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Fate of Mediators
By :   Sarv Daman Vij 
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World is expanding like the theory of big bang. Every next existing or new organization is trying hard to be a part of world expanding business. Organizations are promoting their products by their cranky ideas of advertisement, to attract the customers. Spending heavily on promotion, advertisement, new schemes, and sales technique to sell their product.


Eventually they are spending very high budget on promotion techniques, they always look for other resorts to offset or subdued the prices. Few of resorts are:


  • Increase in prices
  • Elimination of mediators like wholesalers, distributors, agents etc.
  • Staff cuts and layoffs
  • Bonus and incentive cuts


If we go in details of understanding the psychology of human being, high prices, staff cuts, and bonus and incentive cuts will adversely affect the brand image and sales of the products, due to involvement of psychological and esteem factors of society.


High prices eventually shift the consumers to adopt other brands, due to presence of cutthroat competition. Henceforth, ultimate goal of an organization does not solve by increasing prices, which ultimately whop off the growth of organization. In same way layoffs, job cuts, bonus and incentive cuts are striking idea to hit self-motivation of their employees. It will shatter the image of organization due to frequent layoffs and employee's turnover.


Hence, not all these resorts are a clever idea to seek for offsetting the prices.


Last and ultimate resorts left with organization are elimination of mediators. Wherever possible put skills, knowledge, efforts, foresightedness, trends study, research and development dept, and traveling is the solution of elimination. Reason is to grab the suppliers, buyers, to reach the ultimate consumers are some of the major reasons to rely on mediators.


Let us take an example of buying agents, buying agents coordinate and liaison between buyer and supplier and eventually receive the proceeds of their liaisonning. Many times there interest rate goes high from 7 to 10%. Not only have they charged from suppliers for their services. They also charge from Buyers for their liaisonning a times. Buyers generally face below problems:


  • Language barriers
  • Lack of awareness of suppliers and their credibility
  • Types of products are offered in the target market fabrics, accessories, stitching, designs etc.
  • Proximity of suppliers
  • Easy going system with the support of agents.


Henceforth suppliers end up paying high rates for services. Same problems which supplier face are Awareness of buyers, their requirements, quality standards, finally their credibility.


Suppliers and buyers are required to put little extra efforts to eliminate them. Nevertheless complete elimination of mediators is not possible, always depends on he geographical, political, economical condition of country. Countries like, Bangladesh, Pakistan, Vietnam, Mongolia, Nepal, Sri Lanka, some African and South American countries, they really need mediators, their economy still under developing stage, and political and economical upheavals are still concerning areas. Their language and technological advancements barriers are slowing the stage of their growth.


However, Countries like China, Hong Kong, India, Thailand, Egypt, Dubai, Indonesia, Taiwan etc, where barriers have almost eliminated. Political and economical stabilities, high literacy rates, updated education system have made these places highly competitive and more attractive for investment. Nevertheless, it all depends on the internal conditions and level of organization to deal directly with buyers. Let us take an example, if an export house operating from China/India is looking forward for dealing with international buyers directly.


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Published On Friday, June 05, 2009
 
 
 

 
 
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