In Todays Auctionbytes newsflash I read a story by Ina Steiner (see below) about a new concept in eBay Franchise Drop Store history. Actually this new concept is the antithesis of an eBay drop store.
Vuurve is the name of this new concept and they claim to have a solution for people who really want the items they buy on eBay - FAST.
This concept involves sending unsold inventory to UPS stores in major metropolitan markets throughout the USA. This unsold merchandise is then stored at the UPS store until someone in the local market decides to buy the product from your eBay store. When the purchase is made, the customer or buyer is then directed to pick up the item at the local UPS store. Sounds simple, right?
Vuurve claims this system (shared distribution model) will promote more sales and increase revenue for eBay merchants.
The cost for the merchant? A mere 24.99 per item!
Oh, and Vuurve at this time is only accepting certain merchandise like Playstation, XBOX & Wii high end game consoles.
Ok, as a "Proof of concept" Vuurve has established a beautiful website which really says very little about how this is supposed to work. It is presented as a very snazzy concept, but it really tells the merchant nothing when you actually try to read the content.
Lets just take a moment and think about this "concept" from the merchants perspective.
As a Merchant in the Vuurve system I will sign up to:
- Ship my merchandise to a UPS Store in LA or New York and hope my buyer actually lives there when they buy it?
- Trust the UPS store to store my high end Wii or Playstation game consoles in a safe manner
- Trust the UPS store employees to deliver my merchandise to the right customers
- Know that UPS stores have loads of room to dedicate to my merchandise
- Expect my customers to prefer to pick up merchandise locally from a UPS Store that they buy online, rather than buy the same merchandise from a local retailer.
- Hope, if a sale is made locally, the buyer will not want to make a return locally like at a retail store
- Plan to send my products to different areas of the country, prior to sale, and hope I am right when I send more to LA than New York.
- Pay $24.99 up front - then pay to ship my merchandise to the UPS store of my choice, significantly adding to my costs on electronics where margins are very slim.
- Do this instead of offering free overnight shipping to my customers (which would cost less and be more convenient for the customer).
I may have missed a few points here but it seems to me this "concept" has some flaws. I know that UPS stores are hurting, and I feel for the franchise owners, but one more attempt to add an eBay component to the mix seems unwarranted. Centralized eBay drop off via the UPS stores network did not pan out, sending the merchandise in the opposite direction is sure to cause even more pain.
The UPS stores do not have the room, the manpower, the expertise or the patience to deal with this Vuurve concept. As a merchant I would no more send a pallet of Wii or Xbox or Playstation gaming consoles to a UPS store in East LA without a deposit, than I would send the same pallett of merchandise to a downtown Detroit YMCA.
(Read more details in the AuctionBytes Story below)
After the rise, peak and decline of the eBay drop-off store comes the introduction of eBay "pick-up" stores. R. David Johnson is founder of Vuurve, a service that lets eBay sellers offer same-day availability of certain items in major metropolitan areas in the US. Johnson said Vuurve gives online retailers the ability to effectively compete against traditional retailer beyond discount pricing, and he said the service would drive more consumers towards online shopping.
eBay sellers select a metropolitan area in which they choose to offer same-day availability. They pay Vuurve $24.99 and send at least one item to one of the participating UPS Stores in the metro area. The seller can now offer one item on eBay with same-day availability in that one metro area. Buyers choose which store in the area they want to go to, show the UPS Store their license and the credit card they used to pay for the item, and go home with the item.
Vuurve is currently limiting acceptable items to hard-to-find gaming systems (the consoles, not the games) and iPods that are new in box. That allows the shopper to go to any of the stores in her metro area, not necessarily the one with the seller's item - she may actually pick an item up that was sent there by a different seller.
Vuurve has forged a relationship with UPS & The UPS Store to build a national network of Pick-Up Stores, and calls the model a shared distribution system. Johnson said the UPS Stores charge Vuurve storage fees and a fee per transaction, and said he believes the service is scalable.
Johnson said he has not yet approached eBay because he wants a proof-of-concept first. There are no listings offering the service on eBay yet, he said that will happen when the service officially launches on July 1.
Vuurve has launched in major Metropolitan areas including Massachusetts, New York, the Washington DC Metro Area and Greater Atlanta. During the next several months Vuurve said it would continue to expand its network of Pick Up Stores farther west to Illinois, Texas and California markets.