During these slower ecomonic times every retailer and wholesaler I know are struggling to be profitable. Everyone is doing whatever it takes to stay above water. We all must make certain decisions and I have chosen to not support wholesalers that sell direct to my retail customers, at least the ones I know are doing it. While some are more creative in hiding this activity, others are quite blatant and seem to be saying to bad we are doing whatever we want and if you don't like it tough. One such wholsaler is PAF, Blue Zoo Aquatics is now run out of this wholesale facility 100%, orders are pulled from the same tanks that your wholesale order is and the orders are packed and shipped directly from PAF. Blue Zoo emplyees freely roam and work at this wholesaler. I still supported them some during the years that Reefer Madness was set up and run by PAF but I will no longer support this activity. Blue Zoo sells a lot of fish and bread and butter corals so they are very actively competing with all retailers. I know there has been a business connection for a while, but now the entire operation is run out of PAF with no concern for wholesale customers. So, anyone know for sure what other wholesalers are doing this on the side? I am not badmouthing PAF--Dave is a nice guy and they have good stock, I understand the need to get as much business as you can during this time, but I personally will not support them or other wholesalers I know for sure are selling directly to my retail customers. Rumors abound about other wholesalers doing this, so anyone know any others that have zero degrees of separation from importer to retail?
Zero Degrees of Separation
- Thread starter wonderreef1
- Start date
seamaiden":3nig9jxy said:Wonder, to answer your last question very indirectly, I doubt anyone who knows something like this factually is going to post publicly about it unless they have nothing to lose, if you get my drift.
I thought this horse was already beaten to death by someone else on this forum.
I understand it was discussed before, but at the time I don't think the entire operation was run out of PAF, this is a new development as of the last couple of weeks. There was a talk of a financial interest, but not the full operation being run from the wholesale operation--I felt that move was a real in your face statement by this wholesaler and help me make up my mind that I will not support the activity. I hear rumors about other wholesalers selling direct, but never seen it first hand as I did with PAF. I also do not do business with QM for the same reason. There are only a few others of the traditional wholesalers such as SDC, ERI, UWW, FH, and maybe a small handful of others, just curious as to any of these selling direct too. I know of a couple of the other pseudo transshippers that do have retail websites.
I fully understand the reason for them doing it and I will not call them greedy or badmouth them for this, but I also will not help to support them either, I feel that my dollars do more than my words. I wanted to know if anyone else here knows for a fact that this is being done by specific wholesalers and that way we can all know the facts and do our shopping accordingly. When WS was doing Reefer Madness they were selling at a higher price, but Blue Zoo is selling at prices lower than I can land the same item from PAF, plus they offer free shipping at a very low threshold and I can not compete with that pricing structure and thus will not support the operation even if it means I go without the nice stock that PAF usually has available.
I fully understand the reason for them doing it and I will not call them greedy or badmouth them for this, but I also will not help to support them either, I feel that my dollars do more than my words. I wanted to know if anyone else here knows for a fact that this is being done by specific wholesalers and that way we can all know the facts and do our shopping accordingly. When WS was doing Reefer Madness they were selling at a higher price, but Blue Zoo is selling at prices lower than I can land the same item from PAF, plus they offer free shipping at a very low threshold and I can not compete with that pricing structure and thus will not support the operation even if it means I go without the nice stock that PAF usually has available.
Most of the other wholesalers mentioned have been either directly or indirectly affiliated with Etailing. This is in an effort to compliment their traditional retail sales and take advantage of the changing markets. They treat all their accounts the same. Nothing wrong with that.
I think Dave and PAF stand alone in their model with BlueZoo. Cutting the middleman out, in this case their once loyal retailers is a common business strategy...nothing wrong with that either.
I think Dave and PAF stand alone in their model with BlueZoo. Cutting the middleman out, in this case their once loyal retailers is a common business strategy...nothing wrong with that either.
OK, as long as it is felt "nothing wrong with that" when a wholesaler sells direct to the end consumer and sells at lower than the retailer can land the product then I guess my concern is unfounded. Sorry, not the case for me. The wholesalers grumble that business is slow and can't understand when retailers are buying via tranship or in some instances direct, the more they sell direct to the end consumer the more they will eventually be cut out by retailers and when they realize they make little off their retail direct sales due to "free" shipping offers and extreme guarantees they will wake up some day with red ink on their retail direct venture and few if any wholesler customers. Ok, my rant on the subject is over, it seems no one here feels the practice is wrong and/or no one else wants to name specifics.
