Buying groups

Aug 11, 2006 3 Replies

What is the advantage of being part of a buyer's group like "Do it best" for a dealer versus buying from a regular distributor like Bluelinx?



Advantages are national name recognition and advertising plus some increased "buying power" of pooled buying of common stock across multiple stores is _supposed_ to be passed on to dealers. Some of them (and I'm not sure of "Do It Best" itself) are either company-owned stores or franchises rather than independent affiliations so there may be tighter/looser associations as well up to automated stocking/restocking, auto- or sem-auto product volume analysis and selection, etc.

For individual stores of the "Mom and Pop" variety and size, there is often essentially no advantage in purchasing volume discounts from distributors as from those same distributors who also sell OTC because they simply don't have the volume as individual stores to meet the volume discount targets. Similar to the olden days when there were the IGA groceries--that was a group of independent smaller store owners who saw the problem of competing w/ the new chains and formed an alliance amongst themselves to buy common product in bulk.

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