Introduce More Products Without Raising Risk

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Re: NPI and risk
rederringer   12/20/2012 7:22:24 PM

@Barbara - having worked as a channel manager on the supplier side, I can tell you that the "thrill" of booking NPI orders is far outweighed by the "agony" of authorizing an NPI return. One final point - from my experience, manufacturers often mitigate risk by promoting NPI at less than MOQ - but at an inherently higher cost to produce - and ship - less than MOQ. A master distribution strategy allows the manufacturer to produce and ship one NPI lot in economic manufacturing quantity. Hey - there's a new acronym for us - EMQ! Not that we need any more acronyms in our business :-)

Barbara Jorgensen
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NPI and risk
Barbara Jorgensen   12/20/2012 9:05:18 AM

I think the risks associated with NPI isn't well understood throughout the industry. It surprised me when I heard suppliers may develop a family of products with minor tweaks to see which one will stick. If you can afford that, I guess it makes sense, but for distrbutros that have to have the inventory on hand, it does increase risk. I can see the advantage of a master distributor, especially to the catalog/ecatalog folks.

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