Group buy feeler post - RS2 cam

[Brett Dikeman]

At 12:44 PM -0700 5/14/04, Ned Ritchie wrote:

>Since the Audi group is really a small group of people

It used to be.  Now it isn't.  Have you ever noticed that A4's and 
A6's are damn near everywhere?  The Audi turbo is in full force, with 
zillions of A4 1.8t's and a fair number of A6 2.7tt's running around 
too. Never have there been so many turbo models; the A4, A6, S4, RS6, 
two models of TT...  Here in MA, Audis are a dime a dozen, and a 
large # of them are turbos.

>  and small businesses it reduces the ability for vendors as a whole 
>to produce new parts and have viable
>businesses.

In most cases where group purchases are done, there isn't enough 
market to justify bringing in/making a part, or the part is so 
prohibitive in single-unit quantities that nobody would buy 'em in 
the first place.  Whose fault is that?

I remember a bunch of vendors got all bent out of shape after a Samco 
hose group purchase.  Samco sold a huge number of units at a 
discounted price to I-5 turbo owners.  The vendors said Samco had 
cheated them of sales, undercut them on price, blah blah blah.

It wasn't Samco's fault that all their vendors had priced themselves 
unreasonably, and that when someone came along and negotiated 
reasonable pricing, people lined up.  Their vendors couldn't sell, so 
Samco went elsewhere.  There's absolutely nothing that stopped a 
Samco vendor from buying more hoses to get a better price from Samco, 
and/or cutting their own profit margin per item.  We're talking the 
absolute basics of economics in a free-market economy here.

>I've talked to other vendors about this and speaking from experience 
>there are several neat trick
>performance parts I CHOSE NOT TO MANUFACTURE because one year there was
>a group buy that messed with our cash flow.

I presume you're speaking about the 200q20v ECU upgrade purchase that 
Chris Miller put together.  Which earned you a considerable amount of 
free advertising and brought in a large number of sales to both you 
and Hoppen.  You essentially got a number of customers handed to you 
on a silver platter.  Further, myself and others have always 
maintained to those who have asked that your upgrade is one of the 
better choices.

   That group buy gave you a big influx of cash, and plenty of people 
bought who would not have ordinarily because of publicity, pricing, 
and opportunity.  It is a special twist on reality to then claim that 
the large amount of cash somehow kept you from making more product. 
I've forgotten a great deal of my 3 semesters of economics, but I do 
remember the time value of money.

>I don't think anyone excited about a group buy ever thinks about 
>this bigger picture.  I know I didn't.

In most cases the problems with group purchases have been related to 
inadequacies on the part of the vendor.  They fail to handle issues 
with their distributors and instead try to shove them off to their 
customers instead of pushing back on the distributor. They bite off 
more than they can chew in terms of the # of orders they think they 
can handle.  They don't know how to handle customers.  They don't 
plan appropriately. They don't perform due diligence in checking the 
details, etc.

>In summary: Group Buys are not good for the Audi community

They're plenty good.  They connect sellers with buyers.  However, 
they can and do blow up in people's faces.  The organizer of the 
group buy needs to ask tough questions and make sure the company 
being dealt with will come through, especially if there are problems. 
Participants need to exercise plenty of due caution.

>and now you know how many vendors are now feeling about those who 
>promote them.

Vendors who don't want to do group purchases don't have to accept the 
business.  Free country.

Brett
-- 
"They that give up essential liberty to obtain temporary
safety deserve neither liberty nor safety." - Ben Franklin
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