dealerships across the country?

khaledtaha 6y ago
Having worked at an OEM and in automotive I can tell that what you’re saying is simply not true. Where would they get the money? From cutting out the middleman, from increasing sales by offering an alternative to the terrible dealership experience (spending 1-2 hours buying a car is not ok) and from gaining the flexibility to offer alternative business models (i.e. subscription models). Dealerships are the past. They may very well be the deadweight that will cause incumbent OEMs to sink rather than swim.
- RhodesianHunter 6y ago
  If any of the major manufacturers were stuck with the entire inventory their dealerships are sitting on right now, that would sink them.
  - khaledtaha 6y ago
    That’s what’s happening. The article mentions that exact scenario.
    - RhodesianHunter 6y ago
      For every vehicle on a ship or stuck in port there are at least a dozen sitting on a dealer's lot.
legolas2412 6y ago
Because capital is extremely cheap in low interest environment? They would want to cut out the middlemen car dealerships.

sjg007 6y ago

The whole distributor model is antiquated. For cars, for alcoholic beverages etc...

franga2000 6y ago
Honestly, excluding the absurd situation with car dealerships and the laws they managed to get written for themselves, I'm rather glad most things still have local distributors. It forces companies to have many more local points of contact as they otherwise would, which improves customer service. For example, with my HP laptop, I ordered it and all accessories locally and in my language, can have it serviced within a few days at any of 3 locations in our country, have someone that I can argue with in my language when they inevitably try to claim the warranty was void somehow etc. If HP had chosen a direct distribution model, I would've had to order it online, send it halfway across the continent for service and have absolutely nobody to talk to in my language to in case of non-standard issues. We saw that exact with Apple some 10 years back, when it was impossible to get an iPhone from our country, because it didn't seem worth it to Apple, while Samsung and everyone else gladly threw phones at our distributors and watched the money pile up.
- landryraccoon 6y ago
  Hmm you didn't like Apple's service? I bought a Macbook with Applecare. I had a problem with it and brought it to an Apple store. My data was backed up to the cloud so I had no issue surrendering it. I walked out with a brand new-in-box Macbook in less than an hour. Waiting a few days for it to be serviced seems like it would be a much worse experience...
  - jcrawfordor 6y ago
    According to MacRumors there are only apple stores in 24 countries. Working with independent distributors does tend to increase availability of products and services in smaller markets, such as small countries, because the market is "worth it" to resellers located in those countries while largely ignored by the manufacturer.
  - 6y ago

redtexture 6y ago

When GM went bankrupt, why didn't they ditch the entire dealer network, instead of culling hundreds of small dealers?