I would be interested in your views on the current state of pricing in our gift and book market - or indeed other areas too.  Whether you work in the trade or are simply a consumer - do you agree / what do you think?

Our products have a recommended retail price (RRP) ... they also have an ISBN number.  This ISBN number allows trade users to download the product information and images from the central ISBN system.  Once they have done that, it is possible to offer them and any other books with ISBN numbers for sale on their own websites.

So ... we end up with many websites offering a full range of products for sale - and more often than not without having any stock.

Next step for these websites is to encourage the consumer to buy from their site rather than others - and they tend to do this through discounting the price. In particular when their service and turnaround is not as good as other shops.

If the consumer is drawn in by the low price and places an order, the website company then has to get hold of stock from somewhere official or unofficial.  This takes time and delays the delivery to the customer.

Often these prices are only a few pence above the trade price - so there is hardly any profit in it for the website shop if at all - but they have taken no risk in making the product available for sale more than the investment in their website.

This discounting destroys any value in the product for other retailers who need to maintain a level of profit to run their business - to pay the rent, to pay the staff wages, to insure their stock and I could go on.

So - these retailers stop selling the products - or discount to some degree themselves - and often end up going bust as it is an unsustainable model for them.  Bookshops in particular are struggling to survive and the recent demise of large bookshops such as Borders is a prime example.

How often do we hear people browsing in bookshops saying that they will leave to buy it cheaper on other websites?

Another example would be the loss-leader selling done by supermarkets to encourage you to shop in their outlet.  OK, the end consumer can get a bargain on that particular product - but this discounting also destroys any value in the market for the other specialist shops and the manufacturers and distributors involved with getting the product to market.

I am all for the consumer being able to shop around to get the best deal ... I do this myself ... but do I ever stop and think about the consequences of my actions?

- The fact that the specialist shop where I like to touch the product in the first place before I buy may no longer be there ...
- The fact that I would never of heard of the product unless the local shop had stocked it and shown it to me ...
- The fact that the manufacturer may not be able to afford to invest in the development of any new products in the future ...
- The fact that the employees of those retail shops may lose their jobs when the businesses close ...

Again, I could go on ...

So in conclusion to this rant ... what is the answer?

Could products have an RRP and a range within which the product has to be sold?
Should the supply chain manage the supply so that website outlets can not abuse the system by ordering 1 copy or even by accessing the product details and images so easily?
Should consumers recognise that they are paying for the product which also pays for sustainability of everyone involved in that particular business supply chain?

I am talking about my own industry - but this is often true of many other industries.

Anyway, as I said as I started this blog - what do you think?

Thanks

Neil