3 ms·
> But they are still buying it and still taking the risk that it won't sell. I don't know about Costco, but the big box stores don't carry any risk. If the pro
by gav 6y ago
> But they are still buying it and still taking the risk that it won't sell.
I don't know about Costco, but the big box stores don't carry any risk. If the product doesn't sell then they return it and deduct that off your next invoice. The same happens for a customer return.
Depending on the retailer/product category you might get charged slotting fees, pay-to-stay, plus a share of promotional costs[1]. There are also other fees for use of distribution centers, discounts for paying early (even if it's not early), fees (or extended terms) for slow-moving products, and so on.
"Owning the items" feel less correct than "borrowing items with a promise to pay".
[1] https://traxretail.com/blog/quick-guide-shelf-space-costs/ https://traxretail.com/blog/quick-guide-shelf-space-costs/
- Falling3 6y ago> I don't know about Costco, but the big box stores don't carry any risk. If the product doesn't sell then they return it and deduct that off your next invoice. That clearly does not apply in many instances, otherwise we wouldn't have clearance sections. There are all kinds of scenarios where it's either not possible, not feasible, or just not economically viable to return products to the manufacturer.
- cnst 6y agoI'm not sure what's your point here is; but the idea is that with big B&M stores, it's still the manufacturer that is ultimately liable for the product; so, if the product doesn't sell, it's probably up to the manufacturer whether they want it back or may be interested in putting it into clearance and/or straight to the rubbish or recycling bins.