In my opinion, they (PAF and Dave) have decided their retail accounts are no longer as important to them. They obviously do not care if their traditional accounts leave them for other wholesalers. They have made a business decision to sell directly to the end user via BlueZoo and formerly ReeferMadness. To accelerate the transition to direct selling, it appears they sell at lower prices and offer shipping incentives through BlueZoo which are not offered to their remaining LFS accounts. I think they have made a business decision to sell direct and say good bye to their old retail accounts. As a retailer you have many other wholesale choices, some of which you mentioned. And yes, as a retailer(LFS) in my opinion you would be a fool to support PAF and BlueZoo, they are competing with you for the exact same customer and offering price incentives to take business away from you.
I support Dave in his decision, business is business. PAF's connection to BlueZoo may provide a market advantage over selling to you wonderreef as a retail account. Dave has a right to make that choice and retailers like you have a right to take your business elsewhere......I guess that was my point.
I support Dave in his decision, business is business. PAF's connection to BlueZoo may provide a market advantage over selling to you wonderreef as a retail account. Dave has a right to make that choice and retailers like you have a right to take your business elsewhere......I guess that was my point.
Yes, my point as well. I geuss I posted and have asked a couple of times if anyone here knows specific other wholesalers that are doing the same thing so I can make an informed decision on them as well. I know QM drop ships for you and I feel this is the same thing so I choose not to support them, I hear rumors about SDC, FH, and ERI, but don't know for sure. Maybe it gets to a more basic question, do the retailers that frequent this forum feel like this is OK and if not what do you do about it other than not buy from that wholesaler, if you do not buy are you just hurting yourself by limiting your buying selection. I suppose as PAF loses its wholesale accounts it will decide to turn the place into an international wholesaler and all domestic will be direct to end consumer. So, as that trend goes along 104th where does that leave the retailers? If I think about it, it reminds me of something like when video rental places were all mom and pop places until Blockbuster came in and then all the mom and pop shops died, now with netflix, etc. places like Blockbuster are hurting. So, is this the beginning of the new trend in our industry, is PAF the explorer for all the rest of the wholesalers to go direct--or will they lose their shirts with "free" shipping and doa replacements and not be able to keep up with the demands of customer service over the long haul. Oh well, interesting to see it all unfold.
SDC dropshipped for an etailer, ERI owned Flying Fish, PAF and Reefermadness and now Bluezoo and the list goes on.
I hope Dave, I and others can grow the etail market to make it a sustainable business venture for all of us. Dave and PAF are one of the first with enough guts to sell online at the expense of their retail accounts, no other wholesaler has done that successfully. I have few retail accounts to worry about so competing with the LFS is nothing new for me, plus I do it as a hobby.
I hope Dave, I and others can grow the etail market to make it a sustainable business venture for all of us. Dave and PAF are one of the first with enough guts to sell online at the expense of their retail accounts, no other wholesaler has done that successfully. I have few retail accounts to worry about so competing with the LFS is nothing new for me, plus I do it as a hobby.
Here is the scoop on what is happening at PAF with Blue Zoo. It is quite common knowledge that I own a substantial piece of Blue Zoo, that has been disscussed here plenty. Blue Zoo was located in Carson, California and was quite a drive to come up to 104th street every day to shop for animals and to deliver their boxes to the airport Fed Ex office. It was not efficient. I have been pushing for them to move closer to the airport for many months. Their lease had expired and they were in a position to move so they leased a location much closer to the airport. Their new address is on 106th street in Inglewood, just 5 minutes away from 104th street which is much more efficient for their daily activities.
