Church Purchasing 101: How Vendors Distribute Products Usually Determines How Much You Pay
Church Purchasing 101: There are two primary ways that manufacturers sell their products to end users such as our churches. One of those is summed up in the familiar phrase “buy direct from the manufacturer.” The other involves a manufacturer utilizing a network of approved distributors and dealers. There are pros and cons with each, and there are some variations to each of these scenarios, but here is a basic overview of how each function.
In the “direct from the manufacturer” scenario there are only two parties involved, the church and the manufacturer. The manufacturer, in utilizing the “direct” phrase, desires to convince you that you can buy for less through buying “direct.” Does that happen? Our experience has been that rarely is the case. By choosing to deal directly with the church, the manufacturer in turn has to employ extensive marketing, sales and support forces that are costly. That marketing, sales and support force becomes, for all practical purposes for the manufacturer who sells “direct,” their own dealer and distribution network. The costs for providing all this are then absorbed by the manufacturer and passed on to the church in the price of their products. There are a myriad of other costs that also come into play as a part of this scenario. Again, our experience has been the promised savings through buying in this manner do not materialize.
In the “approved distributors and dealers” scenario, an independent company contracts with manufacturers who do not sell to churches direct, to be able to sell their products to churches for them. They become a dealer for the manufacturer. That dealer then assumes the costs of marketing and sales for those products. Some such dealers are quite large, and as a result often have high overhead costs of doing business. The production and mailing of catalogs, the maintaining of extensive web sites, paying fees for other groups or organizations to affiliate and endorse them, conference booths and trade shows, not to mention buildings, personnel and other substantive costs that are a part of doing business are passed on to the church within the pricing schedule each dealer sells the manufacturer’s products for. As a result, there can be a substantial difference in the prices of various dealers on the same manufacturer’s products because those prices are dependent on the operational efficiency and business philosophy of each dealer.
Why Buying from Church Furniture Partner Actually Saves Your Church Money
We are a dealer for 200 plus manufacturers who do not sell to churches direct. A governing strategy for Church Furniture Partner is “Let’s operate with the goal of having as close to a 0% overhead cost as possible.” Many dealers have to mark up their actual product costs 20 to 25% in order to pay their own overhead costs. We have decided that we will NOT incur expenses on such costly items as catalogs, advertising, trade shows, affiliations, conference booths, buildings, warehousing, credit card fees, website shopping cart systems, etc. Many companies invest in these because they increase their sales by getting their name into the hands of potential customers. But this practice inevitably leads to higher prices for their customers.
The “We Buy in Quantity to Save You Money” Myth
You will sometimes hear a large dealer say, “We buy in such quantities that we can sell to you for less!” While it’s true at times that a dealer who buys a very high quantity of a particular product can get a better price on that product, we have not experienced that resulting in lower prices. Time and time again, we are able to sell for less. If we can’t, we’ll be upfront and let you know.
Won’t I Get Faster Service When I Order Through a Major Dealer?
When you order a product through a dealer, the dealer then places an order with the manufacturer. In most cases, the manufacturer then fills the order and ships the product to your church. The dealer rarely sees the actual product themselves. This means that you could choose to order that product through a choice of hundreds of different dealers, and yet it would be the same product from the same manufacturer shipped on the same truck arriving at your church on the same day. Our goal is to be the dealer than sells that product to you for the fewest dollars.
Buyer Beware: Some Dealers Make Money By Inflating Freight Charges.
Most companies give freight estimates to customers when orders are being considered. Our experience has been that actual freight costs are often less than these estimates, thus freight overcharges become a way that some dealers utilize to increase profit. Our belief is that when we give our customers a freight charge, it should be exactly what we were charged, with no mark-ups.
Are There Other Reasons I Should Consider Purchasing from Church Furniture Partner?
We want you to know that we will do our best to assist you in any way we can. If we believe we are not your best option, we will tell you so. We also want to let you know that Church Furniture Partner is committed to tithing on any and all profits. Beyond that, if you have any questions for us or if we can help you in any way, please contact us. We’d love to hear from you!