[Leica] Should Leica sell direct to customers?

[red735i at earthlink.net (Frank Filippone)]

Peter.. it is a cash flow issue.  The dealers buy and pay today based on
tomorrow's sales.  Leica gets paid today.  They need that cash desperately.
Direct sales does not offer this cash flow incentive.  Can you imagine what
would happen if the dealers were cut off, and Leica tried to sell direct?
The accumulated inventory of your local stores would need to be depleted
before any significant volume of cameras wee ordered again from the factory.
Disaster.

Building to order ( job shop methodology) cuts all advantages of
manufacturing volume into shreds.  You must make in batches in scheduled
runs.  Leica does this now, and the configuration program will prove that
unless they pull the specials off the line to custom adapt ( and have a
dedicated modification department to perform the mods) they will lose their
shirt on this sales idea.   ITW, more disaster.

Frank Filippone
red735i@earthlink.net
\
Dealers hold inventory, the cost of which they pass on to you the buyer. If
the
factory is selling direct to the purchaser then it isn't building for dealer
inventory and can reduce its workforce accordingly as it now knows what the
actual demand is. Thisd means that costs and probably prices can be reduced,
or
at least that there is more room for flexibility. However dealer stock does
have
the effect of cushioning the factory from the worst of surges in demand.