They did not have the resources to build out the new place from scratch, they had to move their existing equipment which they did during November and the first part of December. This week the water went into their tanks and their new place is ready. For the past 3 weeks when they had to be out of their old place but the new location was not finished I have let them work out of PAF. They have been here for about 2 weeks in force, shipping out of PAF. That will end next week as Monday they are moving into their new place. They will now be shipping from their own facility in Inglewood. I liked having their sales guys here in the front offices that were previously used by Natures Image (it gave me a better idea of what they are doing all day and is better for their sales team to be on 104th street where they can visit 4 major wholesalers every day) so I am going to let them rent the old Natures Image office for their sales guys. They won't be packing or shipping out of PAF but they will have a sales office here.
Even for the past 2 weeks when they were shipping out of PAF they still shopped at all the wholesalers on 104th street. They buy a lot from PAF but certainly not everything. They have been shipping out of PAF for 2 weeks but it was their employees that did the packing and shipping, it was not PAF doing it for them.
I am not trying to justify my involvement with Blue Zoo, I am comfortable with it. I will not drop ship for another company, I personally don't think that is correct. I do think that it is fine for me to invest in other companies even those that may compete with other companies I may own or those other companies customers. That is my opinion. I sell product from the Solomons to my direct competitors, they often get items that I don't get enough of myself. I am alright with that. Walt is a stock holder in PAF yet he sells product to PAF's direct competition. I am alright with that also, I don't know why people get so uptight about it. I am not looking for world fish and coral domination, I just want to sell some fish and have fun doing it. Having fun at it has been a little tough this past year, it is not so much fun right now. Hopefully this coming year will get better and put a little fun back in the fish business.
Dave
They did not have the resources to build out the new place from scratch, they had to move their existing equipment which they did during November and the first part of December. This week the water went into their tanks and their new place is ready. For the past 3 weeks when they had to be out of their old place but the new location was not finished I have let them work out of PAF. They have been here for about 2 weeks in force, shipping out of PAF. That will end next week as Monday they are moving into their new place. They will now be shipping from their own facility in Inglewood. I liked having their sales guys here in the front offices that were previously used by Natures Image (it gave me a better idea of what they are doing all day and is better for their sales team to be on 104th street where they can visit 4 major wholesalers every day) so I am going to let them rent the old Natures Image office for their sales guys. They won't be packing or shipping out of PAF but they will have a sales office here.
Even for the past 2 weeks when they were shipping out of PAF they still shopped at all the wholesalers on 104th street. They buy a lot from PAF but certainly not everything. They have been shipping out of PAF for 2 weeks but it was their employees that did the packing and shipping, it was not PAF doing it for them.
I am not trying to justify my involvement with Blue Zoo, I am comfortable with it. I will not drop ship for another company, I personally don't think that is correct. I do think that it is fine for me to invest in other companies even those that may compete with other companies I may own or those other companies customers. That is my opinion. I sell product from the Solomons to my direct competitors, they often get items that I don't get enough of myself. I am alright with that. Walt is a stock holder in PAF yet he sells product to PAF's direct competition. I am alright with that also, I don't know why people get so uptight about it. I am not looking for world fish and coral domination, I just want to sell some fish and have fun doing it. Having fun at it has been a little tough this past year, it is not so much fun right now. Hopefully this coming year will get better and put a little fun back in the fish business.
Dave
Well Dave, you have stated your side and I mine. As a now former good customer of yours it speaks volumes to me when you say you can't understand why folks get uptight when you are the collector, importer, wholesaler, and retailer and now seem to casually brush off at least this former loyal customer. I have tried to keep my rant about this civil and hope my words have not been taken any other way. I disagree with your position and will not support you any longer. When you get bored with your retail direct venture or find you lose money in it as Walt did doing "free" shipping and replacements via extended guarantees and supporting a larger staff to provide retail CS, then I'll be back. And yes, let's all hope for better business for all of us in 2010. Best wishes for the holiday season!
Hello Wonderreef, I think that you misunderstood what I meant to say when I said "I don't know why people get so uptight about it". My intent was that I don't know why some folks get so uptight about the fact that Walt sells to my direct competition and that I myself sell Solomon Product to every other wholesaler on 104th street as well as many others who directly compete with me. Much of what my competition gets in these shipments are cherry items that PAF could use for itself. I get a lot of flak from retailers, customers, sales people to name a few about why these cherries go to my competition and we don't keep them exclusive for PAF. I don't get it, share the love, I could keep these items exclusive to PAF but choose not to. If it was just business I would keep exclusive items from these sources but it is not "just business" it also needs to be fun doing it for me.
I am sorry if I have seemed to casually brushed you off as a former loyal customer. It is certainly not my intent to casually brush any customer off. If you disagree with the way I do business at PAF and don't want to support PAF because of that I respect that but I don't think that it is a Casual brush off.
One thing to keep in mind is that as you put it "I get bored with your retail direct venture" PAF will still be the same. Blue Zoo can live or die without PAF, we are not tied together in any way except that I am a shareholder in Blue Zoo. If Blue Zoo loses money with "free" shipping and replacements then they will go under not PAF. PAF is a supplier to Blue Zoo and we get paid every day for the product that they purchase that day. PAF needs zero staff to provide retail customer service for Blue Zoo. Blue Zoo is a stand alone company that I own shares of. They just happen to be shipping out of PAF for the past two weeks while their new space was built out. For PAF it will be just the same as when Walt moved Reefer Maddness out of our location, business as usual with no change in employees. PAF is the same now as it was last month before Blue Zoo was in transition and it will be the same next week when they leave.
Dave
I am sorry if I have seemed to casually brushed you off as a former loyal customer. It is certainly not my intent to casually brush any customer off. If you disagree with the way I do business at PAF and don't want to support PAF because of that I respect that but I don't think that it is a Casual brush off.
One thing to keep in mind is that as you put it "I get bored with your retail direct venture" PAF will still be the same. Blue Zoo can live or die without PAF, we are not tied together in any way except that I am a shareholder in Blue Zoo. If Blue Zoo loses money with "free" shipping and replacements then they will go under not PAF. PAF is a supplier to Blue Zoo and we get paid every day for the product that they purchase that day. PAF needs zero staff to provide retail customer service for Blue Zoo. Blue Zoo is a stand alone company that I own shares of. They just happen to be shipping out of PAF for the past two weeks while their new space was built out. For PAF it will be just the same as when Walt moved Reefer Maddness out of our location, business as usual with no change in employees. PAF is the same now as it was last month before Blue Zoo was in transition and it will be the same next week when they leave.
Dave
I find it interesting that no one seems to get offended if the same company is involved with collection, exporting, importing, and wholesale of aquarium animals but when it extends past wholesale to sell direct to the end user there needs to be total separation according to most. Why is that? What is the difference in the first 4 steps that makes that last step off limits? Many retailers if not all have at one time or another bypassed the wholesalers to purchase an animal from a collector, exporter (direct importing), or importer (some tranship companies) yet the wholesalers do not get too upset about the practice. Yet when it goes the other way it is seen as breaking some accepted rule. The market place generally looks for efficiancies and would it not be more efficient to bypass wholesalers and retailers all together? Customer service could be run like Best Buy does with Fish Geek Squads (or Geek Squids maybe) to take care of customer problems.
I am being sarcastic of course but I do find it interesting that the market finds it fine for one person or company to be the collector, exporter, importer, and wholesaler but that it stops there. Why do you folks think that is?
Dave
I am being sarcastic of course but I do find it interesting that the market finds it fine for one person or company to be the collector, exporter, importer, and wholesaler but that it stops there. Why do you folks think that is?
Dave
Well Dave, I wanted to avoid a heated debate. Here is why I personally think it is wrong to go to the last step as you put it. If I support you in business, as in, I buy wholesale from you, I assume you will not sell direct to my customer. As the collector, Importer, wholesaler, and now retailer, you have the ability to be profitable and undercut my prices, thus putting me out of business---I have to take what you ship me good and bad I have to ship it and pay for freight boxes travel to airport etc. and I have to deal with more mortality due to that added stress to the animals than you do and you so you can sell at a price I can not. I guess it is being a gentleman (OK I am naive), that you do not sell to my customer when you sell your product to me at wholesale, you certainly can sell retail just don't do both (Of course you can and do do what ever the L you want). Also, and this is a big one for me, you have the ability to stock far more product than I can--I can't stock all the fish you have access to daily or list on your site every imaginable coral that you know you can get in at some point each week. And, there will in fact at some point be the natural progression that you will funnel the better product to your own retail business despite what you say here about PAF being totally the same now as it was before and will be in the future. If you can sell retail that amazing Fiji Acro or Solomon zoo at lets say $75-$150 or sell it to me at wholesale for lets say $15-$35, I'll leave it at that as to what the natural progression will be in that scenario. Anyway, it is pointless for me to continue, you see nothing wrong with you selling direct to the my customers and I object to that and have chosen to not support your wholoesaler venture and you somehow do not understand my reasoning for that decision.
I think the difference in the last step, compared to the first four, is that most retailers only compete in the last step. The first four are mostly not relevent.
Dave, although I respect your decision to dump on retailers, I think you need to be honest with yourself. Do you really expect a retailer to buy from LiveAquaria.com??? I do not and PAF and BlueZoo are no different. You and I are both Etailers attempting to sell to a would be LFS customer. We are fighting them for the same customer, the same transaction. I have no problem admitting that and would never attempt to develop a business plan to sell to retailers while at the same time,----- selling to their customers. That is why I do not own a Wholesale entity. Who would buy from me,--- except me???? Me buying from me is not a retirement plan.
Dave, although I respect your decision to dump on retailers, I think you need to be honest with yourself. Do you really expect a retailer to buy from LiveAquaria.com??? I do not and PAF and BlueZoo are no different. You and I are both Etailers attempting to sell to a would be LFS customer. We are fighting them for the same customer, the same transaction. I have no problem admitting that and would never attempt to develop a business plan to sell to retailers while at the same time,----- selling to their customers. That is why I do not own a Wholesale entity. Who would buy from me,--- except me???? Me buying from me is not a retirement plan.
Race, The first 4 are not relevant only to retailers, they are certainly relevant to the folks in the chain of the first 4.
Years ago much of the product for the trade was brought in by importers who then sold the product to wholesalers. Most of those importers now have gone heavily into transhipping thus bypassing their original customers the wholesalers. This did not make the wholesalers very happy and many will rant about the evils of transhipping. I still buy a fair amount of product from these importers because they take care of me, they know that I am a good large customer so they take extra effort to get me good product. Many former importers are now out of business because some exporters opened offices in the states and started importing their own products thus bypassing the importers. The importers were not very happy about this yet the trade seems to see it as just a natural progression of business that gets product to market cheaper, with better quality, and faster feedback along the chain. I agree with this, it does but there was not much crying about the folks bypassed.
As a wholesaler a lot of our former business is being bypassed by importers transhipping product. I don't cry about it and call it unfair, I just try to do a better job so that I stay relevant to the retailers that I serve. I don't bypass the importers who are feeding the tranship market, I still buy from the ones that give me good product at a good value. If they can earn my business I give it to them.
Race you should by a wholesale operation. With the amount of business that you do with Quality Marine you should buy the place. I bet that you could get a good price with the economy the way it is. You might lose 10% of their customer base but Kevin could bring in an extra 20% if you would let him run it. You could take over the 104th street market if you let Kevin have a go with Quality Marine.
Dave
Years ago much of the product for the trade was brought in by importers who then sold the product to wholesalers. Most of those importers now have gone heavily into transhipping thus bypassing their original customers the wholesalers. This did not make the wholesalers very happy and many will rant about the evils of transhipping. I still buy a fair amount of product from these importers because they take care of me, they know that I am a good large customer so they take extra effort to get me good product. Many former importers are now out of business because some exporters opened offices in the states and started importing their own products thus bypassing the importers. The importers were not very happy about this yet the trade seems to see it as just a natural progression of business that gets product to market cheaper, with better quality, and faster feedback along the chain. I agree with this, it does but there was not much crying about the folks bypassed.
As a wholesaler a lot of our former business is being bypassed by importers transhipping product. I don't cry about it and call it unfair, I just try to do a better job so that I stay relevant to the retailers that I serve. I don't bypass the importers who are feeding the tranship market, I still buy from the ones that give me good product at a good value. If they can earn my business I give it to them.
Race you should by a wholesale operation. With the amount of business that you do with Quality Marine you should buy the place. I bet that you could get a good price with the economy the way it is. You might lose 10% of their customer base but Kevin could bring in an extra 20% if you would let him run it. You could take over the 104th street market if you let Kevin have a go with Quality Marine.
Dave
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